Slide 1: 2018 Full Year Results
2018 Full Year Results Strong business momentum Investing for the future 25 January 2019
Slide 2: Gilles Andrier, Chief Executive Officer
Gilles Andrier Chief Executive Officer 2018 Full Year Results 25 January 2019 2
Slide 3: Performance highlights
2018 Full Year Results Performance highlights • Sales of CHF 5.5 billion, up 5.6% on a like-for-like* basis and 9.4% in Swiss Francs • EBITDA of CHF 1,145 million; EBITDA margin of 21% • Free cash flow of CHF 703 million; 12.7% of sales • Proposed dividend of CHF 60.00 per share, up 3.4% year on yea
Slide 4: Sales performance
Sales performance Strong growth in both divisions in million CHF 5,527 3,002 2,525 Group Fragrances Flavours % 2018 growth on LFL* basis 5.6 % 6.6% 4.6% % 2018 growth in CHF 9.4% 7.8% 10.8% * LFL (like-for-like) excludes the impact of currency, acquisitions and disposals 2018 Full Year Results 25 Ja
Slide 5: Sales evolution by market
Sales evolution by market Strong recovery in high growth markets in million CHF 3,176 2,867 2,351 2,184 FY2017 FY2018 FY2017 FY2018 Mature High growth % of total sales 57% 57% 43% 43% % 2018 growth on LFL* basis 3.6% 8.2% * LFL (like-for-like) excludes the impact of currency, acquisitions and dispos
Slide 6: Sales evolution by region
Sales evolution by region Strong growth led by Asia Pacific & Latin America in million CHF 1,982 1,723 1,475 1,441 1,358 1,352 618 629 FY FY FY FY FY FY FY FY 2017 2018 2017 2018 2017 2018 2017 2018 LATAM APAC NA EAME % 2018 growth on LFL* basis 10.6% 7.8% 2.1% 4.7% * LFL (like-for-like) excludes th
Slide 7: Divisional sales performance: Fragrance Division
Divisional sales performance Fragrance Division Fine Fragrance sales growth of 10.7% LFL* Fragrance Division sales in CHF million • Strong growth achieved across all geographies and customer groups • Sustained growth over the last three years 2,525 leads to No. 1 position in Fine Fragrance 2,343 Con
Slide 8: Divisional sales performance: Flavour Division
Divisional sales performance Flavour Division Asia Pacific growth of 6.2% LFL* Flavour Division sales in CHF million • Double-digit performance in India and Singapore, with strong single-digit growth in China, Indonesia and Thailand 3,002 EAME increased by 3.0% LFL* • Double-digit growth in Sweden,
Slide 9: Acquisition update: 2020 strategy in motion
Acquisition update 2020 strategy in motion 2014 2016 2018 Soliance Spicetec Centroflora Nutra Active Beauty Naturals Naturals Integrated Solutions Expressions Approx. Parfumées L&R Fragrances CHF 1 billion of incremental revenues** Naturex 2015 2017 Naturals Health & well-being CHF 2.5 billion inves
Slide 10: Naturex acquisition in 2018
Naturex acquisition in 2018 Compelling strategic rationale and integration well on track • Fully aligned with 2020 strategy • Expansion into new spaces beyond flavours • Increasing consumer preference for naturals • Complementary customer base • Very good cultural fit Strategic rationale What we hav
Slide 11: Naturex: natural ingredients combined with Givaudan's portfolio
Naturex acquisition in 2018 Combine differentiated natural ingredients with Givaudan’s portfolio to create added value for our customers 01 02 01 Natural preservatives e.g. rosemary 02 Natural taste e.g. acerola cherry 03 04 03 Natural colours e.g. spirulina 04 Phytoactives e.g. cranberries Very pos
Slide 12: Givaudan Business Solutions
Givaudan Business Solutions Implementation on track – First benefits in 2018 • GBS fully on track with plan; delivering tangible benefits in line with defined objectives • EU transitions successfully completed in 2018, with the US planned to complete by end Q1 2019 • GBS centres in Budapest, Buenos
Slide 13: Tom Hallam, Chief Financial Officer
Tom Hallam Chief Financial Officer 2018 Full Year Results 25 January 2019 14
Slide 14: Financial highlights
2018 Full Year Results Financial highlights • Sales of CHF 5,527 million, up 5.6% on a like-for-like* basis and 9.4% in Swiss Francs • EBITDA of CHF 1,145 million compared to CHF 1,089 million in 2017 • Reported EBITDA margin of 20.7% compared to 21.6% in 2017, with the underlying margin at 21.0% ve
Slide 15: Exchange rate development
2018 Full Year Results Exchange rate development Mature markets relatively stable whilst more volatility in EM currencies, mainly in Latin America 4% 2% 1% -5% -13% JPY USD GBP EUR SGD BRL CNY MXN IDR FY 2018 0.88 0.98 1.30 1.15 0.72 0.27 0.15 0.05 0.69 FY 2017 0.88 0.98 1.27 1.11 0.71 0.31 0.15 0.0
