Symrise AG : Symrise Starts Fiscal Year with Robust Sales Growth

Symrise AG has enjoyed a strong start to the 2012 fiscal year. The Group posted robust sales growth and achieved the targeted EBITDA margin of 20% despite higher raw material brightening costs. Over the course of the quarter, Symrise benefited from improving market conditions and as a result saw a stronger demand for its products. Compared to the prior-year quarter sales rose 4% to €432.6 million (Q1 2011: €416.8 million). This development was driven in large part by the disproportionate growth seen in business with global customers. North and Latin America also provided notable growth impetus.

Dr. Heinz-Jürgen Bertram, Chief Executive Officer of Symrise AG, said: "Symrise is off to a solid start for the current fiscal year. After the subdued development at the beginning of this year, the market environment improved faster than originally anticipated. Our business with global customers has grown especially rapid. In addition, we maintained our profitability at our targeted margin level of 20% despite high raw material costs. We also expanded our market presence with targeted acquisitions and strengthened our focus on innovation in fast growing market segments. In view of the positive developments seen in this quarter, we are raising our sales outlook for the current financial year."

Sales up 4%
Symrise generated sales of €432.6 million during the first quarter of 2012 (Q1 2011: €416.8 million). After a reserved start to 2012, economic development brightened over the course of the first quarter, particularly in March, and stimulated a positive boost to demand. With an increase of 4% (2% at local currency), the Group has laid the foundation for further growth over the course of the year.

Latin America continued its positive development, achieving a sales increase of 10% (10% at local currency). Particularly Oral Care, Sweet and Beverage application areas contributed to this growth. Business in North America significantly recovered, posting sales growth of 13% (9% at local currency). This was mainly supported by high demand in Life Essentials and Oral Care. Sales in Asia/Pacific were up 5% (1% at local currency). The individual segments developed very favorably in this region. Sales in the EAME region decreased by 2% against the prior-year quarter (-2% at local currency). A positive development in Fine Fragrances could not fully compensate for the lower demand in the UV Protection and in Aroma Molecules.

EBITDA margin of 20.1% achieved
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose by 2% to €87.0 million (Q1 2011: €85.2 million) in the reporting period. Along with higher energy costs, the ongoing volatility of raw material prices influenced the result. In addition to the steep rise of the oil price, the first quarter also saw selective price increases for other raw materials. Symrise benefited from its backwards integration with important raw materials which will be further expanded with the nearly finished addition of production capacities for Menthol. Despite these impacts on the cost side, the Group was able to keep profitability above its target mark with an EBITDA margin of 20.1% (Q1 2011: 20.5%).

Net income for the period amounted to €43 million corresponding to a 3% increase on the prior-year quarter (Q1 2011: €41 million). Symrise slightly increased its earnings per share to €0.36 (Q1 2011: €0.35).

Balance Sheet and Cash Flow
Symrise ended the first quarter with a stronger balance sheet and enhanced financial strength. The equity ratio increased to 45% against the same period last year (Q1 2011: 43%). Cash flow from operating activities rose to €19.7 million; it was therefore significantly above the previous year's figure (Q1 2011: €6.4 million) which was impacted by greater working capital due to the increase of strategic inventories. At 2.2, the ratio of net debt incl. pension provisions to EBITDA remained nearly even compared to the first quarter and the end of 2011; it remained at the lower end of the target range of 2 to 2.5.

Expanding Market Presence in Emerging Markets
During the first quarter, Symrise strengthened its market presence in the emerging markets through organic growth and acquisitions. With the takeover of Belmay's Brazilian activities, the Group expanded its existing range of offers with products for the Fine Fragrances, Hair Care and Personal Care application areas. Emerging markets accounted for 46% of total sales in the first quarter.

Above Average Growth with Global Customers
Symrise also continued to expand its strategically important business with internationally operating food and consumer goods corporations in the first quarter. Sales with the ten largest customers per division increased 8% at local currency, considerably exceeding the growth rate of overall sales. Business with global customers was especially dynamic in the Scent & Care division with an increase of 10% at local currency. Flavor & Nutrition posted a sales increase of 5% at local currency in line with the top ten customer business. The Group generated almost one third (32%) of its sales with top ten customers in the reporting period.

