Press release
DSM reports Q1 2018 results
Heerlen, NL, 08 May 2018 07:00 CEST
Highlights1
- Continued strong organic sales growth in underlying business estimated at 11%
- Adjusted EBITDA growth of underlying business estimated at 8%, despite significant FX headwind
- ROCE of underlying business estimated at 13.3%, up 200 bps
- Additional temporary vitamin price benefit estimated at €165m on Adjusted EBITDA
- Total Adjusted EBITDA up 56% and Net profit up 122% to €331m
- Cash from operating activities up 58%, amounting to €310m
- Increased full year outlook confirmed
Key figures and indicators1
| in € million | Q1 2018 | Q1 2017 | % change | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Underlying business2 | Temporary vitamin effect2 | Total Group | Reported | Underlying organic growth2 | FX & ‘other’2 | Underlying total growth2 | Temporary vitamin effect2 | Total Group | |
| Sales | 2,215 | 220 | 2,435 | 2,159 | 11% | -8% | 3% | 10% | 13% |
| Nutrition | 1,430 | 220 | 1,650 | 1,398 | 12% | -10% | 2% | 16% | 18% |
| Materials | 738 | 738 | 701 | 11% | -6% | 5% | 5% | ||
| Adjusted EBITDA | 373 | 165 | 538 | 345 | 8% | 48% | 56% | ||
| Nutrition | 277 | 165 | 442 | 257 | 8% | 64% | 72% | ||
| Materials | 126 | 126 | 113 | 12% | 12% | ||||
| Innovation | -1 | -1 | 1 | ||||||
| Corporate | -29 | -29 | -26 | ||||||
| Adjusted EBITDA margin | 16.8% | 22.1% | 16.0% | ||||||
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.
CEO statement
Feike Sijbesma, CEO/Chairman DSM Managing Board, commented: “We are very pleased that the strong underlying performance of our business continues, with growth well above market. In addition, we are currently benefitting from substantially higher prices in some vitamins due to exceptional supply disruptions in the industry, which are expected to be temporary and heavily weighted towards the first half of the year. These two combined resulted in a significantly higher outlook for the full year 2018, which we announced with our preliminary Q1 2018 results on 12 April 2018.”
Outlook 2018
DSM confirms its increased full year outlook 2018, as announced on 12 April 2018, and expects an Adjusted EBITDA growth towards 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 €80 million, and
- an additional Adjusted EBITDA benefit estimated at €250 – 300 million from an exceptional vitamin pricing environment, that is expected to be temporary and heavily weighted towards the first half of the year
Key figures & indicators1
| in € million | Q1 2018 | Q1 2017 | % change | Volume | Price /mix | FX | Other |
|---|---|---|---|---|---|---|---|
| Sales | 2,435 | 2,159 | 13% | 8% | 13% | -9% | 1% |
| Nutrition | 1,650 | 1,398 | 18% | 9% | 19% | -11% | 1% |
| Materials | 738 | 701 | 5% | 7% | 4% | -6% | 0% |
| Innovation Center | 36 | 43 | |||||
| Corporate Activities | 11 | 17 |
| in € million | YTD 2018 | YTD 2017 | % change | Q1 2018 | Q1 2017 | % change |
|---|---|---|---|---|---|---|
| Sales | 2,435 | 2,159 | 13% | 2,435 | 2,159 | 13% |
| Adjusted EBITDA | 538 | 345 | 56% | 538 | 345 | 56% |
| Nutrition | 442 | 257 | 72% | 442 | 257 | 72% |
| Materials | 126 | 113 | 12% | 126 | 113 | 12% |
| Innovation Center | -1 | 1 | -1 | 1 | ||
| Corporate Activities | -29 | -26 | -29 | -26 | ||
| Adjusted EBITDA margin | 22.1% | 16.0% | 22.1% | 16.0% | ||
| EBITDA | 526 | 334 | 526 | 334 | ||
| Adjusted EBIT | 423 | 222 | 91% | 423 | 222 | 91% |
| EBIT | 411 | 206 | 411 | 206 | ||
| Capital Employed | 7,741 | 7,914 | ||||
| Average Capital Employed | 7,753 | 7,901 | ||||
| ROCE2 (%) | 21.8% | 11.3% | ||||
| Effective tax rate3 | 18.0% | 18.0% | ||||
| Adjusted net profit4 | 337 | 163 | 107% | 337 | 163 | 107% |
| Net profit - Total DSM4 | 331 | 149 | 122% | 331 | 149 | 122% |
| Adjusted net EPS | 1.91 | 0.92 | 108% | 1.91 | 0.92 | 108% |
| Net EPS - Total DSM | 1.88 | 0.84 | 1.88 | 0.84 | ||
| Operating Cash Flow | 310 | 196 | 58% | 310 | 196 | 58% |
| Capital Expenditures5 | 170 | 130 | 170 | 130 | ||
| Net debt | 579 | 2,081 | ||||
| Average number of ordinary shares | 174.8 | 175.1 | 174.8 | 175.1 | ||
| Workforce (headcount end of period) | 20,870 | 21,0546 |
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.
For more information
Lieke de Jong-Tops
Senior Communications Manager
+31 45 578 2420
media.contacts@dsm.com
Dave Huizing
Vice President Investor Relations
+31 45 578 2864
investor.relations@dsm.com
Lieke de Jong-Tops
Senior Communications Manager
+31 45 578 2420
Dave Huizing
Vice-President Investor Relations
+31 45 578 2864