Slide 16: Operating performance: Group
Operating performance Group: Sustained good profitability Sales of CHF 5,527 million, an increase of Gross margin 5.6% on a like-for-like basis and 9.4% in EBITDA 42.1% Swiss Francs in CHF million 1,145 Gross margin of 42.1%, compared to 44.5% in 2017, due to the lower gross margin in the Fragrance
Slide 17: Operating performance: Fragrance Division
Operating performance Fragrance Division Sales of CHF 2,525 million, an increase of EBITDA in CHF million 7.8% in Swiss Francs 508 486 +4.6% EBITDA of CHF 508 million versus CHF 486 million in 2017, driven by the reduction of costs of the GBS project, as well as insurance proceeds of CHF 20 million
Slide 18: Operating performance: Flavour Division
Operating performance Flavour Division Sales of CHF 3,002 million, an increase EBITDA in CHF million of 10.8% in Swiss Francs 637 603 +5.7% EBITDA of CHF 637 million, compared to 603 in 2017, driven by continuing productivity gains and cost discipline EBITDA margin of 21.2%, compared to 22.3% in 201
Slide 19: Amortisation of intangible assets
Amortisation of intangible assets Updated to include all recent acquisitions Total annual amortisation charge (in million CHF, estimated) 125 165 161 156 116 101 40 40 40 38 40 87 83 40 78 49 66 21 21 21 21 61 4 17 17 17 17 6 - 2018 2019E 2020E 2021E 2022E 2023E Pre Quest Quest Other acquisitions Ot
Slide 20: Net income
Net income Impacted by higher taxes & foreign exchange losses Income before tax of CHF 772 million, Net income in CHF million decreased from CHF 795 million in 2017, 720 driven by the increase in non-operating expenses, mainly in relation to foreign 663 exchange losses in Argentina Net income of CHF
Slide 21: Free cash flow
Free cash flow Sustained underlying performance Free cash flow of CHF 703 million, Free cash flow in CHF million compared to CHF 594 million in 2017. 703 FCF is 12.7% of sales compared to 11.8% in 2017 Operating cash flow of CHF 916 million, an increase of 6.4% versus 2017 594 Total net investments
Slide 22: Dividend per share
Dividend per share Increasing 3.4% YoY Free cash flow of CHF 7.8 billion generated over the past 19 years CHF 4,218 million of cash flow returned to shareholders as dividends* and CHF 504 million (net) through share buy-backs 54 56 58 60* 47 50 36 20 20.6 21.5 22 18.8 19.5 15.4 16.3 17.6 720 703 662
Slide 23: Long duration debt maturity profile
Long duration debt maturity profile New issuance to support acquisitions • In March 2018 the Group issued two Swiss Franc bonds of CHF 150 million and CHF 200 million, the proceeds of which were used for general corporate purposes. • In September 2018 the Group issued a fixed rate dual tranche EUR b
Slide 24: Leverage ratio
Leverage ratio Increase related to the Naturex acquisition Leverage ratio of 41% as at December 2018 compared to 21 % in 2017. The increase comes as a result of the debt assumed in relation to the acquisitions made during 2018, most notably Naturex. The Group affirms its medium term leverage target
Slide 25: Gilles Andrier, Chief Executive Officer
Gilles Andrier Chief Executive Officer 2018 Full Year Results 25 January 2019 26
Slide 26: 2019 Outlook & 2020 Guidance
2019 Outlook & 2020 Guidance
Slide 27: 2019 Outlook: Key themes
2019 Outlook Key themes Growth Outlook Raw Materials Naturex • Continued confidence in our • Raw materials outlook for • Focus on integration project growth strategies 2019 at 5-6% • Strong attention on sales • Local and regional customers • Continue to implement price growth, service levels and con
Slide 28: Partner of choice
Responsible growth. Shared success. Growing with Delivering Partnering for our customers with excellence shared success 4-5% 12-17% Average organic sales Average free cash Partner growth* flow as % of sales* of choice 4.9% in 2016-18 12.4% in 2016-18 * Over a five-year period by 2020 Creating additi
Slide 29: Q & A
Q&A 2018 Full Year Results 25 January 2019 30
Slide 30: Disclaimer
Disclaimer No warranty and no liability: While Givaudan is making great efforts to include accurate and up-to-date information, we make no representations or warranties, expressed or implied, as to the accuracy or completeness of the information provided on this presentation/handout and disclaim any