By  on August 4, 2011

PARIS — Givaudan’s first-half net profits were 120 million Swiss francs, or $132.7 million, down 40 percent year-over-year, due to raw material cost increases.

Sales at the Vernier, Switzerland-based flavors and fragrances supplier declined 8.8 percent to 2 billion Swiss francs, or $2.21 billion, in the six months ended June 30. In local currencies, revenues gained 4.3 percent.

Givaudan’s fragrance division registered sales of 927 million Swiss francs, or $1.02 billion, down 8.8 percent versus the same prior-year period. In local currencies, the division’s revenues grew 3.9 percent.

Dollar figures are converted at average exchange for the corresponding period.

In a statement, Givaudan’s chief executive officer Gilles Andrier said the 4.3 percent local currency sales growth was in line with the company’s midterm guidance. “Raw material cost increases have affected our profitability,” he stated. “Givaudan has successfully implemented price increases in collaboration with its customers. These price increases started to become effective in the course of the second quarter.

“Givaudan’s business momentum continues to be strong with a full project pipeline and a further increased win rate,” continued Andrier. “We therefore are confident to achieve our ambitious midterm targets.”

Givaudan has set as an objective to grow organically between 4.5 and 5.5 percent yearly, assuming the market is up between 2 and 3 percent, and to continue gaining market share during the next five years.

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