This site uses cookies to store information on your computer. Learn more x

DSM reports H1 2017 results

Heerlen, NL, 01 Aug 2017 07:00 CEST

Highlights

  • Continued good performance in Q2 concludes very strong H1
  • Sales up 11% to €4,320m, with 8% organic growth
  • Adjusted EBITDA up 16% to €721m, driven by both Nutrition and Materials
  • ROCE up 170 bps to 12.2%
  • Net profit up 42% to €312m
  • Interim dividend of €0.58 per ordinary share
  • Outlook 2017: slightly improved

Key figures and indicators

in € million H1 2017 H1 2016 % change
volume price/
mix
FX
other
Sales 4,320 3,907 11% 6% 2% 3% 0%
Nutrition 2,778 2,545 9% 5% 1% 3% 0%
Materials 1,426 1,240 15% 8% 5% 1% 1%
Adjusted EBITDA 721 624 16%        
Nutrition 528 462 14%        
Materials 241 212 14%        
EBITDA 689 603          
ROCE (%)1 12.2% 10.5%          

1) January up until June

CEO statement

Feike Sijbesma, CEO/Chairman of the DSM Managing Board, commented: “DSM maintained its positive momentum with a very strong first half-year performance. The second quarter was another very good quarter.

Halfway through Strategy 2018, we are well ahead of our targets. All businesses are delivering on their growth initiatives, helping us outpace the market; we increasingly provide our customers with innovative solutions, resulting in a continued shift toward specialties. Furthermore, we are fully on track with our wide-ranging cost-reduction and efficiency improvement programs, while anchoring the high-performance culture we strive for. We also continued to make good progress with our sustainability agenda, future-proofing our operations and delivering products and solutions which help our customers to make their businesses more sustainable. The expected Patheon transaction demonstrates our commitment to monetize the significant value within our associates and earlier than anticipated.

While being mindful of the volatile macro-economic environment and the higher-base results achieved since 2015, we are confident for the remainder of the year and have increased our outlook for the full year."

Outlook 2017 slightly improved

DSM now expects to deliver full-year 2017 results above the targets set out in its Strategy 2018, with an EBITDA growth for the year moving slightly up from high single-digit to double digit, and with a ROCE increase moving from double digit basis points to over 100 basis points.

Q2 Highlights

  • DSM reports a very good Q2
  • Sales up 8% to €2,161m, with 6% organic growth
  • Adjusted EBITDA up 15% to €376m
  • Nutrition: 4% organic sales growth; Adjusted EBITDA up 14%
  • Materials: 4% volume growth; Adjusted EBITDA up 9%

Key figures and indicators

in € million Q2 2017 Q2 2016 % change
volume price/
mix
FX
other
Sales 2,161 1,994 8% 4% 2% 2% 0%
Nutrition 1,380 1,295 7% 4% 0% 3% 0%
Materials 725 640 13% 4% 7% 1% 1%
Adjusted EBITDA 376 328 15%        
Nutrition 271 237 14%        
Materials 128 117 9%        
EBITDA 355 332          
ROCE (%)1 12.2% 10.5%          

