Corbion N.V. — Earnings Release 2011

Feb 21, 2012

CSM nv Corporate Communications

Nienoord 13 1112 XE Diemen PO Box 349 1000 AH Amsterdam the Netherlands The Netherlands

T +31 (20) 590 6320

E eva.lindner@csmglobal.com saskia.nuijten@csmglobal.com

I www.csmglobal.com

Press Release Press Release first half 2011

CSM: repositioning for profitable growth

Diemen, the Netherlands, 21 February 2012

date

CSM increased net sales by 4.1% to € 3,112.6 million for the full year, mainly driven by price increases to compensate for the higher input costs. The tough trading environment witnessed in 2011, remained in place for the fourth quarter. The strong price increases did not yet fully cover the increased raw material costs, putting our margins under pressure. EBITA, excluding one offs, amounted to € 150.8 million for the full year. CSM presents its conclusions from its business review today. This will reposition CSM for profitable growth through reducing the cost base, simplifying the organization and reshaping the portfolio in Bakery Supplies and decreasing the financial dependency of Purac on Bakery Supplies.

Key Facts

• Sales in 2011 increased by € 122.5 million (4.1%) compared to 2010. Currency effects, mainly US dollar driven, were a negative € 81.5 million. Acquisitions contributed € 94.0 million (3.1%). Organic sales growth was 3.7% for the full year, driven by a price/mix effect of 8.7% and a negative volume effect of 5.0%. Q4 sales increased by 1.5%, with organic growth of 0.9% to which all divisions contributed.
• EBITA in 2011 excluding one-off costs decreased by 30% to € 150.8 million (2010: € 215.2 million). EBITA including the one-off costs amounted to € 130.2 million. The net acquisition effect amounted to € 9.7 million (5.0%) and currency effects were a negative € 4.4 million. Q4 EBITA excluding one-off costs decreased by € 15.7 million.
• An impairment charge of € 249 million (net € 222.4 million after tax) related to a goodwill write-down for Bakery Supplies Europe, resulted in a net loss of € 174.3 million.
• Result after taxes, excluding one off costs and impairment charge amounts to € 62.8 million.
• Working capital increased by € 3.7 million to € 254.9 million.
• Cash flow from operating activities was € 148.0 million (2010: €188.6 million).
• Net debt decreased to € 615.6 million at the end of 2011, a reduction of € 15.4 million compared to 2010.
• Net debt/EBITDA ratio is 2.8 at year-end 2011.
• Dividend proposal of € 0.70 per common share either in cash or in stock.

Quarter 4				Full year
2011	2010	x € million	2011	2010
802.5	790.6	Net sales	3,112.6	2,990.1
40.3	56.0	EBITA excl. one-off costs*	150.8	215.2
27.4	48.6	EBITA	130.2	193.8
		Result after taxes	-174.3	99.3
		EPS (in €)	-2.64	1.41
5.0%	7.1%	EBITA margin (excl. one-off costs)**	4.8%	7.2%
		ROCE (excl. one-off costs)	6.8%	10.1%

Key Figures

*) The one-off costs comprise acquisition, integration and restructuring costs

**) EBITA margin is defined as % of net sales

Commenting on the 2011 full year results, Gerard Hoetmer, CEO of CSM, said:

"2011 was a very challenging year for us. We faced substantial raw material cost inflation in a difficult consumer environment impacting our volumes in an intensified competitive landscape. This put our 2011 results under severe pressure and led to a disappointing EBITA level.

During this year, we have seen an accelerating structural shift from the European traditional artisan bakery channel towards in-store-bakery and out-of-home channels. We had to recognize that our European Bakery Supplies business, based on its portfolio and positioning in 2011, would no longer have the cash flow generating capacity that justified the carrying value of its assets. This has unfortunately led to a non-cash impairment charge of € 249 million. This does not reflect the strengthening of the strategic position of our European Bakery Supplies activities as addressed in our business review.

We are committed to turning the challenges we face into opportunities by strengthening our competitiveness, lowering our cost base, improving our agility and making clear choices how we allocate our resources. As a consequence we have initiated a restructuring program and have done a business review, which we believe will result in a more focused business for the future.

Our business review has resulted in a distinct series of conclusions and actions for each division clustered into four key points:

• Reassessment of the cost base
• Simplifying the Bakery Supplies Organization
• Reshaping the Bakery Supplies portfolio (predominantly in Europe)
• Aggressively growing Purac while reducing its financial dependency on Bakery Supplies

We are rapidly implementing our restructuring program, announced and initiated in October 2011. This has led to a FTE reduction of 400 so far, progressing in line with our guidance of a total reduction of 500 FTE for the full cost reduction plan.

We have concluded that approx. 30% of our business in Bakery Supplies Europe is not matching our criteria. This means that these businesses should either enhance their performance or strategic action will follow. So far we have earmarked, as a part of this 30% of BSEU, at least € 100 million of sales to be divested, which we will pursue in 2012.

In Bakery Supplies North America we are strategically well positioned. Our portfolio has been significantly strengthened through Best Brands in 2010. Operational improvement is key for improving our profitability, for which we have the actions in place.

Purac is performing in line with its strategic intent, and should now grow faster and leverage its fermentation capability to be self-sustaining in growth and investments. Next to growing our baseline and enhancing agility, we will accelerate this path to self-sustainability by actively pursuing alliances and partnerships.

In light of exploiting the opportunities from our business review and reflecting on the 2011 results, we will propose a dividend of € 0.70 per common share.

It is clear that the trading environment in 2012 will remain very challenging. With our actions I am confident that CSM is better positioned to face these challenges head on to improve our long term profitability."

Business review

In our business review we assessed our businesses on several criteria, including market position and potential in terms of market leadership, capability to add value, profit contribution in conjunction with required capital, and growth potential.

The business review has led to a distinct set of conclusions and action points, which we will execute with highest priority;

Reassessment of the cost base

Already set in motion is our Relevance Cost reduction plan, as announced in October 2011, which we will further execute during 2012 to save at least € 30 million in 2012 and leading for the full program to a saving of € 50 million in 2013. As of the announcement of the plan we have implemented a number of actions such as: delayering and restructuring of Bakery Products NA resulting in a reduction of the number of FTE's of 330, reorganizations at a number of European Bakery Supplies organizations and further efficiency measures at Purac and at our headquarters. This has in total led to a reduction of approx. 400 FTE's in line with the realization of our guidance of a reduction of 500 FTE's for the full cost reduction plan.

Simplifying the Bakery Supplies Organization

Europe offers, through a rather complex business model, a wide portfolio of products in many countries with different market dynamics. Improving our performance requires a leaner and more agile business model, for which we have taken the necessary measures such as: implementation of a central category organization, simplifying the Eastern European organization and shifting resources to the growing segments. In North America the emphasis is on Bakery Products NA where we will continue with streamlining the organization following the merger between Brill and Best Brands.

