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Symrise Swings to Profit

Flavors and fragrance maker Symrise reported Wednesday its net income was back in the black for 2007...

PARIS — Flavors and fragrance maker Symrise reported Wednesday its net income was back in the black for 2007 and announced it intends to acquire the Chr. Hansen flavors business.

Last year, Symrise’s net profits reached 97.4 million euros, or $133.5 million at average exchange, versus net losses of 89.8 million euros, or $123.2 million, in 2006.

The German firm, based in both Holzminden and Frankfurt, posted 2007 sales of 1.28 billion euros, or $1.75 billion, up 3.7 percent. In local currencies, revenues rose 6.2 percent. The company attributed the growth to Symrise’s focus on fast-growing segments and regions. Among drivers at the firm last year were “products with additional benefits,” which generated 31.5 percent of Symrise’s 2007 overall business.

Sales from the company’s scent and care division reached 671.3 million euros, or $920.2 million, a 3.7 percent on-year gain. In local currencies, the division’s revenues registered a 6.5 percent uptick.

Symrise’s earnings before interest and taxes margin came in at 21.3 percent last year, against 19.8 percent in 2006, thanks to a focus on high-margin products and efficient cost management, according to the firm. EBIT in 2007 increased to 272.1 million euros, or $373 million, 11.9 percent higher versus the prior year.

The firm said sales to its most important customers grew 5.6 percent, or 8.2 percent in local currencies. Business from the company’s top-10 clients represented 28 percent of Symrise’s total revenues last year.

Looking ahead, the firm’s executives expect Symrise to register average sales growth of 5 to 6 percent in 2008 and in 2009, plus to achieve further gains in EBITDA margin.

In other company news, Symrise has agreed to take over Horsholm, Denmark-based Chr. Hansen’s flavors business. The deal, whose terms were not divulged, is expected to be closed before the end of April, pending regulatory approval in the U.S. and Germany.

“This is Symrise’s biggest acquisition to date,” the company stated, adding once it’s given the green light, the buy will strengthen the firm’s presence in North America, where much of Chr. Hansen’s business takes place.