DSM reports results first nine months 2018

Heerlen, NL, 31 Oct 2018 07:00 CET

Highlights YTD 2018¹

• DSM reports a very good Q3, contributing to a strong first nine months
• Strong organic sales growth in underlying business at 8%
• Underlying Adjusted EBITDA growth at 7%, despite significant negative FX
• ROCE of underlying business at 13.6%, up 130 bps
• Total temporary vitamin price benefit of €290m on Adjusted EBITDA
• Total Adjusted EBITDA up 34%; Net profit €821m
• Cash from Operating Activities €933m up 51%
• Full year outlook unchanged

Key figures and indicators²

1) Underlying business is defined in this press release as the performance measures sales and Adjusted EBITDA, corrected for DSM’s best estimate of the vitamin effect, which is expected to be temporary.
2) Adjusted EBITDA is an Alternative Performance Measure (APM) that reflects continuing operations.

Feike Sijbesma, CEO/Chairman DSM Managing Board, commented: “We are delighted to report another very good quarter and are confident that we can achieve our full year outlook. The continued organic sales and Adjusted EBITDA growth rates in the underlying business position us well for a strong year which would once again exceed our Strategy 2018 targets.

While there are currently uncertainties around macro-economic developments, we see continued good business conditions in Nutrition and most of our Materials businesses. The strategic plan that we have successfully delivered over the past few years has resulted in a robust portfolio of solution-led, higher value specialty products in Nutrition, Health & Sustainable Living. We are well placed to move forward with our ambitious 2019-2021 strategy. Above market, innovation-led organic growth, as well as inorganic growth will enable us to deliver upon our 2021 strategic targets.”

Q3 Highlights¹

• DSM reports a very good Q3
• Continued good underlying organic sales growth at 5%
• Underlying Adjusted EBITDA growth at 7%, despite the negative FX impact
• Nutrition (underlying business): 7% organic sales growth and 10% Adjusted EBITDA growth
• Materials: 3% organic sales growth and Adjusted EBITDA growth of 3%
• Additional temporary vitamin price benefit of €15m on Adjusted EBITDA
• Total Adjusted EBITDA up 11%

Key figures & indicators²

1) Underlying business is defined in this press release as the performance measures sales and Adjusted EBITDA, corrected for DSM’s best estimate of the vitamin effect, which is expected to be temporary.
2) Adjusted EBITDA is an Alternative Performance Measure (APM) that reflects continuing operations.

DSM confirms its full year outlook 2018 and expects an Adjusted EBITDA growth of approximately 25% and a related higher ROCE growth. This is based on:

• a low double-digit Adjusted EBITDA growth in the underlying business at constant currencies,
• a negative foreign exchange effect on Adjusted EBITDA of about €70 million, and
• a total Adjusted EBITDA benefit for the full year estimated at €290 million from a temporary exceptional vitamin pricing environment

Key figures & indicators¹

1) Including temporary vitamin effect
2) ROCE from underlying business H1 2018 is estimated at 13.8%
3) Over Adjusted taxable result
4) Including result attributed to non-controlling interest
5) Cash, net of customer funding, investment grants and excluding financial leases
6 )Year-end 2017

In this report:
‘Organic sales growth’ is the total impact of volume and price/mix;
‘Total Working Capital’ refers to the total of ‘Operating Working Capital’ and ‘non-Operating Working Capital’

The complete version of this press release with accompanying financial statements and the Presentation to Investors are below in PDF format.

• Press Release & Financial Statements
• Presentation to Investors: First Nine Months 2018 Results
• Media Conference Call: First Nine Months 2018
• Analysts Conference Call: First Nine Months Results 2018