1) January up until June

Key figures and indicators

in € million H1 2017 H1 2016 % Change Volume Price/mix FX Other
Sales 4,320 3,907 11% 6% 2% 3% 0%
Nutrition 2,778 2,545 9% 5% 1% 3% 0%
Materials 1,426 1,240 15% 8% 5% 1% 1%
Innovation Center 84 83 1% 6% -6% 1% 0%
Corporate Activities 32 39          
in € million Q2 2017 Q2 2016 % Change Volume Price/mix FX Other
Sales 2,161 1,994 8% 4% 2% 2% 0%
Nutrition 1,380 1,295 7% 4% 0% 3% 0%
Materials 725 640 13% 4% 7% 1% 1%
Innovation Center 41 40 3% 9% -7% 1% 0%
Corporate Activities 15 19          
in € million H1 2017 H1 2016 % Change Q2 2017 Q2 2016 % Change
Sales 4,320 3,907 11% 2,161 1,994 8%
Adjusted EBITDA 721 624 16% 376 328 15%
Nutrition 528 462 14% 271 237 14%
Materials 241 212 14% 128 117 9%
Innovation Center 1 1   0 0  
Corporate Activities -49 -51   -23 -26  
Adjusted EBITDA margin 16.7% 16.0%   17.4% 16.4%  
EBITDA 689 603   355 332  
Adjusted EBIT 478 396 21% 256 211 21%
EBIT 441 375   235 215  
Capital Employed 7,692 7,616        
Average Capital Employed   7,831 7,542        
ROCE  (%) 12.2% 10.5%        
Effective tax rate 18.0% 18.5%        
Adjusted net profit 338 244 39% 175 135 30%
Net profit - Total DSM 312 220 42% 163 135 21%
Adjusted net EPS 1.90 1.36 40% 0.98 0.76 29%
Net EPS - Total DSM 1.75 1.22   0.91 0.76  
Cash Flow 329 319 3% 133 182 -27%
Capital Expenditures1 250 177   120 78  
Net debt 2,205 2,466        

1) Cash, net of customer funding

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

Strategy 2018: Driving Profitable Growth

Stepping up DSM’s financial performance

DSM’s Strategy 2018: Driving Profitable Growth is focused on ensuring that the potential of the business portfolio that has been created over recent years is translated into improved financial results. Reflecting its disciplined focus on performance, DSM implemented a three-year strategic period 2016-2018 with two headline financial targets: high single-digit percentage annual Adjusted EBITDA growth and high double-digit basis point annual ROCE growth.

DSM is delivering significantly ahead of schedule at the halfway point of Strategy 2018, having achieved EBITDA growth rates and improvements in return on capital double the original targets set.

DSM has defined clear actions to achieve its targets, including outpacing market growth, cost reduction and efficiency improvement programs and making a continuous push for consistent improvements in capital efficiency.

Outpaced market growth

DSM has outpaced market growth in 2016 and again in H1 2017, growing at rates around double the markets it operates in. DSM continued to leverage its innovation capabilities together with market insights and close customer relationships to accelerate growth for its solutions in its key segments and to develop and open new segments. DSM also took further steps on promising innovation projects for future growth with a wider societal impact, such as Clean Cow, Green Ocean, Stevia and Niaga.

Cost-reduction and improvement programs

DSM has instigated extensive cost-reduction and improvement programs which will deliver €250-300 million in cost savings versus the 2014 baseline. These well-identified programs continue to progress as planned and are on track to deliver the targeted benefits.

Additional actions underpinning Strategy 2018

Besides stepping up the financial performance of DSM’s businesses, Strategy 2018 comprises additional elements aimed at future-proofing the company, providing a strong and sustainable basis for long-term value creation for all its stakeholders.

For DSM, sustainability is a core value as well as an important business driver. DSM’s competences and business plans have a strong link with the Sustainable Development Goals. While DSM’s activities align with many of the SDGs, there are five SDGs on which the company and its businesses can be most influential. In doing so, DSM is focused on delivering science-based, sustainable and scalable solutions that help address challenges the world faces and positively impact the value chain. Not only do these products and solutions (‘Brighter Living Solutions’) offer higher growth rates and better margins, the sustainability aspirations also provide DSM with a focus area to reduce operating costs by increasing its environmental efficiency.

