Chr Hansen reports mixed start to the year

Global bioscience company has reported 1% growth so far for 2019/20, with some brands still performing strongly despite difficult market conditions

Chr Hansen has reported organic revenue growth of 1% in the first three months of 2019/20. This was in line with expectations as it corresponded to European area growth of 1%. Reflecting the market, growth outlook for the rest of 2019/20 has now been narrowed to 4-6%.

The new growth outlook is set to continue for a while, as Chr Hansen has reported new preliminary long-term growth ambition have been set at mid to high single-digit sales growth per year until 2024/25.

Regarding specific sector growth, Food Cultures & Enzymes grew by 4%, Health & Nutrition (4)% and Natural Colours (1)%.

Enzymes

CEO Mauricio Graber said: “We have had a mixed start to the year, as expected. Food Cultures & Enzymes delivered good organic growth driven by all segments apart from probiotics, in line with our expectations.”

Graber explained that the recently launched enzyme for cheese making, CHY-MAX Supreme, has been very well received by customers and is off to a good start in spite of market conditions.

Health

“In Health & Nutrition, Animal Health showed very strong growth driven by the timing of sales in silage and good momentum in Cattle, whereas Human Health and Plant Health declined, as expected, due to the timing of orders,” esaid Graber

Colours

Graber clarified that thouhgh Natural Colours declined due to continued negative raw material price impacts and challenging market conditions, there was still strong growth in the FRUITMAX range.

"Even though Q1 was very much in line with our expectations, we are narrowing our guidance for 2019/20. We started the year with a cautious outlook due to the market challenges that we were facing, and those challenges have proven to be persistent. The end-market growth in Food Cultures & Enzymes is not improving, and we also see lower growth in dietary supplements.”

Graber explained Chr Hansen’s new growth ambitions are as a consequence of the lower end-market growth, and reflect the preliminary conclusions in on-going strategy review, which will be finalised in April 2020.

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