DSM revises profit forecast upwards

Related tags Dsm nutritional products Stock market United states dollar Chemical industry

DSM, the world's leading producer of vitamins, said yesterday that
operating profits in the first quarter would be significantly
better than previously forecast, at 40 per cent higher than in last
year's same period.

The company had previously predicted a 20 per cent growth in operating profits from €131 million in the first quarter of 2004.

Chairman Peter Elverding told yesterday's annual general meeting that the trading update reflected stronger than expected market conditions in Performance Materials and Industrial Chemicals and a continued good performance of DSM Nutritional Products, despite the ongoing impact from the weak dollar and high raw material prices.

It declined to reveal how much of the quarter's profit has come from higher volumes and how much is down to last year's job cuts and restructuring.

Médard Schoenmaeckers, spokesperson for the company, told NutraIngredients.com that the strong performance is "a mixture of restructuring coming on very well - and producing results somewhat sooner than expected - as well as new product innovations picking up well".

New products from the Nutritional Products unit include a new feed enzyme and the green tea compound Teavigo, which is set to be included in new applications.

In February the company reported operating profits for the full-year 2004 66 per cent higher than the previous year, on the back of a 28 per cent sales growth to €7.75 billion. Some two-thirds of the sales growth was a result of the Nutritional Products business.

At the time, Elverding told reporters that the company would consider a share buyback at the end of the year.

DSM​ shares closed yesterday up 5.2 per cent at €58.55.

The company will publish its first quarter results on 27 April.

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