DSM continued to make good progress toward its sustainable operations aspirations in H1 2017:

  • DSM was recently assessed as an ESG (environmental, social and governance) leader within the chemicals industry by Sustainalytics, ranking number 1 out of 130 companies (Assessment as of July 2017, based on 2016 reporting from DSM). This builds further on DSM’s leadership position in reporting benchmarks, having also been named the global leader in the Materials industry group in the Dow Jones Sustainability World Index again in 2016, the seventh time the company has held the number one position.
  • DSM’s drive to improve its environmental efficiency is fully on track, with further improvements in both greenhouse-gas efficiency and energy efficiency in H1 2017.
  • The company now sources about a fifth of its purchased electricity from renewable sources.
  • DSM is also looking to further build on the progress made in 2016 on a number of important social parameters, including employee engagement, which in 2016 was up versus prior year.
  • A safe working environment remains of paramount importance; a relative increase in the number of incidents in the first months of 2017 was a cause for concern and led to remedial actions to boost awareness of and - even more importantly - behavioral adherence to, a ‘safety-above-all-else’ mindset throughout the organization, which will continue into the second half of the year.

DSM is adjusting its global organization and operating model to support the company’s growth and to create a more agile, commercially-focused and cost-efficient business. Actions such as the implementation of new target operating models in ICT, Finance, HR, Indirect Sourcing, Communication and Legal are almost all complete; the emphasis at this stage is above all on ensuring that the new way of working is truly anchored in the organization and in supporting mindset and behaviors.

Talent management and development is a further strategic cornerstone. DSM continued to invest in its talent pipeline to ensure it can sustainably address future challenges and demands, and rolled out a new learning and development module called Lead & Grow, which in the meantime has been followed by almost all executives at the company.

Inclusion & Diversity is an important enabler for a high-performing organization and DSM continues to strive to achieve a balanced and representative workforce. The appointment of Judith Wiese as Executive Vice President People & Organization and member of the Executive Committee is a further step in diversifying DSM’s most senior leadership. DSM’s Executive committee will consist of seven members of whom two are female, with in total five nationalities represented.

DSM ultimately intends to monetize the partnerships that have been established for its former pharma activities (DSM Sinochem Pharmaceuticals and Patheon) and for the former bulk chemical businesses (ChemicaInvest). A first step was taken in July 2016 with the sale of 4.8m shares in Patheon N.V. in connection with its successful IPO. This resulted in a first gain for DSM of €232 million in Q3 2016. In May 2017, the Board of Directors of Patheon unanimously approved the acquisition of Patheon by Thermo Fisher Scientific Inc. for USD 35.00 per ordinary share. DSM has entered into a tender and support agreement with Thermo Fisher pursuant to which DSM will tender its remaining approximately 48.7 million shares in Patheon in the transaction, expected to result in cash proceeds of about USD 1.7 billion.

DSM is building for further growth beyond 2018. DSM continued to make good progress with a number of promising programs in the company’s innovation pipeline. For Nutrition, these include among others the Clean Cow project for reduced methane emissions in cattle, the Green Ocean partnership for more sustainable, nutrient-rich fish-feed, the fermentative stevia sweetener platform, and plant-based proteins for new nutrition applications. Initiatives in Materials include Niaga® Technology for fully-recyclable carpets, ForTii® high-performance plastics and Dyneema® Carbon Composites. DSM expects these and other initiatives to contribute to the company’s Adjusted EBITDA growth in the years beyond 2018.

Review by Cluster

Nutrition

in € million H1 2017 H1 2016 % Change Q2 2017 Q2 2016 % Change
Sales 2,778 2,545 9% 1,380 1,295 7%
Adjusted EBITDA 528 462 14% 271 237 14%
Adjusted EBITDA margin (%) 19.0% 18.2%   19.6% 18.3%  
Adjusted EBIT 383 326 17% 198 165 20%
Capital Employed 5,431 5,391        
Average Capital Employed 5,508 5,317        
ROCE (%) 13.9% 12.3%        
Total Working Capital 1,548 1,470        
Average Total Working Capital as % of Sales 27.6% 27.8%        

Nutrition is well on track toward its aspirations as outlined in Strategy 2018. The businesses continued their strong momentum, delivering above-market growth with an increasingly higher-value portfolio of feed and food solutions. At the same time, productivity, market clout and profitability are being supported by improvement programs, covering cost reduction, operational excellence, and sales. Over the strategy period to date, these growth and profitability initiatives have enabled Animal Nutrition to continue to grow well despite the economic malaise in Latin America, while bringing Human Nutrition back to a solid growth footing.

