PARIS — Givaudan reported first-half net profit rose 12.6 percent, spurred by strong volume gains and lower operational costs, and confirmed its mid-term guidance.
The Vernier, Switzerland-based fragrance and flavors supplier’s net income was 305 million Swiss francs, or $342.4 million, in the six months ended June 30. Its operating profit increased 11.8 percent to 422 million Swiss francs, or $473.7 million.
Sales declined 1.5 percent to 2.19 billion Swiss francs, or $2.46 billion. On a like-for-like basis, they advanced 4.5 percent.
Dollar figures are converted at average exchange for the period to which they refer.
Givaudan’s fragrance division registered a 1.2 percent decrease in revenues to 1.03 billion Swiss francs, or $1.16 billion. The firm’s flavor activity posted a 1.8 percent sales dip to 1.16 billion Swiss francs, or $1.3 billion.
The company reiterated its mid-term objectives of growing organically between 4.5 percent and 5.5 percent annually, assuming market growth of 2 percent to 3 percent.
Givaudan said it expects to target an annual free cash flow of 14 percent to 16 percent of sales in 2015.
“Givaudan confirms its intention to return above 60 percent of the company’s free cash flow to shareholders while maintaining a medium-term leverage ratio target below 25 percent,” the company stated.