Reshaping the Bakery Supplies portfolio

In our Bakery Supplies businesses we have identified the areas on which both Bakery Supplies Europe and Bakery Supplies North America focus to drive profitable growth. These include focus on the frozen segment, leveraging key account management, enhancing our value added positioning and addressing the underlying consumer trends, which are embedded in our strategy.

We will reshape the European portfolio and focus on the growing segments. In addition, we will exploit opportunities to strengthen or achieve market leadership in these growing segments through alliances and acquisitions. Given our traditional stronghold in artisan, our European businesses are experiencing the impact of the shift in market channels to the fullest extent. Next to operational measures, we will make changes to the portfolio to improve long term profitability.

The criteria used for the business review have driven the decision making in our portfolio focus. We have concluded that approx. 30% of our business in Bakery Supplies Europe is no longer matching our criteria. This means that these businesses should either enhance their performance or strategic action will follow. As a first consequence, as a part of this 30% of BSEU at least € 100 million of sales has already been identified to be divested, which we plan to pursue in 2012.

The results of the business review in North America have reinforced our existing strategy and confirmed that we are strategically well positioned. We strengthened our portfolio significantly through Best Brands in 2010 and now have leading positions in all our strategic segments.

The business review has confirmed our strategic focus to continue to grow in a limited number of emerging markets.

Aggressively growing Purac while reducing its financial dependency on Bakery Supplies

Purac has many strategic opportunities to leverage its fermentation capability in both horizontal and vertical extension of the business. Our aim is for Purac to realize its potential and to accelerate growth to become selfsustaining in financing its growth and investments and to be less dependent on the cash flow of Bakery Supplies. To achieve this, Purac must grow to a size that organic growth alone cannot deliver. We will pursue alliances and partnerships to further exploit our capabilities in the field of fermentation, downstream processing and bio-mass applications.

Outlook 2012

Consumer confidence is still very fragile in many of our main markets and could continue to have an impact on demand. In addition, volatility of raw materials pricing is likely to remain. Although there has been some easing for a number of soft commodities, it is too early to say whether this trend will persist.

Within the challenging economic environment in many of the countries where we operate, we have initiated actions to re-position CSM for profitable growth in the years to come. As a consequence our business portfolio will go through significant reshaping over the course of the year.

Our restructuring program, initiated in October 2011, will deliver net savings of € 30 million in 2012, rising to € 50 million in 2013. However, this will be partly offset by some cost inflation and increased production expenses as the new lactide factory in Thailand has commenced production but will not yet be fully utilized in 2012.

We will be emphasizing capital control; working capital will continue to be managed tightly although it will as usual show a seasonal pattern with most of the cash flow being generated in the latter half of the year. Investments in fixed assets and acquisitions will be aligned with our cash flow generation.

Given the economic uncertainties, volumes are not expected to pick up on the short term, and our efforts on implementing the strategic and operational re-alignment, 2012 will be a transitional year for CSM. As the rise in raw materials costs and the decline in consumer demand accelerated in the course of 2011, it is evident that the first half of 2012 will face a tough comparison with the first half of 2011.

Financial commentary

Quarter 4 of 2011

• Sales increased by 1.5% to € 802.5 million. Organic sales growth contributed by all divisions was € 7.7 million (0.9%). Volumes sold decreased by 8.0% as a result of volume decline in all divisions.
• Margins were negatively impacted by a rise in raw material costs, which have not been fully absorbed yet by increased selling prices or reformulations of our products. Compared to Q3 and Q2 of 2011 the impact has diminished as a result of increased selling prices. We remain focused on translating this into our pricing, in parallel with closely managing cost volatility through our procurement strategies.
• EBITA (before one-off costs) in the fourth quarter amounted to € 40.3 million, versus € 56.0 million in the same quarter in 2010. Currency contributed € 0.2 million positively.
• An impairment charge was recorded on the carrying value of the BSEU goodwill of € 249.0 million.

Quarter 4					Full Year
Organic	Volume	Price/Mix		Organic	Volume	Price/Mix
1.1%	-9.7%	10.8%	BSNA	3.3%	-7.1%	10.4%
0.3%	-7.0%	7.3%	BSEU	4.4%	-2.6%	7.0%
2.3%	-1.8%	4.1%	Purac	3.7%	-0.9%	4.6%

The breakdown of the organic growth is as follows:

In the fourth quarter of 2011, net sales increased by € 11.9 million to € 802.5 million.

Acquisitions contributed € 3.0 million and currency effect amounted to € 1.2 million. Organic sales growth was 0.9% (€ 7.7 million) mainly driven by the transfer of higher raw material prices to the market; overall volume development had a negative impact on organic growth. BSEU saw a decline in volumes, in particular in our bakery fats product group in the industrial and artisan channel, as market conditions required continuous tradeoffs between margins and volumes. At BSNA relatively the largest share of the volume loss came from traded products where we managed on margins.

Impairment of BSEU Goodwill

The profitability of our European bakery activities decreased considerably in 2011. Margins were impacted by higher raw material costs and volumes sold declined, especially in our ingredients business for the artisan and industrial channels. All parties in the bakery industry had to deal with strongly increased raw material costs, which have been translated into higher prices in all bakery channels, which subsequently led to higher selling prices for the end-consumer. Combined with the difficult economic environment and the reduced spending power of consumers, we have seen the structural shift from the traditional artisan bakery channel towards the cheaper and more convenient supermarket channel accelerating in 2011.

The carrying amount of the European bakery supplies activities were valued at € 695 million, of which the largest part (€ 517 million) is goodwill. This goodwill mainly relates to the bakery supplies activities acquired in 2000. The goodwill paid for these activities was largely based on the very profitable ingredients position in the artisan and industrial channels. The Bakery supplies activities delivered substantial cash flows over the past years. However, due to the structural changes in the market place, including the shift from artisan to in-store bakeries and out-ofhome channels, the cash generating capacity of the European Bakery Supplies activities has diminished to an extent that an impairment of the book value is required.

Multiple scenario analyses have been performed which resulted in a non-cash impairment charge of € 249.0 million on the BSEU goodwill. In accordance with IFRS, when making these analyses we have taken into consideration only the current asset base and activities and did not reflect the actions resulting from our business review.

Full year 2011

Results

Net Sales

Net sales were 4.1% higher in 2011 compared to 2010, to € 3,112.6 million (2010: € 2,990.1 million). Acquisitions contributed € 94.0 million (3.1%). Exchange rate differences, especially the US dollar, negatively impacted net sales by € 81.5 million (-2.7%). Adjusted for the acquisition effect and currency effects, organic growth was € 110.0 million (3.7%).