H1 2017 sales increased by 9% of which 6% organic growth, mainly coming from 5% volume growth at relatively stable prices, up 1%.

H1 2017 Adjusted EBITDA increased by 14% compared to the same period in 2016. Although Nutrition benefited from an easier year-on-year comparison in prices and currencies in the first half-year, the main drivers behind this strong performance were healthy volume growth and the contribution of the improvement programs. The EBITDA margin of Nutrition increased in this first half year to 19.0%, 80 basis points higher than H1 2016, well within the targeted range of 18-20% by the end of 2018.

Q2 2017 sales were 7% up on prior year with 4% organic growth, fully driven by higher volumes.

Q2 2017 Adjusted EBITDA was €271 million, up 14% compared to Q2 2016, driven by solid organic growth, favorable currencies and the execution of the improvement programs. In addition, both Adjusted EBITDA and Adjusted EBITDA margin benefited in Q2 from highly favorable mix effects in Human Nutrition with a relatively high share of high-margin businesses.

Animal Nutrition & Health

Animal Nutrition continued to make good progress with its growth programs, outperforming underlying global growth in animal protein markets. In the first half of 2017, the premix businesses continued to demonstrate healthy growth, as DSM further increased the share of tailored solutions. The emerging need for alternative solutions to enable the ultimate elimination of antibiotics as growth promoters supports growth in higher added-value solutions in for example eubiotics and enzymes.

DSM continues to benefit from its ability to address a wide range of species, as well as from its diversified geographic presence, covering all the major growth areas in the world. Business conditions for animal nutrition remained good across most regions in H1 2017, with the exception of Latin America. The ongoing meat scandal in Brazil further dampened conditions in that region, where business was already pressured by the weak economic backdrop.

DSM continued to make good progress with its sustainable innovations to improve the ecological footprint of animal protein production systems. Among others, the Green Ocean joint operation with Evonik for sustainable omega-3 fatty acids for aquaculture announced in H1 its plan to invest around USD 200 million in a production facility to be located in Blair (Nebraska, USA), expected to come on-stream in 2019.

Q2 2017 volumes were up 2%. Excluding the effect of the ongoing meat scandal in Brazil of around €20 million on Q2 sales, volumes would have been up 5%, in line with DSM’s growth trend in recent years. Prices in Q2 were overall stable when compared to the same period last year. The positive 3% exchange rate effect was driven by the US dollar and Brazilian real, partly offset by the weaker Chinese renminbi.

Human Nutrition & Health

The initiatives undertaken for Human Nutrition over the last couple of years, including reorganizing and refocusing the commercial organization, have given these businesses clear growth momentum, with seven consecutive quarters of good growth including a strong first half 2017 across all regions and market segments.

DSM has been successful in bringing its premix business, which includes the former Fortitech, back to high growth; these tailored solutions allow DSM to diversify its market presence and capture additional value. In H1 2017, Africa Improved Foods Rwanda Ltd, a joint venture between the Government of Rwanda and a consortium including DSM, began production of fortified porridge flour to address malnutrition and stunting.

DSM’s sales initiatives resulted in outgrowing the North American dietary supplements market in both multivitamins as well as in fish-oil based omega-3, including application innovations such as the 3C technology for higher concentrations. The i-Health business continued its double-digit growth, with good initial traction made in the expansion into markets outside the US, as well as in the B2C e-channel business. DSM‘s Culturelle® brand is the number one premium probiotics brand globally. The recently acquired UP4® brand will extend DSM’s offering in probiotics.

Early Life Nutrition continued to perform well, with good growth.

In Q2 2017, Human Nutrition reported a strong 7% volume growth with a highly favorable mix due to strong sales in its premix, i-Health and fish oil-based omega-3.

