DSM positive about business momentum, increases full-year outlook

By Jane Byrne

- Last updated on GMT

© GettyImages/takasuu
© GettyImages/takasuu

Related tags Vitamin ASF China Poultry

Vitamin producer, DSM, has reported a good start to the year. It has just released its first quarter 2019 results.

The company announced a total net profit of €196m in Q1, up versus the quarter in the year prior - after correcting for the temporary vitamin effect of €165m earnings before interest, taxes, depreciation, and amortization (EBITDA) following the major supply disruption in the sector last year.

Feike Sijbesma, CEO of DSM, said the company saw continued positive momentum in the first quarter, led by its nutrition business, while its materials division shows resilience: “Last year we benefitted from an exceptional growth and profit contribution in nutrition following a supply disruption in the vitamin industry. When comparing our results excluding this special event, we realized strong, double digit adjusted EBITDA growth in the first quarter against a very strong comparable period in the underlying business.”

Due to heightened visibility, and the fact the group is seeing good impetus in nutrition in particular, both on the human and animal side, DSM has increased its full year outlook for 2019, said Geraldine Matchett, DSM‘s chief financial officer, on a conference call this morning.

Animal nutrition

Overall, nutrition showed 3% organic growth in Q1 2019, against a tough comparison of 12% organic growth in Q1 2018, excluding the one-time vitamin effect, said DSM.

The company said Q1 saw continued good business conditions for its animal nutrition division across all regions barring China where the African Swine Fever (ASF) outbreak intensified.

The impact of that deadly pig virus on its business in China was partly compensated by higher poultry production in that country and increased pork production in other regions, where DSM is also strong, underlining its integrated and diversified animal nutrition business model, said the Netherlands headquartered group.

It reported that the animal nutrition business registered -2% organic sales with stable volumes and the price/mix slightly decreased.

“This is a solid performance when compared with the 18% organic growth in Q1 2018. Overall, sales were 1% lower as currencies had a 1% positive impact resulting from a stronger US-dollar, partly offset by a weaker Brazilian real.”

Sustainability targets

The company also reported on a number of sustainability initiatives in which it is involved.

In March this year, it said it set new science-based reduction targets for greenhouse gas emissions aligned with the Paris climate agreement.  

It reported that it is progressing well in terms of its target of reducing 30% of its greenhouse gas emissions from direct production.

Together with energy company, ENGIE, and Swiss energy provider, ewz, DSM opened a new green energy plant at its vitamin facility in Sisseln in Switzerland, reducing CO2 emissions by 50,000 tons a year.

It has also opened a newly expanded 66-acre solar field in New Jersey, in the US, estimated to produce 25,000,000 kWh of renewable electricity annually, and introduced a system that will reportedly allow a 30 to 40% reduction of waste to landfill at its Zhangbin site in Taiwan, supporting its ambition to have 80-90% of waste recycled in 2020. 

Related news

Show more

Related products

A pioneer and leader in microbial fermentation

A pioneer and leader in microbial fermentation

Content provided by Lallemand Animal Nutrition | 05-Dec-2023 | Business Advice

For over 100 years we've been producing yeast and bacteria for a variety of markets, Lallemand has perfected the art of fermentation. As primary microorganism...

Follow us


View more