Breakdown of organic growth:

Bakery Supplies North America	3.3%
Bakery Supplies Europe	4.4%
Purac	3.7%

The organic growth development for Bakery Supplies North America was driven by increased selling prices(10.4%) to compensate for higher raw materials costs, largely offset by lower volumes sold (7.1%) as a result of the recessionary environment. Europe showed a comparable picture, with increased selling prices contributing 7.0%, while the decline in volumes sold was 2.6%.

Also at Purac, organic growth was driven by increased selling prices (4.6%) to compensate for higher input costs, being offset by a negative volume effect of 0.9% due to increased competition and a weaker economic climate.

EBITA

EBITA excluding one-off acquisition and integration costs decreased by € 64.4 million, or 29.9%, to € 150.8 million (2010: € 215.2 million). EBITA including the one-off costs (related to the restructuring program, the integration of the acquisition of Best Brands and the impairment of some tangible fixed assets) amounted to € 130.2 million. The net acquisition effect amounted to € 9.7 million. EBITA has been negatively impacted by € 4.4 million due to the translation of income in foreign currencies to the euro.

Breakdown of (the change in) EBITA (excluding one-off costs):

millions of euros	2011	2010	+/-%
BSNA	94.9	123.4	-23.1%
BSEU	38.4	61.8	-37.9%
Purac	46.1	56.6	-18.6%
Corporate	-28.6	-26.6	-7.5%

Development of the results per division is explained in the divisional sections.

The impact of the increased raw material costs in 2011 versus 2010 amounted to € 255 million, increased selling prices of € 231 million compensated these additional costs to a large extent.

One-Off costs

The costs that were identified to be incidental and outside the normal course of business were:

• Costs relating to the Best Brands integration for an amount of € 6.4 million (2010 € 21.4 million.)
• Costs recorded in relation to the restructuring project Relevance for an amount of € 11.1 million.
• Impairment of the pilot lactide plant at Purac Spain for an amount of € 3.1 million, as a result of the start-up of the new lactide plant in Thailand
• Goodwill impairment BSEU for an amount of € 249 million

Financial Income and Charges

Net financial charges increased by € 2.1 million to € 29.7 million. The higher expenses are mainly due to lower positive fair value effects of derivatives and the full year effect of the private placement of US \$ 300 million, concluded in the 4th quarter of 2010 following the Best Brand acquisition and which included a shift into more long term and higher interest funding. In 2010 interest charges were negatively influenced by one-off refinancing costs. For 2012 we expect, based on constant currencies, our interest expenses to be in line with 2011.

Taxes

Net tax showed a positive effect of € 5.0 million compared to an expense of € 31.2 million in 2010. The tax affect has been significantly impacted by the goodwill impairment charge. Excluding the goodwill impairment effect, net tax as percentage on income before tax is 31.0% (in 2010: 23.9%). For 2012, the tax burden is expected to be in the range of 25% to 30%.

Net result

Result after taxes is showing a loss of € 174.3 million, significantly impacted by the net effect of € 222.4 million of the impairment charge of BSEU goodwill. Excluding the impairment charge, the net result would have ended at a profit of € 48.1 million, a decrease of € 51.2 million compared to the net result of 2010. The EBITA decline in 2011 has been partly compensated by lower taxes and lower amortization expenses.

Balance Sheet

Capital employed including goodwill (on historical costs) increased by € 72.3 million to € 2,239.9 million. The main movements were:

millions of euros
Net capital expenditure on (in)tangible fixed assets	91.7
Depreciation / amortization of (in)tangible fixed assets	-102.7
Impairment fixed assets	-3.1
Acquisition	11.8
Investment financial fixed assets	8.8
Tax positions	21.5
Provisions	10.4
Working capital increase	3.7
Exchange rate differences	29.2

The acquisition effect relates to the acquisition of Classic Cakes Ltd. in the UK in January 2011. The major capital expenditures in Bakery Supplies, besides regular replacement of fixed assets, comprised of investments in frozen and ingredients manufacturing efficiency and capacity increase. The largest capital expenditure at Purac was the final part for the new PLA factory in Thailand. Furthermore, important investments in IT have been made for an improved global IT structure and functionality and further standardization of IT systems within our Bakery Supplies organization.

We expect, at constant currencies depreciation and amortization expenses of fixed assets in 2012 to be comparable to 2011.

Working capital increased by € 3.7 million to € 254.9 million. The acquisition and currency effect contributed respectively € 0.8 million and € 3.3 million. The net effect of increased working capital is € 0.4 million.

Equity before profit appropriation decreased by € 168.9 million to € 948.3 million. The main movements were:

• The subtraction of the negative result after taxes of € 174.3 million, including the impairment charge of intangible fixed assets of € 249 million;
• A decrease of € 23.2 million in connection with the dividend for financial year 2010;
• Positive exchange rate differences of € 22.5 million due to the translation of equity denominated in currencies other than the euro;
• Positive movement of € 5.3 million in the hedge reserve.

At the end of 2011 the ratio between balance sheet total and equity was 1:0.4 (2010: 1:0.4).

Cash Flow

Cash flow from operating activities decreased by € 40.6 million compared to 2010 amounting to € 148.0 million. This is the balance of mainly a lower result after taxes, and a negative impact of the movement in working capital and provisions of € 1.7 million, offset by lower taxes and interest paid of € 17.5 million.

The cash flow needed for investment activities was € 102.9 million in 2011. Next to the acquisition of Classic Cakes Ltd and the investment in the Tunisian Joint Venture, capital expenditure contributed the most with € 95.2 million to this usage of cash flow.

Cash flow from financing activities amounting to € 49.4 million negative includes the dividend payments of € 23.2 million as well as repayments and proceeds of loans amounting to € 26.2 million.

Financing

At the end of 2011 the net debt position was 2.8x EBITDA (2010 2.1x) and the interest cover for 2011 was 7.6x (2010 9.7x). We continue to stay well within the limits of our financing covenants.

The net debt position amounted to € 615.6 million at the end of 2011, a decrease of € 15.4 million compared to the end of 2010. This is the net balance of the following major movements:

• a positive cash flow from operating activities before working capital and provisions of € 206.2 million;
• a net investment in (in)tangible fixed assets of € 83.1 million;
• dividend payments of € 23.2 million;
• the acquisition of Classic Cakes Ltd and the investment in the Tunisian Joint Venture of total € 19.8 million;
• tax paid on profit of € 19.6 million;
• interest payments of € 29.4 million;
• an increase of € 9.2 million due to working capital and provisions.

