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Business Performance


Once more, sales for the Symrise Group grew faster than the overall market in 2013. The profitability of our business increased as well. We are confident in our ability to continue this trend of success moving forward.

Global Economic Conditions

The international economic landscape showed mixed developments over the course of 2013. The upturn of the past few months has been increasingly carried by the industrialized nations. In the USA, the growth rate increased from quarter to quarter. Meanwhile, the eurozone seems to have moved beyond its low point and be on the road to recovery. In 2013, the economy in the eurozone still decreased slightly by 0.4 %. By contrast, the German economy managed to grow 0.4 % in 2013. In the emerging markets, particularly China and India, economic growth accelerated substantially during the second half of the year. Overall, the global economy grew a modest 3.0 % in 2013.

Development of Essential Sales Markets

The Symrise Group is globally active in the market for flavors and fragrances as well as in the market for aroma chemicals and ­cosmetic ingredients. The market relevant for Symrise has a total volume of € 17.4 billion and is achieving average long-term growth of around 2 to 3 % per year.

Overview of Key Performance Indicators

Show table
Overview of Key Performance Indicators
in € million 2012 2013 Change in % Change in %
at local currency
Sales 1,734.9 1,830.4 6 10
EBITDA 338.9 373.1 10 13
EBITDA margin in % 19.5 20.4    
Net income 157.5 172.3 9  
Earnings per share in € 1.33 1.46 9  
Net debt (incl. provisions for pensions and similar
obligations) to EBITDA (Dec. 31) 1) ratio
2.4 2.0    
1) Prior-year figures adjusted as a result of changes to accounting policies (see note 2.2)

Sales and Earnings

The Symrise Group’s sales rose by 6 % to € 1,830 million in the 2013 fiscal year. Sales in the EAME region were up by 5 %. The North American region generated a sales increase of 11 % compared to the previous year. Business in the Asia/Pacific region was up about 4 % while the Latin America region increased sales by 2 %. Sales in emerging markets exceeded the previous year’s figures at local currency by 11 %. As in the previous year, the emerging markets’ share of total Group sales amounted to 48 %.

The Scent & Care division generated sales of € 960 million in 2013. Sales were therefore up 9 % on the previous year’s level. EBITDA amounted to € 195 million – up 21 % compared to the previous year. The EBITDA margin therefore amounted to 20.3 % in 2013 compared to 18.2 % in 2012. The Flavor & Nutrition division increased its sales by 2 % to € 870 million. EBITDA for the division was slightly higher than last year, amounting to € 179 million in 2013. The EBITDA margin amounted to 20.5 %, compared to 20.9 % in the previous year.

EBITDA – earnings before interest, taxes, depreciation and amortization on property, plant and equipment and intangible assets – of the Symrise Group increased by 10 % from € 339 million to € 373 million. The Group’s EBITDA margin, as based on sales, improved from 19.5 % to 20.4 %.

In 2013, the cost of sales rose by € 25 million, or 2 %, to € 1,060 million (2012: € 1,034 million). The disproportionately low rise in costs in view of the growth rate of sales can be mainly attributed to a lower raw material cost ratio and lower levels of depreciation and amortization. Gross profit increased by 10 % and amounted to € 771 million (2012: € 701 million). The gross margin was 42.1 %, 1.7 percentage points higher than in the previous year (40.4 %). Selling and marketing expenses were up by 8 % compared to the previous year, amounting to € 290 million (2012: € 267 million). This corresponds to 15.8 % of Group sales (2012: 15.4 %). R&D expenses increased by 12 % to € 127 million (2012: € 114 million). The R&D rate came in slightly above the previous year’s level at 6.9 % (2012: 6.6 %). Administration expenses increased by 5 % to € 85 million (previous year: € 81 million). Administration expenses as a share of Group sales improved again slightly from 4.7 % in 2012 to 4.6 % in the reporting year.

The Symrise Group’s net income rose by € 15 million to € 172 million in the 2013 fiscal year. With an unchanged number of shares, earnings per share improved from € 1.33 in the previous year to € 1.46 in the reporting year. The Executive Board and Supervisory Board will propose to increase the dividend from € 0.62 to € 0.70 per share at the Annual General Meeting on May 14, 2014.

Financial Position

As a result of the improved result, cash flow from operating activities in 2013 amounted to € 274.8 million, € 55.3 million, or more than 25 %, higher than in the previous year (€ 219.5 million). The Symrise Group’s liquidity increased by € 18 million to € 135 million as of December 31, 2013. Net debt decreased to € 744.8 million as of the reporting date for 2013, mainly due to higher cash balances and lower pension provisions. The ratio of net debt to EBITDA was 2.0 as of the 2013 reporting date and thus remains within the targeted corridor of 2.0 to 2.5.

Net Assets

The balance sheet total amounted to € 2,210 million as of December 31, 2013, an increase of € 60 million compared to the reporting date in the previous year. This was mainly due to a growth-related rise in inventories and higher trade receivables. The Symrise Group’s liquidity increased over the course of the year, by € 18 million to € 135 million. Symrise AG’s equity climbed by 8 % to € 951 million as of December 31, 2013. As of the 2013 ­reporting date, the equity ratio amounted to 43 %, after 41 % on December 31, 2012.

Sales Development of the Symrise Group (€ million)

Outlook

Estimates for the AFF market project 2 to 3 % growth worldwide for the year under way. Both divisions, Scent & Care and Flavor &  Nutrition, continue to target sales growth at local currency no­tably above the market rate. Assuming that raw materials prices remain at the level of 2013 and exchange rates do not change significantly from 2013, we once again anticipate an EBITDA margin of about 20 % for 2014 in both business divisions.

Thanks to our global positioning, innovative strength, good relationships with key customers and our unique product portfolio, we are confident that we will exceed the market’s annual rate of growth of 2 to 3 % in both 2014 and 2015. The Symrise Group will do everything it can to maintain and continue its sustainable and profitable growth course.

Sales by Region

Show table
Sales by Region

in € million

2012

2013

Change in %

Change in %
at local currency

EAME

785.4

828.3

5

7

North America

316.8

350.3

11

14

Asia /Pacific

404.5

419.6

4

10

Latin America

228.2

232.2

2

12

Total

1,734.9

1,830.4

6

10

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