Prices were slightly down in Q2 with the anticipated lower contractual prices in Early Life Nutrition.

Food Specialties

Food Specialties showed solid organic growth in food enzymes and savory ingredients in H1 2017. Demand for DSM’s market-leading lactase enzyme Maxilact remained buoyant, fueled by the drive to reduce sugar in dairy products.

The Rosalind Franklin Biotechnology Center was officially opened in Delft (NL) in H1. This state-of-the-art facility will accelerate DSM’s biotechnology R&D capabilities for applications in food, feed, fuel and bio-based materials, helping enable the transition from a fossil- to a bio-renewable based economy.

Hydrocolloids started the year soft, but showed a healthy improvement in the second quarter.

Currently DSM has a dispute with one of its partners in Andre Pectin (Hydrocolloids) regarding the execution of its called-upon option to purchase the remainder of the shares held by these parties.

Materials

in € million H1 2017 H1 2016 % Change Q2 2017 Q2 2016 % Change
Sales 1,426 1,240 15% 725 640 13%
Adjusted EBITDA 241 212 14% 128 117 9%
Adjusted EBITDA margin (%) 16.9% 17.1%   17.7% 18.3%  
Adjusted EBIT 177 148 20% 96 86 12%
Capital Employed 1,807 1,775        
Average Capital Employed 1,815 1,751        
ROCE (%) 19.5% 16.9%        
Total Working Capital 353 312        
Average Total Working Capital as % of Sales 12.2% 12.2%        

Materials continued to make solid progress in executing its strategy in H1 2017. The differentiated approach focusing on specialties has provided a clear strategic framework to outpace market growth. Growth is driven by demand for innovative lightweight, environmentally friendlier, safer, and high-performing solutions.

Strong growth in specialties was the main driver behind the 13% organic growth in H1, with all businesses delivering a double-digit increase. H1 2017 volume growth of 8% was clearly above market, benefiting in part from some stocking effects in Q1. The 5% price effect in H1 2017 reflects the increased input costs.

  • DSM Engineering Plastics showed strong sales growth in its high-performance specialty plastics. The business saw good demand in automotive in Europe and Asia, while automotive in the US showed some signs of weakening in the second quarter. Demand in electrical & electronics was good. In this segment, DSM has been particularly successful with the new ForTii® Ace high performance plastic. This product is uniquely suited to address future needs in connected car and mobility applications as well personal smart devices.
  • DSM Resins & Functional Materials continued to benefit from above-average market growth driven by its increasingly specialty, sustainable product portfolio. Coating Resins also benefited from improved demand for powder and waterborne coating solutions in the European building and construction markets. Demand in China for waterborne solutions for maritime container coatings continued to develop strongly. There was also strong demand for fiber-optic materials, where DSM further improved its position. DSM’s unique technological position and global reach in the fiber optic material market is one of the drivers behind its above-market growth.
  • DSM Dyneema saw an increased demand in H1 2017 from the markets for materials for personal protection, both for law enforcement and civilian use. DSM’s protective ballistic, anti-stab or multi-threat materials provide the highest personal protection. The commercial marine markets, which have been soft in recent years, showed a promising recovery in H1 2017, with increased demand for ultra-strong fishing nets for sustainable aquaculture.

H1 2017 sales increased by 15%, with 8% volume growth.

H1 2017 Adjusted EBITDA increased by 14% compared with H1 2016, on the back of higher volumes as well as a continued drive for cost savings and efficiency improvements. Currencies had a small positive impact. The Adjusted EBITDA margin in H1 2017 was 16.9%, versus 17.1% in H1 2016, when DSM still fully benefited from lower input costs.

Regarding Q2 2017, sales were 13% higher than Q2 2016, with 11% organic growth including 4% higher volumes.

Q2 2017 Adjusted EBITDA was €128 million, up 9% compared to Q2 2016. The Adjusted EBITDA margin in Q2 2017 was 17.7%, reflecting price increases implemented to offset the higher input costs. This robust performance underlines the structural improvements achieved in the quality of returns in the Materials businesses over recent years.