On 31 December 2011 the interest-bearing non-current liabilities amounted to € 726.9 million (31 December 2010: € 745.7 million). The average effective interest rate of the non-current liabilities outstanding on 31 December 2011 was 3.5% and the average remaining term 4.0 years (31 December 2010: average interest rate 3.7 % and average term 4.5 years).

Reservation and Dividend Policy

The reservation policy is aimed at creating and retaining sufficient financial scope to realize the growth objectives while maintaining healthy balance sheet ratios. CSM intends to add or charge the profit or loss to the company reserves after payment of the statutory dividend on financing preference shares and after deduction of the proposed dividend on common shares. Issues such as financing requirements, acquisitions, divestments, reorganizations or other strategic considerations can lead to adjustments in the reserves and the reservation policy.

The amount of dividend on common shares and the type of dividend that the company will pay to its shareholders depend on the financial results of the company, the business climate and other relevant factors. In principle, CSM aims at an even and, if possible, upward trend in the dividend.

Dividend Proposal

Upon adoption of the financial statements holders of cumulative financing preference shares will receive the statutory dividend. The dividend proposal on common shares will be presented to the General Shareholders' Meeting to be held on 7 May, 2012.

In light of exploiting the opportunities from our business review and reflecting on the 2011 results, the dividend proposed on common shares amounts to € 0.70 per share. Shareholders will be able to choose between a cash and stock dividend charged to the reserves. The dividend in common shares is exempt from Dutch dividend taxes.

For more information, please contact:

Press & Analysts:

Press: Saskia Nuijten/ Eva Lindner, Communication Director, tel. +31 (0)20 5906320 Analysts and investors: Ian Blackford, Investor Relations Manager, tel. +31 (0)20 5906349 / cell phone +44 (0)7767 227506

Appendices:

• 1. Business developments per segment
• 1. Key figures
• 1. Consolidated income statement
• 1. Consolidated income statement before one-off costs
• 1. Consolidated statement of financial position
• 1. Consolidated statement of change in equity
• 1. Consolidated statement of cash flow
• 1. Segment information
• 1. Notes

Press conference and analyst presentation (Webcast)

A press conference will be held at the premises of CSM (Nienoord 13, Diemen, The Netherlands) from 09.30 hours (CET) on Tuesday, February 21, 2012.

The presentation that is provided to analysts and investors at the same location can be followed live via www.csmglobal.com from 11.00 hours (CET). The slides, used during the presentation can be downloaded from our website.

Background information

CSM is the largest supplier of bakery products worldwide and is global market leader in lactic acid and lactic acid derivatives. CSM produces and distributes an extensive range of bakery products and ingredients for artisan and industrial bakeries and for in-store and out-of-home markets. It also produces a variety of lactic acid applications for the food, chemical and pharmaceutical industries. CSM operates in business-tobusiness markets throughout Europe, North America, South America, Asia and Africa, generates annual sales of € 3.1 billion and has a workforce of around 9,800 employees in 28 countries. CSM is listed on NYSE Euronext Amsterdam. For more information: www.csmglobal.com.

1. Business developments per segment

• Bakery supplies

Quarter 4			Full year
2011	2010	x € million	2011	2010
702.9	693.8	Net sales	2,705.4	2,589.7
36.9	48.5	EBITA excl. one-off costs *	133.3	185.2
31.1	41.1	EBITA	120.9	163.8
5.2%	7.0%	EBITA margin (excl. one-off costs)**	4.9%	7.2%
		ROCE in % (excl. one-off costs)	7.3%	10.2%

*) The one-off costs comprise acquisition, integration and restructuring costs

**) EBITA margin is defined as % of net sales

Developments and Results in 2011

The markets in which Bakery Supplies achieves the majority of its sales, the US market and the Western and Southern European markets were seriously impacted by the economic downturn. Consumer confidence was affected by the turbulence in worldwide markets, which in turn negatively impacted their behavior and spending. As of Q2 we were confronted with consumers willing to spend less on their purchases. At the same time, we had begun to implement significant price increases to compensate for surges in raw material costs. The rise in raw material prices that began in 2010 reached its peak around the mid of 2011. Since then, we have seen some pressure easing, although both volatility and price levels have remained high overall. While we have significantly increased our selling prices, on balance this was not sufficient to fully compensate for the increased raw material costs. As announced in October 2011, we initiated a restructuring program to reduce our cost base and thereby restore profitability. In addition we conducted a business review to realign our focus and be able to deliver on our financial commitments.

Market Situation

Recessionary economic situation in North America and Europe

The economic downturn in the United States and Europe and the ongoing financial crisis have weakened demand. The fall in consumer confidence had led to even lower consumer spending. Although we provide daily consumer needs, this recessionary environment has inevitably impacted demand. Following the consumers' behavior, many of our customers have been trading down to cheaper alternatives within our ingredient and pastry assortment, leading to shifts in product mix. In addition, we have seen consumers shifting towards low priced sales channels, where we are less strongly positioned. Moreover, both our customers and consumers were mindful about limiting waste to reduce costs.

This all resulted in a decline in volumes sold.

Raw Material Price Volatility

Since 2007 raw materials markets have seen continuous volatility with a sharp upward underlying trend. This movement is driven by a number of developments: rising demand from developing countries driven by increased consumer food spending, increased demand for vegetable oils and fats from the bio-fuel industry, fluctuations in harvests around the world and increasing investments from financial markets in soft commodities. Responding efficiently to changes in raw material prices has been critical to our company, and the investments made in

previous years towards professionalizing our global procurement team has mitigated the effects of these rises for us and our customers.

We took our responsibilities as market leader by achieving substantial price increases. In addition, we reformulated our product offering where appropriate to safeguard profitability and offer choice to our customers. Despite these important joint efforts of our procurement team, our sales departments and our R&D organization, we could not fully compensate for the effects of the increases in raw materials in 2011.

Increased shift in importance of the supermarket as primary bakery channel

Supermarkets are continuously increasing their share of total consumer spending in bakery at the expense of artisan channels. The challenging economic environment has accelerated this trend. The artisan baker channel is traditionally a stronghold for CSM; we have a significant market share particularly in Western and Southern European countries. Although we have strengthened our position in the in-store-bakery channels in supermarkets, particularly in Europe, this could not fully mitigate the impact of declining volumes in the artisan market.

Restructuring

Both Bakery Supplies divisions have embarked on our company-wide restructuring program, which was initiated as a response to the difficult trading environment and the increase in raw material costs in October 2011. This program targets improved effectiveness and efficiency of our operations. All activities and related expenses and investments are being scrutinized and assessed in relation to their value adding capacity. Measures resulting from this restructuring program range from closures of production sites and sales offices to cuts in discretionary expenses. In total, the restructuring program should deliver a cost reduction € 30 million in 2012, with the vast majority of these cost savings to be delivered by our Bakery Supplies divisions.

