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

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