Novonesis AS

Earnings Release • Aug 27, 2024

Interim Report H1 2024 h1 {font-size: 1.8em;}h2 {font-size: 1.6em}

Interim Report H1 2024

H1 organic pro forma sales growth at 7%, with pro forma adjusted EBITDA margin at 35.3%. Full-year outlook increased.  

• H1 organic pro forma sales growth of 7% and 8% on IFRS reported basis. 
• Q2 organic pro forma sales growth of 10%; Food & Health Biosolutions at 9%; and Planetary Health Biosolutions at 11%. 
• H1 pro forma adjusted EBITDA margin of 35.3%, with 34.0% for Food & Health Biosolutions and 36.3% for Planetary Health Biosolutions. H1 adjusted EBITDA on IFRS reported base of 35.5%. 
• H1 pro forma cash flow from operating activities was strong at EUR 540.7 million including a one-off item. 
• Integration is progressing very well; cost synergies continue to be on track with an 80% run-rate. Sales synergies on track to contribute from 2025 onwards. 
• Full organizational structure in place throughout regions and functions. 
• Interim dividend approved for 2024 at DKK 2.00/share (EUR 0.27). The dividend will be disbursed on September 3, 2024, with August 29, 2024, as the last trading day with dividend. 

Ester Baiget, President & CEO: “We continue to execute strongly across the business, and I am very pleased with the first half-year performance delivering a broad-based 7% organic sales growth and an adjusted EBITDA margin of 35.3% on a pro forma basis. We increase full-year expectations and now expect an organic sales growth of 7-8% with an adjusted EBITDA margin of 35.5%-36.5%. Synergy realization and prioritization continues to be in focus throughout the company. We see good progress on the integration, including high employee engagement, and the momentum with customers continues to be strong.” 

Pro forma sales and financial performance (H1 comments unless otherwise indicated) 

Novonesis realized 7% pro forma organic sales growth in H1 2024. Volumes increased ~5% and pricing contributed ~2%. Pro forma sales amounted to EUR 1,943.7 million, an increase of 5% (organic +7%, currency -1%, M&A -1%). Emerging markets grew 15% organically, and developed markets increased by 3%. The pro forma adjusted EBITDA margin increased by 150bps to 35.3%, and the gross margin, excluding PPA inventory step-up and PPA depreciation and amortization, increased by 70bps to 55.7%. Pro forma adjusted EPS was EUR 0.64 for H1 2024.

• Food & Health Biosolutions realized pro forma organic sales growth of 6% for H1 2024. Pro forma sales were EUR 875.5 million, an increase of 2% (organic +6%, currency -1%, M&A -3% from the merger-related divestment of the lactase enzyme business). Food & Beverages grew 8% organically, and Human Health was flat, in line with expectations.  
• Planetary Health Biosolutions realized pro forma organic sales growth of 8% for H1 2024. Pro forma sales were EUR 1,068.2 million, an increase of 7% (organic +8%, currency -1%). Household Care grew 15% organically, and Agriculture, Energy & Tech increased by 4%. 

2024 outlook* 

Novonesis increases its full-year sales and profitability outlook based on the first half year performance coupled with strong momentum going into the first months of the second half. Pro forma organic sales growth is now expected at 7-8% and the pro forma adjusted EBITDA margin is expected of 35.5%-36.5%. Both Food & Health Biosolutions and Planetary Health Biosolutions are expected to grow around the same range as indicated for the Group. 

* The outlook 2024 is based on 12 months pro forma numbers for the consolidated business. The 2024 Reported (IFRS) numbers for organic sales growth and adjusted EBITDA margin are expected to be similar, i.e. same outlook. Refer to Company Announcement no. 21 – June 17, 2024 for further details. 

Please read the full report in PDF.

Attachment

• 2024_27_H12024_Company_Announcement