• Bakery Supplies North America

Quarter 4				Full year
2011	2010	x \$ million	2011	2010
579.1	574.2	Net sales	2,263.8	2,077.3
32.4	44.6	EBITA excl. one-off costs *	132.0	163.6
28.1	34.6	EBITA	118.4	135.2
5.6%	7.8%	EBITA margin (excl. one-off costs)**	5.8%	7.9%
		ROCE in % (excl. one-off costs)	9.7%	12.7%

*) The one-off costs comprise acquisition, integration and restructuring costs

**) EBITA margin is defined as % of net sales

Quarter 4			Full year
2011	2010	x € million	2011	2010
428.9	423.5	Net sales	1,627.6	1,567.1
24.1	32.9	EBITA excl. one-off costs *	94.9	123.4
20.9	25.5	EBITA	85.1	102.0
5.6%	7.8%	EBITA margin (excl. one-off costs)**	5.8%	7.9%
		ROCE in % (excl. one-off costs)	9.7%	12.7%

*) The one-off costs comprise acquisition, integration and restructuring costs

**) EBITA margin is defined as % of net sales

Sales increased by US\$ 186.5 million (9.0%) to US\$ 2,263.8 million in 2011, mainly driven by our price increases (10.4%). The full year consolidation of Best Brands, acquired 19 March 2010, contributed US\$ 114.7 million (5.3%) to our sales value. The increase in sales was for a large part offset by a drop in volumes sold of 7.1%. This volume decline is predominantly the result of lower consumer spending as a reaction to the tough economic environment.

In Q4, sales slightly increased to US\$ 579.1 million. Organic sales growth was 1.1%, due to a positive price/mix effect of 10.8%, largely offset by a negative volume effect of 9.7%.

Margins were negatively impacted as selling prices did not yet fully compensate for the increase in raw material costs. In addition, lower volumes sold also had an effect on the absorption of fixed costs. In the second half of 2011 we finalized the closures of two factories, of which one was a former Best Brands facility, to deliver on anticipated synergies following the integration of Best Brands and as part of our company-wide cost reduction program to improve profitability. The overall restructuring measures in BSNA led to a reduction of headcount of 330 in total.

As a consequence, EBITA before one-off costs came down to US\$ 132.0 million (2010: US\$ 163.6 million) for the full year, or as a percentage of sales to 5.8% (2010: 7.9%). Q4 EBITA before one-off costs came down to US\$ 32.4 million compared with US\$ 44.6 in Q4 2010.

Capital employed has been impacted by the increased raw material costs on inventory and indirectly on receivables due to increased selling prices. A major effort has been undertaken by our people to reduce working capital and to limit the investments in fixed assets resulting in a reduction of US\$ 38.4 million to a total of US\$ 1,313.7 million. Our average working capital cash conversion cycle remained fairly stable and ended at 30.2 days, from 29.8 days in 2010, indicating continued cash discipline within our organization, despite the upward

pressure due to higher raw material costs and increased selling prices. Capital expenditures amounted to US\$ 29.2 million, US\$ 4.0 million less than depreciation. No major capital expenditures took place in 2011. Mainly as a result of the lower EBITA, ROCE before one-off costs came in at 9.7% compared to 12.7% in 2010.

• Bakery Supplies Europe

Quarter 4			Full year
2011	2010	x € million	2011	2010
274.2	270.3	Net sales	1,077.8	1,022.6
12.8	15.6	EBITA excluding one-off costs*	38.4	61.8
10.2	15.6	EBITA	35.8	61.8
4.7%	5.8%	EBITA margin (excl. one-off costs)**	3.6%	6.0%
		ROCE (in %)	4.6%	7.4%

*) The one-off costs relate to restructuring costs

**) EBITA margin is defined as % of net sales

Bakery Supplies Europe faced the same difficult circumstances as BSNA, but in addition, especially the growing uncertainty in the Euro zone and its consequences for consumers, accelerated the decline in volumes sold throughout 2011. For the total year, sales value increased by € 55.2 million, positively impacted by higher selling prices of 7.0 % on average, but this was mostly offset by lower volumes sold of 2.6%. This decline in volumes sold was mainly caused by lower sales in the artisan and industrial channels. In the in-store-bakery and out-ofhome channels we saw a small increase. Our margins were further compressed by higher raw material costs that were not fully compensated by higher selling prices and product reformulations.

In Q4, sales slightly increased by 1.4% to € 274.2 million. Organic growth was 0.3%, driven by price increases (7.3%), largely offset by a negative volume effect of 7.0%.

We have responded to these lower margins by reducing costs wherever possible, although this could not prevent that EBITA before one-off costs for the full year ended at € 38.4 million, a substantial decrease from € 61.8 million in 2010. EBITA as percentage of sales decreased to 3.6% from 6.0% in 2010. Further cost reductions will be an important driver to improve our operating performance.

Q4 EBITA before one-off costs showed a decrease of 17.9% to € 12.8 million, as a consequence of higher aw materials costs not fully covered by price increases and lower volumes.

In 2011, we made a correction on the carrying value of our assets. The European bakery activities were valued at € 695 million, of which the largest part (€ 517 million) is goodwill. This goodwill mainly relates to the bakery activities acquired in 2000. The goodwill paid for these activities was largely based on the very profitable ingredients position in the artisan an industrial channels. The Bakery Supplies activities delivered substantial cash flows over the past years. However, due to the structural changes in the marketplace, including the shift from artisan to in-store-bakeries and out-of-home channels, the cash generating capacity of the Bakery Supplies activities has diminished to such an extent that an impairment on the book value is required. This has led to an impairment charge of € 249 million.

We were able to decrease working capital at year end to € 58.1 million (2010: € 59.3 million). The positive impact of lower inventory volumes and strict cash control more than compensated the effect of higher raw materials and selling prices. Our average cash conversion cycle ended at 31.1 days, from 24.7 days in 2010 reflecting the sharp increase during the year as a result of raw material and selling prices. Net capital expenditure on fixed

assets amounted to € 18.9 million, which was below the depreciation level of € 22.4 million. No major large capital expenditures have been made with the exception of investments in IT. Our ROCE before one-off costs decreased mainly as a result of lower EBITA to 4.6% in 2011.

• Purac

The development of Purac's activities was mixed. The chemical and pharma market continued to perform strongly, but the food market was under pressure due to lower consumer spending and competition from lower cost in use alternatives as substitutes for its preservation products. Purac made progress in its bioplastics activities, although this has not yet translated into sizable commercial contracts. Its global presence exposes Purac to faster growing economies, which provided a degree of relief from the recessionary environment in the United States and Europe.

