Flavours and ingredients firm Frutarom has reported soaring Q2 profits as net income climbed by more than 44% over the same period last year.
The Israeli company reported record-breaking growth in results on the back of continued profitable organic growth in each of all business units coupled with heavy expansion of operations in the United States and emerging markets that offer higher growth rates.
Reporting its second quarter results today, the firm said that net income climbed by 44.5% to €19.2 million ($25.5m) - from €13.2m million last year, while earnings before interest, tax, depreciation and amortization (EBITDA) increased 33.5% to €32.66 million or 19.9% of sales.
Indeed, gross profit from the first half of 2014 rose by almost a quarter compared to first half profits from 2013 (€115m vs €92.4m) in the company’s core business of Flavours and Specialty Fine Ingredients.
“Our record breaking results in the second quarter and first half of 2014 reflect continued success in implementing our rapid and profitable growth strategy – a combination of profitable internal growth at a higher rate than the growth rates for markets in which we operate and of acquisitions,” said Ori Yehudai, President and CEO of Frutarom.
“The contribution from these acquisitions, the improvement in the product mix, and steps we are taking to optimize our resources have propelled Frutarom towards achieving another quantum leap in its competitive standing as a leading global player,” he said.
Flavours led the way for Frotarom, with the firm’s activities in the flavours sector showing a strong growth and remaining the most profitable of its activities. Second quarter sales were increased by 25.3%, to reach an all-time high of €117.9m (US$156.7m) and represented 71.9% of total sales, while sales for the first half of 2014 also witnessed a 23.4% increase over the same period last year, to reach €218.95m (making up 71.5% of total sales in H1).
The Israeli firm also saw double-digit growth in its Specialty Fine Ingredients sector – which grew by 13.1% in Q2, and 11.2% for the total of H1 (€62.8m in H1 2014 compared with €56.5m in 2013).
"The merging of the eight operations we acquired in 2011 and 2012 was a success and, just as planned, they contributed and will continue to contribute to both growing sales and improved profits and margins,” said Yehudai. “Our integration of the five acquisitions carried out at the end of 2013 and the beginning of 2014 is proceeding on target and these are already contributing and will keep contributing to continued growth in Frutarom's sales and profits this year as well as in the coming years.”