Givaudan has reported strong sales for the first quarter ending March 31 with results significantly boosted by the continuing integration of Quest International.
The Switzerland-based company achieved sales of CHF 1.05bn for the first quarter in 2008, an increase of 27.2 per cent in local currencies and 18.3 per cent in Swiss francs.
However, assuming Quest had been consolidated since January 1 2007 sales increased only 0.7 per cent in local currencies and decreased by 6.4 per cent in Swiss francs.
These lower figures also take into account the negative effects on sales of the reduction of the company's product portfolio. Excluding these effects sales grew 1.8 per cent in local currencies.
Fragrance sales driven by consumer products division
Overall the fragrance division recorded sales of CHF 489.1m, a 30.6 per cent increase in local currencies, 21.9 per cent in Swiss francs.
Sales were boosted by Quest and on a pro forma basis sales declined by 1.1 per cent in local currencies and 7.8 per cent in Swiss francs.
The company's fine fragrance division suffered, particularly the European and North American markets and Latin American sales in this division were flat.
In addition, the fragrance ingredients division recorded a drop in sales compared to last year's first quarter, mainly due to the portfolio streamlining - the company estimated the sales impact of discontinued fragrance ingredients amounted to CHF 3.3m.
However, the company's consumer products division reported strong growth with particularly good results coming from Latin America.
New deals in the region, particularly in Mexico was cited as boosting the region's performance, with sales in the other developing markets of Africa and Central and Eastern Europe continuing to grow.
Furthermore, growth in the Asian markets of China, India and Vietnam was reported as being particularly strong.
Flavour sales driven by beverage, savoury and snacks
The flavour division recorded sales of CHF 563.7m, an increase of 24.3 per cent in local currencies, however assuming the consolidation of Quest since January 1 2007 sales grew 2.2 per cent, again negatively affected by discontinued ingredients.
On a regional basis the company reported double digit growth in many of the developing markets of Asia and Europe thanks mainly to new partnerships and new clients in the regions.
Thailand, Indonesia, the Philippines and India reported double digit sales growth thanks to new partnerships in savoury, snacks and foodservice.
Sales of dairy and savoury ingredients grew particularly well in Europe, Africa and the Middle East whilst in North America it was good performance in the beverage sector that particularly contributed to the mid-single digit growth.
However, Latin American results suffered, especially in Brazil which the company said is due to the particularly strong results of last year's first quarter.
Sales growth on track if restructuring costs excluded
Looking to the year ahead the company expects its sales to grow in line with the market if the impact of changes to the product portfolio and business divestiture is excluded.
Furthermore, the company said it still believes it will reach the margin levels it enjoyed before the Quest acquisition by 2010 and will generate CHF 130m in acquisition related savings in 2008.