Danisco sales grow but profit falls for year

by Jeff Gelski
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COPENHAGEN, DENMARK — Danisco had sales growth of 6%, including 4% organically, in the fiscal year ended April 30, but profit and earnings per share both declined, the company said June 24. Revenue of DKK12,991 million ($2,452 million) compared with DKK12,219 million in the previous fiscal year. Profit for the year fell to DKK72 million ($14 million) from DKK1,299 million. Earnings per share were DKK2.28 in 2008-09, down from DKK26.03 in 2007-08.

For the 2007-08 fiscal year, Danisco restated the income statement and cash flow statement and did not include two discontinued operations: the Flavours division and the Sugar division.

Emulsifiers, Gums & Systems and Cultures all experienced growth in the fiscal year. Genencor and Sweeteners declined.

In Food Ingredients, fiscal-year revenue came in at DKK8,975 million ($1,693 million), which marked 6% growth and 4% organic growth from the previous fiscal year, which had revenue of DKK8,565 million.

A drop in xylitol in both volume and price affected Sweeteners, which saw fiscal-year revenue decrease to DKK1,495 million ($282 million) from DKK1,652 million and fiscal-year EBITDA decrease to DKK175 million ($33 million) from DKK369 million.

Fiscal-year revenue for Enablers was DKK5,544 million ($1,046 million), up from DKK5,134 million, while EBITDA was DKK906 million ($171 million), up from DKK836 million. Cultures posted fiscal-year revenue of DKK1,936 million ($365 million), up from DKK1,779 million, and EBITDA of DKK420 million ($79 million), up from DKK359 million.

Genencor for the fiscal year reported revenue of DKK4,065 million ($767 million), up from DKK3,686 million, and EBITDA of DKK636 million ($120 million), down from DKK731 million.

Companywide in the fourth quarter, Danisco posted revenue of DKK3,310 million ($625 million), up from DKK3,104 million, and profit of DKK160 million ($30 million), which compares with a loss of DKK86 million in the previous year’s fourth quarter.

"This year has been marked by achievements and challenges for Danisco," said Tom Knutzen, chief executive officer. "We executed the Sugar divestment in line with our commitment to shareholders — and for the continuing part of Danisco our strategic priorities remain intact.

"We have the right platform to accommodate the opportunities and challenges of the future through innovation, sustainability and focus. However, we also recognize the necessity to improve our performance through higher earnings, better utilization of our capital employed and reductions in our net working capital."

In March, the company announced a salary freeze for 2009 and hiring restrictions.

For this fiscal year Danisco expects organic revenue of DKK13.5 billion, reflecting a growth of 3% to 4%, EBIT of about DKK1.3 billion and group profit for the year of about DKK650 million.

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