09 August 2005 13:07 [Source: ICIS news]
LONDON (CNI)--A marked decline in fragrance margins due partly to rising raw material costs was reflected in a 1.7% fall to SF282m ($223m/Euro181m) in first half operating profits from Givaudan on Tuesday.
Earnings before interest, tax, depreciation and amortisation (EBITDA) from the Swiss flavours and fragrances group were also down slightly, to SF335m compared with a restated SF339m for January to June last year.
Group sales were 2.2% lower at SF1.37bn, although the decline in local currencies was only 0.2%.
Operating profits from the fragrance division were 11% lower at SF83m on sales virtually unchanged at SF555m. Givaudan said the margin decline to 15% from 16.8% in H1 last year was due chiefly to lower fine fragrance sales, higher raw material costs plus increased investments in marketing and sales.
Flavour division operating profits rose 2.6% to SF199m despite a 3.8% (1.6% in local currencies) decline to SF813m in sales. Givaudan said margins rose to 24.5% from 23%, reflecting an improved product mix and production consolidation in Europe. Flavour sales were reduced by SF15m due to lower vanilla and citrus market prices plus the pruning of lower margin products.
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