Innovation Center

in € million H1 2017 H1 2016 % Change Q2 2017 Q2 2016 % Change
Sales 84 83 1% 41 40 3%
Adjusted EBITDA 1 1   0 0  
Adjusted EBIT -12 -10   -7 -5  
Capital Employed 592 559        

The Innovation Center ensures that DSM always has a robust innovation and growth pipeline. It also serves as a center of excellence to accelerate the innovation power of DSM’s core businesses. Furthermore, it is responsible for developing DSM’s Emerging Business Areas, bringing long-term sustainable growth platforms in promising end-markets. DSM is progressing with its innovation activities, forming the basis for growth the coming years.

DSM Biomedical reported stable H1 sales when compared to the same period last year. The comparison is however impacted by the discontinuation of a large contract. Excluding this impact, business developed well in the first half of the year.

DSM Advanced Solar continued to show good growth. In H1 2017, DSM acquired Suzhou Sunshine New Materials Technology, active in high performance solar photovoltaic back sheets. This technology acquisition supports DSM in its commercialization of a portfolio of innovations focused on lowering the cost of solar energy by providing solid, durable and sustainable materials solutions.

In Q2 2017, higher sales volumes in Biomedical and Advanced Solar were offset by a less favorable price/mix, related to the above-mentioned discontinuation of a contract in Biomedical.

Corporate Activities

in € million H1 2017 H1 2016 Q2 2017
Q2 2016
Sales 32 39 15 19
Adjusted EBITDA -49 -51 -23 -26
Adjusted EBIT -70 -68 -31 -35

H1 Adjusted EBITDA slightly improved compared to H1 2016, as a result of the progress in cost savings being implemented.

Joint Ventures and Associates

Financial overview of DSM’s key joint ventures and associates

in € million H1 2017 H1 2016 % change Q2 2017 Q2 2016 % change
DSM Sinochem            
Sales 217 226 -4% 107 114 -6%
Adjusted EBITDA% 15% 15%   14% 14%  
ChemicaInvest            
Sales
996 892 12% 461 437 5%
Adjusted EBITDA% 8% 2%   7% 0%  
  • DSM Sinochem Pharmaceuticals (50% DSM) showed slightly lower sales with stable margins.
  • ChemicaInvest (35% DSM) showed improved results with top-line growth and higher margins driven by better market conditions and a lower cost base.

Net result contribution of joint ventures / associates

in € million H1 2017 H1 2016 Q2 2017 Q2 2016
DSM Sinochem (50%) 4 4 1 1
Patheon1 (33.5%) 9 -21 2 -9
ChemicaInvest (35%) 0 -10 0 -7
Other -14 -9 -10 -4
Total share of the profit of associates / joint ventures
-1 -36 -7 -19

1) In H1 2016 DSM’s share in Patheon was 49%.

As of 15 May, DSM announced that it entered into an agreement regarding the sale of its 48.7 million ordinary shares in Patheon N.V. to Thermo Fisher Scientific Inc. for USD 35.00 per share. This will result in proceeds of USD 1.7 billion for DSM. The transaction is expected to be completed by the end of 2017 and is subject to the satisfaction of customary closing conditions. Patheon’s net result contribution in Q2 includes the period 1 February 2017 until 15 May 2017, which is the date of the tender offer. Per the same date, Patheon was classified as an asset held for sale. This expected monetization is earlier than anticipated in our Strategy 2018.

The H1 2017 result of ‘Other associates / joint ventures’ included -€12 million (-€11 million in H1 2016) net result of POET-DSM Advanced Biofuels. The Q2 2017 net result of POET-DSM amounted to -€6 million, which was the same as in Q2 2016. POET-DSM successfully implemented a number of process improvements in H1 2017, addressing the pre-treatment issues and focusing on bringing the plant to continuous production of advanced bio-ethanol and improvement in monthly yields. Based on breakthroughs achieved by DSM in the performance of its enzymes, POET-DSM decided to manufacture the enzymes used in the process on-site.