Raw material price volatility

Since 2007 raw materials markets have seen continuous volatility with a sharp upward underlying trend. This movement is driven by a number of developments, which include: new demand from developing countries driven by increased consumer spending in food; increased demand from the bio-fuel industry; fluctuations in harvests around the world and; increased interest from financial markets to in raw materials as an investment category. Responding efficiently to these movements in raw material prices is critical for our business; the investments made over the past years in our global procurement team have certainly mitigated the effects for CSM.

Recessionary economic situation in North America and Europe

In addition to the difficult economic conditions in the United States and many European countries, the slowdown has been aggravated by the financial crisis. This has had a negative impact on consumer confidence in these countries.

Purac's worldwide presence enabled us to benefit from the growth in the Asian and South American markets.

Progress bioplastics strategy

In 2011 we continued our strategic path in bioplastics, although we recognize that it takes time to commercialize our proposition given the scale of technological advancement offered and the time required by potential customers to develop application capabilities.

The construction of our new lactide factory in Thailand has been successfully completed and has started delivering to customers as of early 2012. Based upon current forecasts the capacity utilization of this factory will grow throughout 2012, but not at the levels that will deliver an appropriate level of return in the very short-term. We continue to see strong signs that the market is developing, for example demonstrated by the announced commitment of several leading global brands towards green packaging. In 2011 we continued to expand our organization to support the growth of bioplastics, a process that commenced in 2010. We are convinced that we have the organization, the capabilities and the products in place to achieve commercial successes in 2012 and beyond, but progress and timing of customer investment are not fully under our control. We also continue to commit substantial resources to the next generation of plastics from lactides, which will no longer use food stock as a raw material but will be produced from bio-mass, such as waste material.

Quarter 4			Full year
2011	2010	x € million	2011	2010
99.4	96.8	Net sales	407.2	400.4
11.0	12.0	EBITA excluding one-off costs*	46.1	56.6
7.9	12.0	EBITA	41.9	56.6
11.1%	12.4%	EBITA margin	11.3%	14.1%
		ROCE (in%)	13.3%	18.8%

Sales of Purac increased from € 400.4 million to € 407.2 in 2011, a combination of higher sales within Chemicals and Pharma segments and lower sales in Food. In our Chemicals and Pharma segments we benefited from the continuously increasing demand for more natural products replacing mineral oil based products. The strong presence of this segment in Asia and Latin America further contributed to the good performance.

In our food segment we were confronted with lower volumes as well as pressure on average pricing as a result of competition from lower cost in use chemical derived preservation products in the United States. These products were legally not allowed in the US market until recently. We have responded to this by expanding our preservation product portfolio to be able to meet the needs of all segments of the market; targeting both the low cost in use segment with a newly launched product line as well as the premium fully natural clean label segment.

In Q4 Purac sales increased by 2.7% to € 99.4 million, mainly driven by price increases and volume growth in the Chemicals and Pharma segments, offset by a volume decline in Food. Organic sales growth was 2.3%, driven by a positive price/mix effect (4.1%) and lower volumes sold (1.8%).

Our margins came under pressure from increasing raw material costs, which could not be fully compensated by price and mix changes in the short-term. Purac's results were further impacted by increased expenses of approx. € 2.4 million to expand the organization to develop and market bioplastics. As a result EBITA before one-off costs decreased by € 10.5 million to € 46.1 million (2010: € 56.6 million), and as a percentage of sales to 11.3% (2010: 14.1%).

Q4 EBITA before one-off costs decreased by € 1.0 million to € 11.0 million, mainly due to investments to strengthen the organization to facilitate future growth and higher raw material prices that could not be fully compensated in the short-term.

Capital employed at year end increased to € 342.2 million from € 332.9 million. Capital expenditures exceed by € 12.8 million our annual depreciation charge of € 25.5 million. From the total capital expenditures of € 38.3 million, € 18.6 million was related to the new Thai lactide facility. Working capital increased by € 11.7 million to € 78.2 million, mainly as a result of higher raw material costs. Our average cash conversion cycle ended at 83.7 days, from 70.9 days in 2010, which is mainly the result of higher inventories and lower payables during the year. ROCE before one-off costs decreased from 18.8% in 2010 to 13.3 % in 2011.

2. Key figures

millions of euros	2011	2010
Income Statement:
Net sales	3,112.6	2,990.1
EBITA excluding one-off costs	150.8	215.2
EBITA	130.2	193.8
Operating result	-149.5	158.1
EBITDA excluding one-off costs	222.8	286.8
Result after taxes	-174.3	99.3
Balance sheet:
Non-current assets	1,558.9	1,791.1
Current assets excluding cash and cash equivalents	740.4	717.5
Non-interest-bearing current liabilities	478.5	483.1
Net debt position 1	615.6	631.0
Provisions	256.9	277.3
Equity	948.3	1,117.2
Key data per common share
Number of issued common shares	67,658,699	65,998,134
Number of common shares with dividend rights	67,580,372	65,873,803
Weighted average number of outstanding common shares* Price as at 31 December	67,557,754 12.08	67,515,917 26.19
Highest price in calendar year	26.88	26.27
Lowest price in calendar year	9.25	18.55
Market capitalization as at 31 December	816	1,725
Earnings in euros 2 *	-2.64	1.41
Diluted earnings in euros 2 *	-2.64	1.40
Cash flow from operating activities per common share, in euros 2 *	2.13	2.73
Other key data
Cash flow from operating activities	148.0	188.6
Depreciation/amortization fixed assets	102.7	107.3
Capital expenditure on (in)tangible fixed assets	91.7	83.2
Number of employees at closing date	9,843	9,664
Number of issued cumulative preference shares	2,983,794	2,983,794
Equity per share in euros 3	13.44	16.22
Ratios
EBITA margin % 4	4.2	6.5
Result after taxes / net sales %	-5.6	3.3
ROCE % 5	5.9	9.1
Net debt position/EBITDA 6	2.8	2.1
Interest cover 7	7.6	9.7
Balance sheet total : equity	1:0.4	1:0.4
Net debt position : equity	1:1.5	1:1.8
Current assets : current liabilities	1:0.6	1:0.6

*previous year is restated for stock dividend

1 Net debt position comprises interest-bearing debts less cash and cash equivalents.

2 Per common share in euros after deduction of dividend on cumulative preference shares.

3 Equity per share is equity divided by the number of shares with dividend rights.

4 EBITA margin % is EBITA divided by net sales x 100.

6 EBITDA is 'Earnings Before Interest, Taxes, Depreciation and Amortization and Impairment of intangible fixed assets' here including acquisition and divestment results for the full year 2011 and 7 Interest cover is EBITDA as defined in note 6 divided by net interest income and charges. 5 ROCE % is EBITA for the year divided by the average capital employed x 100. The goodwill included in capital employed relates to management goodwill, being the goodwill capitalized and the goodwill charged directly to equity since 1978, the year when CSM started its diversification

