PARIS — Givaudan’s sales in the third quarter declined 0.9 percent, adversely impacted by the strong Swiss franc.
The Vernier, Switzerland-based fragrance and flavors supplier’s revenues reached 1.11 billion Swiss francs, or $1.15 billion, in the three months ended July 31. On a like-for-like basis, they rose 3.3 percent.
The company’s fragrance sales were 540 million Swiss francs, or $560.4 million, down 2.2 percent in reported terms and up 2 percent on a like-for-like basis. Its flavors revenues were 572 million Swiss francs, or $593.6 million, a 0.4 percent gain in reported terms and a 4.6 percent uptick on a comparable basis.
In the first nine months, Givaudan noted an improved performance in developing markets, where sales advanced 0.8 percent to 1.51 billion Swiss francs, or $1.58 billion, and by 3.3 percent on a like-for-like basis.
The company’s overall revenues in the period dipped 0.5 percent to 3.3 billion Swiss francs, or $3.46 billion. Its fragrance sales declined 1.5 percent to 1.56 billion Swiss francs, or $1.64 billion, while its flavors sales of 1.73 billion Swiss francs, or $1.82 billion, rose 0.4 percent.
Revenues generated in mature markets retreated 1.6 percent to 1.79 billion Swiss francs, or $1.88 billion.
Dollar figures are converted at average exchange for the period to which they refer.
Givaudan 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, and continued market-share gains.
The company expects to outgrow the underlying market and to target an annual free cash flow of 14 percent to 16 percent of sales by 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,” it stated.