The Switzerland-headquartered company published strong annual results earlier this week, but noted the ‘sharp increase in some key raw material prices towards the end of 2010’.
Given that it expected these price increases to continue, the company said it would be working with its customers to ‘make the necessary adaptation of its prices’.
Rebound in sales figures
Annual sales for the company increased 7.1 per cent in Swiss francs to reach CHF 4.24bn, (€3.23bn), with particularly strong growth coming from the fragrance division.
For the full year 2010, the fragrance division reported sales of CHF1.99bn up 9 per cent from last year’s CHF1.82bn.
Out of the three business units that make up the division, fine fragrances showed the biggest sales growth (up 18.3 per cent in local currencies on last year), however the growth figures were affected by drastic destocking suffered during 2009.
The consumer products division is less cyclical, according to the company, and reported a sales increase of 8.3 per cent in comparison to last year.
Fragrance ingredients were also up on last year’s performance, reporting sales growth of 10.7 per cent in local currencies.
Net income up on strong sales and cost reductions
Strong sales, which were also recorded in the company’s flavours division, helped drive net income of €340m, compared to €199m in 2009.
In addition to the good sales figures, Givaudan also highlighted ‘tightly controlled expenditure’ during the quarter which helped boost earnings.
In addition, Giavudan noted the completion of the Quest integration. The company, which was acquired in 2007, has now been fully integrated into Givaudan and the combined operations generate CHF 230m in annual savings, it said.
Commenting on the results, Givaudan CEO Gilles Andrier said: “I am proud that we have successfully achieved all our integration targets and delivered excellent 2010 results…we now enter with confidence the next era of profitable growth.”