Scent & Care Division
Scent & Care posted sales of €225 million in the first quarter (Q1 2011: €218 million), corresponding to a growth of 3% (1% at local currency) compared to the prior-year quarter.

The Oral Care business achieved double-digit sales growth due to new business in North and Latin America. In addition, Scent & Care benefited from the expansion of its portfolio, strengthening its position as one of the leading providers of product solutions for cosmetic applications. In Fine Fragrances sales growth was more moderate and reflected slower demand.

With sales up 15% at local currency, Latin America was once again the fastest growing region for Scent & Care. The division boosted sales considerably in the Oral Care business due to newly gained business wins. With the acquisition of Belmay's Brazilian activities, Scent & Care further expanded its existing portfolio. The second strongest region was North America, with sales growth of 7% at local currency. Strong increases in Oral Care and Life Essentials were the main drivers. In February Symrise announced the acquisition of Trilogy Fragrances which strengthens the dynamically growing business with natural perfume oils and contributes to further expand the Group's presence in North America. In Asia/Pacific, the division generated growth of 2% at local currency and benefited from increasing demand in Menthol applications and for household products. Despite the positive development of Fine Fragrances in EAME, sales in the region decreased 6% at local currency and mainly reflect lower demand in UV protection and Aroma Molecules.

In the reporting period, EBITDA for Scent & Care increased 4% to €45 million. The EBITDA margin for the division was slightly above the previous year's mark at 19.9% (2011: 19.7%).

Flavor & Nutrition Division
Flavor & Nutrition increased sales by 5% to €208 million (Q1 2011: €198 million) in the first quarter 2011. At local currency, this corresponds to a sales growth of 3%. The division benefited from its strong position with global customers and the expansion of its activities in North America.

With a sales rising by 11% at local currency, Flavor & Nutrition experienced particularly dynamic growth in North America. The main drivers were strategically important global customers, with whom Symrise generated a wide range of new business in the first quarter. In EAME, sales rose by 3% at local currency. The emerging markets in Eastern Europe, Africa and the Middle East were significant contributors here. In Latin America, sales were also up by 3% at local currency compared to the previous year. Asia/Pacific, on the other hand, experienced a slow start to the year. At local currency, sales came in 1% lower than in the previous year. This is primarily due to the weak demand in the first two months, which showed considerable signs of improvement in March.

In the first quarter, Symrise strengthened the growing business Consumer Health by entering into an exclusive partnership with Indevex Biotech to focus on joint research, as well as the development of new product concepts. With the partnership, Symrise has secured access to a Scandinavian biotech network with existing product partnerships.

2012 Outlook: Sales Forecast Increased
Based on the positive economic developments in the first quarter, Symrise is more confident for Fiscal Year 2012 than at the beginning of the year. If the economy continues to improve the Company sees good opportunities to exceed the expected market growth. Symrise expects additional impetus, particularly during the second half of the year, once the expanded production capacities for Menthol begin operation in Holzminden. Against this background, Symrise is raising its sales forecast and is now targeting sales growth between 3% and 5% for the year. However, the European sovereign debt crisis continues to represent an unsecure factor for both, the European and the global economy. In addition, Symrise expects raw material prices to remain volatile in 2012. Regardless, Symrise aims at sustainable, profitable growth and continues to target an EBITDA margin of about 20 percent for the 2012 fiscal year.

Key Figures of the Group

About Symrise:

Symrise is a global supplier of fragrances, flavorings, cosmetic active ingredients and raw materials as well as functional ingredients. Its clients include manufacturers of perfumes, cosmetics and foods, the pharmaceutical industry and producers of nutritional supplements.

Its sales of €1.58 billion in 2011 place Symrise among the top four in the global flavors and fragrances market. Headquartered in Holzminden, Germany, the Company is represented in over 35 countries in Europe, Asia, the United States and Latin America.

Symrise works with its clients to develop new ideas and market-ready concepts for products that form an indispensable part of everyday life. In doing so, Symrise combines its insights into consumer trends with cutting-edge technologies, focusing on innovative trend and lifestyle products that have additional practical value for the consumer.

Media contact:
Bernhard Kott
Phone +49 (0)5531 90-1721
bernhard.kott@symrise.com

Investor contact:
Tobias Erfurth
Phone +49 (0)5531 90-1879
tobias.erfurth@symrise.com