Company Announcement No. 23/2020
CEO Mauricio Graber says: “2019/20 was a defining and extremely eventful year for Chr. Hansen. We launched our new 2025 Strategy to become a focused bioscience company and to grow a better world, naturally. We made three acquisitions over a short period of time – HSO Health Care, UAS Laboratories and, most recently, Jennewein – and made an agreement to divest Natural Colors. We are convinced that the long-term value creation from the changes in the portfolio is very attractive, and the changes will be clearly positive to EBITDA margin in the coming year, but will also give a slight short-term negative EBIT margin impact.
On top of all of that, everyone has had to manage through a pandemic which has posed unique challenges. We ended the year with 5% organic growth for the group, well within the guidance we provided at the beginning of the year. Organic growth accelerated in Q4, driven by Health & Nutrition which delivered impressive 18% growth. We also delivered on the earnings side and came in at almost 30% EBIT margin for the full year, and at 34.3% in Q4. Our free cash flow also developed strongly, but this was partly due to capex investments that were delayed during the second half of the year due to COVID-19.
Our three strategic lighthouses – bioprotection, plant health and Bacthera – have progressed well during the year, and we launched a fourth lighthouse, fermented plant bases, at the Capital Markets Day in August 2020, and a fifth lighthouse, human milk oligosaccharides, was announced in September 2020 in connection with the acquisition of Jennewein.
We have a cautious outlook for 2020/21, given the uncertainties that COVID-19 still creates, and it will also be a year where we focus on integrating the acquired businesses and making solid progress on our strategic agenda. We expect an organic growth rate of 5-8%, in line with our long-term ambition, with the highest contribution from Health & Nutrition. We expect an EBIT margin before special items of 27-28%, given the headwinds from currencies, a normalization of the cost base, and the slight headwind from the portfolio changes. At the same time, we remain firmly committed to our long-term ambition of delivering underlying EBIT margin expansion by 2025.”
Chr. Hansen will present the results at a conference call today at 10:00am CEST (9:00am GMT). Dial-in information and a slide deck are available beforehand on https://www.chr-hansen.com/en/investors
Full announcement attached.
For further information please contact:
Martin Riise, Head of Investor Relations, Tel: +45 5339 2250
Annika Stern, Investor Relations Officer, Tel: +45 2399 2382
Camilla Lercke, Head of Media Relations, Tel: +45 5339 2384
About Chr. Hansen
Chr. Hansen is a global, differentiated bioscience company that develops natural ingredient solutions for the food, nutritional, pharmaceutical and agricultural industries. At Chr. Hansen we are uniquely positioned to drive positive change through microbial solutions. We have worked for over 145 years to enable sustainable agriculture, cleaner labels and healthier living for more people around the world. Our microbial and fermentation technology platforms, including our broad and relevant collection of around 40,000 microbial strains, have game-changing potential. Matching customer needs and global trends we continue to unlock the power of good bacteria to respond to global challenges such as food waste, global health and the overuse of antibiotics and pesticides. As the world’s most sustainable food ingredients company, we touch the lives of more than 1 billion people every day. Driven by our legacy of innovation and curiosity to pioneer science, our purpose – To grow a better world. Naturally. – is at the heart of everything we do.