Ingredients sales rise 5% at Danisco
June 22, 2007
by Jeff Gelski
DENMARK — Ingredients sales at Danisco rose 5% in the year ended April 30 thanks to trends toward healthier food, the trend toward food producers collaborating with ingredients producers on product development and the growing demand for bio-based industrial solutions, the company reported June 20. Ingredients sales were DKK13.64 billion ($2.46 billion), which compared with DKK13.29 billion ($2.40 billion) in the previous year.
Within Ingredients, Bio Ingredients reported revenues of DKK5.21 billion, compared with DKK5.10 billion the previous year. Texturants & Sweeteners revenues were DKK6.89 billion, compared with DKK6.67 billion. Flavours turned in revenues of DKK1.562 billion, compared with DKK1.555 billion, even though Danisco in May reported the divestment of Flavours to Switzerland-based Firmenich.
The increasing production of bioethanol and biodiesel will continue to have a direct and indirect impact on the price of raw materials included in the production of food ingredients and products, according to Danisco. A demand for healthier food also will continue to require a greater content of certain ingredients, such as Danisco’s texturant ingredients, according to Danisco.
"Second-generation products like prebiotic and probiotic cultures as well as xylitol and other specialty carbohydrates are already strong segments for Danisco," the company said. "Therefore, Danisco will increasingly focus on expanding this product range of active ingredients — through own product development and external products."
Companywide, Danisco reported revenues of DKK20.36 billion for 2006-07, down from DK20.91 billion in the previous fiscal year. Profit for the year came to DKK1.08 billion, up from DKK622 million. EBITDA before special items and share-based payments declined 5% to DKK3.29 billion.
The European Union sugar reform provided a challenge that was bigger than expected for the sugar Industry, according to Danisco. For Danisco in 2006-07, Sugar accounted for 34% of revenues and Ingredients accounted for 66%, which compared with Sugar at 37% and Ingredients at 63% in 2005-06.
Danisco’s outlook for 2007-08 includes expected revenues of DKK19 billion. The outlook accounts for the divestment of Flavours to Firmenich, organic growth at the level of 4% in Ingredients, and a revenue decline in Sugar because of the E.U. sugar reform.