3. Consolidated income statement

millions of euros	2011	2010
Net sales	3,112.6	2,990.1
Costs of raw materials and consumables	-1,851.3	-1,703.1
Production costs	-427.5	-421.8
Warehousing and distribution costs	-245.5	-226.7
Gross profit	588.3	638.5
Selling expenses	-248.6	-246.8
Research & development costs	-43.4	-44.9
General and administrative expenses	-196.8	-193.1
Impairment of goodwill	-249.0
Other proceeds		4.4
Operating result	-149.5	158.1
Financial income	2.0	10.2
Financial charges	-31.7	-37.8
Results from joint ventures and associates	-0.1
Result before taxes	-179.3	130.5
Taxes	5.0	-31.2
Result after taxes	-174.3	99.3
Per common share in euros
Earnings	-2.64	1.41
Diluted earnings	-2.64	1.40

4. Consolidated income statement before one-off costs

	2011				2010
millions of euros	Before one off costs	One-off costs	Total	Before one off costs	One-off costs	Total
Net sales	3,112.6		3,112.6	2,990.1		2,990.1
Costs of raw materials and consumables	-1,851.3		-1,851.3	-1,700.2	-2.9	-1,703.1
Production costs	-423.8	-3.7	-427.5	-415.5	-6.3	-421.8
Warehousing and distribution costs	-245.5		-245.5	-226.7		-226.7
Gross profit	592.0	-3.7	588.3	647.7	-9.2	638.5
Selling expenses	-247.1	-1.5	-248.6	-246.8		-246.8
Research & development costs	-43.2	-0.2	-43.4	-44.9		-44.9
General and administrative expenses	-181.6	-15.2	-196.8	-180.9	-12.2	-193.1
Impairment of goodwill		-249.0	-249.0
Other proceeds				4.4		4.4
Operating result	120.1	-269.6	-149.5	179.5	-21.4	158.1
Financial income	2.0		2.0	10.2		10.2
Financial charges	-31.7		-31.7	-37.8		-37.8
Results from joint ventures and associates	-0.1		-0.1
Result before taxes	90.3	-269.6	-179.3	151.9	-21.4	130.5
Taxes	-27.5	32.5	5.0	-39.5	8.3	-31.2
Result after taxes	62.8	-237.1	-174.3	112.4	-13.1	99.3

One-off costs items may occur up to and including the "Operating result" item. The one-off item "Taxes" relates to taxes on these one-off costs only. It does not include incidental tax gains and losses.

One-off costs are considered whenever the operating performance is damaged by an incidental cause outside the normal course of business.

5. Consolidated statement of financial position

before profit appropriation, millions of euros	As at 31-12-2011	As at 31-12-2010
Assets
Property, plant & equipment	583.0	574.6
Intangible fixed assets	912.4	1,146.8
Loans, receivables and other	9.9	9.2
Joint ventures and associates	9.1	1.3
Deferred tax assets	44.5	59.2
Total non-current assets	1,558.9	1,791.1
		335.4
Inventories Receivables	337.9 376.5	366.0
Tax assets	26.0	16.1
Cash and cash equivalents	116.0	118.7
Total current assets	856.4	836.2
Total assets	2,415.3	2,627.3
Equity and liabilities
Equity	948.3	1,117.2
Provisions	89.4	97.4
Deferred tax liabilities	144.0	154.5
Non-current liabilities	726.9	745.7
Total non-current liabilities	960.3	997.6
Interest-bearing current liabilities	4.7	4.0
Trade payables	311.9	296.7
Other non-interest-bearing current liabilities	144.6	154.0
Provisions	23.5	25.4
Tax liabilities	22.0	32.4
Total current liabilities	506.7	512.5
Total equity and liabilities	2,415.3	2,627.3

6. Consolidated statement of changes in equity

	Share	Share premium	Other	Retained
before profit appropriation, millions of euros	capital	reserve	reserves	earnings	Total
As at 1 January 2010	16.9	74.8	-49.6	955.7	997.8
Result after taxes 2010 Other comprehensive result after tax 2010			55.3	99.3	99.3 55.3
Transfers to/from Other reserves			21.3	-21.3
Total comprehensive result after tax 2010			76.6	78.0	154.6
Cash dividend Stock dividend	0.3	-0.3		-36.2	-36.2
Share-Based remuneration transfers			-0.6	0.6
Share-Based remuneration charged to result			1.0		1.0
Total transactions with shareholders	0.3	-0.3	0.4	-35.6	-35.2
As at 31 December 2010	17.2	74.5	27.4	998.1	1,117.2
Result after taxes 2011				-174.3	-174.3
Other comprehensive result after tax 2011 Transfers to/from Other reserves			27.7 -1.1	1.1	27.7
Total comprehensive result after tax 2011			26.6	-173.2	-146.6
Cash dividend				-23.2	-23.2
Stock dividend	0.4	-0.4
Share-Based remuneration transfers			-1.0	1.0
Share-Based remuneration charged to result			0.9		0.9
Total transactions with shareholders	0.4	-0.4	-0.1	-22.2	-22.3
As at 31 December 2011	17.6	74.1	53.9	802.7	948.3

7. Consolidated statement of cash flow

millions of euros	2011	2010
Cash flow from operating activities
Result after taxes	-174.3	99.3
Adjusted for:
- Depreciation/amortization of fixed assets	102.7	107.3
- Impairment of fixed assets	252.1	4.8
- Result from divestments of fixed assets		-4.2
- Result from sale of group companies and activities		-4.4
- Share-based remuneration	0.9	1.0
- Interest income	-1.2	-0.7
- Interest expense	30.4	31.7
- Exchange rate differences	0.9	-0.6
- Fluctuations in fair value of derivatives	-0.6	-5.1
- Other financial income and charges	0.2	2.3
- Results from joint ventures and associates	0.1
- Taxes	-5.0	31.2
Cash flow from operating activities before movements in
working capital	206.2	262.6
Movement in provisions	-10.4	5.8
Movements in working capital:
- Receivables	-0.2	-20.4
- Inventories	3.3	-37.3
- Non-interest-bearing current liabilities	-1.9	44.4
Cash flow from business operations	197.0	255.1
Interest received	1.3	0.7
Interest paid	-30.7	-33.1
Tax paid on profit	-19.6	-34.1
Cash flow from operating activities	148.0	188.6
Cash flow from investment activities
Acquisition of group companies	-12.6	-384.7
Investment joint ventures and associates	-7.9	-0.5
Investment other financial assets	-0.9
Repayment other financial assets	11.7
Capital expenditure on (in)tangible fixed assets	-95.2	-74.0
Divestment of (in)tangible fixed assets	2.0	4.9
Cash flow from investment activities	-102.9	-454.3
Cash flow from financing activities
Proceeds from interest-bearing debts	2.6	595.3
Repayment of interest-bearing debts	-28.8	-302.5
Paid-out dividend	-23.2	-36.2
Cash flow from financing activities	-49.4	256.6
Net cash flow	-4.3	-9.1
Effects of exchange rate differences on cash and cash
equivalents	1.6	7.4
Increase/decrease cash and cash equivalents Cash and cash equivalents at start of financial year	-2.7 118.7	-1.7 120.4
Cash and cash equivalents at close of financial year	116.0	118.7