Cash Flow, Capital Expenditures and Financing

in € million H1 2017 H1 2016 Q2 2017 Q2 2016
Cash from Operating Activities 329 319 133 182
Total Working Capital 1,591 1,481    
Total Working Capital as % of Sales
18.4% 18.6%    
Capital Expenditure (cash, net of customer funding) 250 177 120 78
Net Debt 2,205 2,466    

Cash flow from operating activities amounted to €329 million in H1 2017, which was slightly higher than H1 2016.

Total Working Capital amounted to €1,591 million at the end of Q2 2017 compared to €1,481 million at the end of Q2 2016. The higher working capital reflected the higher level of sales (18.4% as a percentage of annualized Q2 sales, which was somewhat below Q2 2016).

Net debt amounted to €2,205 million compared to €2,466m end of June 2016. The decrease of €261 million was mainly due to the proceeds from the secondary offering of Patheon in total of €219 million in Q3 2016.

Interim dividend

DSM will pay an interim dividend of €0.58 per ordinary share for 2017. As usual, this represents one third of the total dividend paid for the previous year. The interim dividend should not be taken as an indication of the total dividend for the year 2017. The interim dividend will be payable in cash or in the form of ordinary shares at the option of the shareholder, with a maximum of 40% of the total dividend amount available for stock dividend. If more than 40% of the total dividend is requested by the shareholders to be paid out in shares, those shareholders who have chosen to receive their dividend in shares will receive their stock dividend on a pro rata basis, the remainder being paid out in cash. Dividend in cash will be paid after deduction of 15% Dutch dividend withholding tax. The ex-dividend date is 3 August 2017. The interim dividend will be payable as from 24 August 2017.

Overview of Alternative Performance Measures (APM) adjustments to EBIT(DA)

The following overview gives a summary of APM adjustments.

APMs H1 2017:

  • Nutrition: EBITDA adjustments amounted to -€9 million relating to the profit improvement programs. EBIT adjustments amounted to -€13 million including -€4 million asset impairment.
  • Materials: EBITDA adjustments amounted to +€1 million (EBIT+€1 million) relating to the release of a litigation provision.
  • Innovation: EBITDA adjustments amounted to +€1 million (EBIT+€1 million) relating to the release of a restructuring provision.
  • Corporate Activities: EBITDA adjustments amounted to -€25 million of which -€18m related to restructuring programs and -€7 million related to the spin-off of some research activities.
  • EBIT adjustments amounted to -€26 million including -€1 million asset impairment.

APMs Q2 2017:

  • Nutrition: EBITDA adjustments amounted to -€4 million (EBIT -€4 million) relating to the profit improvement programs.
  • Corporate Activities: EBITDA adjustments amounted to -€17 million (EBIT -€17 million) of which -€10 million related to restructuring programs and -€7 million related to the spin-off of some research activities.

Dividends and equity

On 26 May 2017, the final dividend of €1.20 per share for the year 2016 was paid to holders of ordinary shares and a dividend of €0.14 per share was paid to holders of cumulative preference shares A. The total distribution to shareholders amounting to €216 million was recorded against retained earnings. An interim dividend for 2017 of €0.58 per ordinary share and €0.06 for cumulative preference shares A was recognized as a liability in the second quarter of 2017. This distribution to shareholders amounting to €104 million will take place in Q3 2017.

In the first half of 2017, 2.5 million shares were released into circulation in connection with stock dividend, the exercise of options and delivery of performance shares. 2.5 million shares were repurchased in the same period.

Statement of the Managing Board

The half-yearly financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of DSM and its consolidated companies; and the half-yearly report gives a true and fair view of DSM’s position as at the balance sheet date, the development during the period of DSM and its group companies included in the half-yearly financial statements, together with the expected developments.