8. Segment information

	Bakery Supplies		Bakery Supplies
	Europe		North America		Purac		Corporate		CSM Total
millions of euros	2011	2010	2011	2010	2011	2010	2011	2010	2011	2010
P&L information
Net sales	1,077.8	1,022.6	1,627.6	1,567.1	407.2	400.4			3,112.6	2,990.1
EBITA including one-off costs	35.8	61.8	85.1	102.0	41.9	56.6	-32.6	-26.6	130.2	193.8
One-off costs	251.6		9.8	21.4	4.2		4.0		269.6	21.4
Operating result	-216.9	58.9	63.0	73.2	37.3	52.7	-32.9	-26.7	-149.5	158.1
Balance sheet information
Total assets	737.3	963.1	1,062.3	1,056.6	424.6	441.0	191.1	166.6	2,415.3	2,627.3
Total liabilities	310.4	343.2	287.5	282.0	79.1	83.0	790.0	801.9	1,467.0	1,510.1
Capital employed year-end	842.2	786.3	1,018.4	1,009.0	342.2	332.9	37.1	39.4	2,239.9	2,167.6
Average capital employed	832.4	837.6	982.2	971.5	345.4	300.6	51.2	23.5	2,211.2	2,133.2
Depreciation of property, plant & equipment	22.4	22.3	23.9	24.9	25.5	24.4	0.2		72.0	71.6
Amortization of intangible fixed assets	3.7	2.9	22.1	28.8	4.6	3.9	0.3	0.1	30.7	35.7
Other information
Capital expenditure on property, plant & equipment	18.9	14.5	21.0	17.0	38.3	37.9	1.3		79.5	69.4
Capital expenditure on intangible fixed assets	8.7	2.9		0.6	2.0	10.3	1.5		12.2	13.8
Impairment of tangible fixed assets		0.8		6.3	3.1	-2.3			3.1	4.8
Impairment of goodwill	249.0								249.0
Average number of employees	4,231	4,023	4,589	4,409	1,022	971	58	53	9,900	9,456
Alternative non-IFRS performance measures
EBITA margin %	3.3	6.0	5.2	6.5	10.3	14.1			4.2	6.5
ROCE %	4.3	7.4	8.7	10.5	12.1	18.8			5.9	9.1
Alternative non-IFRS performance measures excluding
one-off costs
EBITA	38.4	61.8	94.9	123.4	46.1	56.6	-28.6	-26.6	150.8	215.2
EBITA margin %	3.6	6.0	5.8	7.9	11.3	14.1			4.8	7.2
ROCE %	4.6	7.4	9.7	12.7	13.3	18.8			6.8	10.1

CSM generates almost all of its revenues from the sale of goods.

As non-current assets are not easily available they are not disclosed in the segment overview.

For more information on the impairment of tangible fixed assets see Note 11 and on impairment of goodwill see Note 12.

Information on the Use of Alternative Non-IFRS Performance Measures

In the above table and elsewhere in the Financial Statements a number of non-IFRS performance measures are presented. Management is of the opinion that these so-called alternative performance measures might be useful for the readers of these Financial Statements. CSM management uses these performance measures to make financial, operational and strategic decisions and evaluate performance of the segments. The alternative performance measures can be calculated as follows:

• EBITA is the operating result before amortization and impairment of intangible fixed assets

• EBITA margin is EBITA divided by net sales x 100

• Return on capital employed (ROCE) is EBITA for the year divided by the average capital employed x 100.

Goodwill included in capital employed relates to management goodwill, being the historical cost of goodwill capitalized and the goodwill charged directly to equity. The goodwill charged directly to equity amounts to € 320.7 million.

9. Notes

Accounting principles

The consolidated financial statements of CSM nv have been prepared in accordance with the International Financial Reporting Standards (IFRS) adopted by the European Union. With the exception of financial instruments, the financial statements in general are prepared on the basis of the historical cost principle.

In 2011, CSM applied all the new and amended standards and interpretations published by the International Accounting Standards Board (IASB) and the International Financial Reporting Interpretations Committee (IFRIC), if and insofar as these applied to CSM and were effective as at 1 January 2011.

The main effective change applied by CSM at 1 January 2011 relates to IAS 31:Interests in joint ventures. Anticipating on future IFRS standards concerning joint venture accounting, CSM changed his accounting principle from proportionally consolidation to the IFRS allowed alternative equity method. This has no material impact on CSM's results or equity.

None of the new and amended IFRS and IFRIC interpretations not yet effective in 2011 were applied by CSM. The main effective change after 1 January 2011 relates to a revised IAS 19 Employee benefits. CSM anticipates that IAS 19 revised will be adopted in the Group's consolidated financial statements for the annual period beginning 1 January 2013 and that the application of this revised standard will have an impact on amounts reported in respect of the Group's financial liabilities, results and equity. If the revised standard would have been applies at 1 January 2012, without taken into consideration the corresponding tax effects, equity would have been decreased by approx. € 40 million and the provision would have been increased by the same amount. However, it is not practicable to provide a reasonable estimate on that effect until a detailed review has been completed. CSM anticipates further, that the application of all other new and amended IFRS and IFRIC interpretations yet known in future periods will have no impact on the CSM financial statements.

Related party transactions

On 23 December 2011 the group signed a contract to buy assets for an amount of € 14.5 million from Stichting Pensioenfonds CSM Suiker, a pension fund in which CSM N.V. is the sole sponsor. The legal title of the assets passed after balance sheet date on 2 January 2012. Together with this transaction a disbursed loan of € 6.3 million currently classified within Loans and Receivables was settled after balance sheet date.

Events after balance sheet date

On 23 January 2012 CSM announced that it had acquired the business and other assets of The Cookie Man Limited, in the UK. This acquisition complements CSM's operations in the UK, both in terms of portfolio and customers. The Cookie Man' is a sizeable business focusing on cakes and cookies selling to the main retailers and Out-of-Home customers in the UK with manufacturing operations in Esher, Surrey. The company employs some 340 people. The assets were acquired at a nominal amount in view of the entity's bankruptcy proceedings.