“Best quarter ever” for DSM Nutrition as Q2 brings €338m profit
New acquisition Martek Biosciences made an “excellent contribution” to a Nutrition division that had “its best quarter ever” contributing €193m of €339m in EBITDA earnings for the quarter – a figure substantially higher than Q2 2010 due to the asset sales. Martek contributed €28m EBITDA on sales of €84m for the quarter.
The Nutrition division’s healthy performance came despite currency fluctuations that cost it €20m-€25m.
Overall sales slid 4.5% due to the loss of elastomers business to be €2.3bn, with Nutrition accounting for €839m of that – up from €764 in Q2 2010, but grew 7% if the sale was removed from the equation.
In a conference call, Feike Sijbesma, DSM CEO and chairman of the Managing Board said the company had €2bn to spend on further acquisitions following its €829m Martek buy and acquisition of the Spanish carotenoid player Vitatene.
He said the company was eying deals of a similar size to the Martek purchase.
"We are well positioned with our balanced, relatively resilient portfolio," he said. "2011 will be a strong year for DSM."
DSM said high raw material prices and currency fluctuations would continue to affect its business for the rest of the year and analysts predicted cost to be passed on to customers in Q3 and Q4.
"They have been able to offset the stronger Swiss franc much better than we anticipated," ABN AMRO analyst Mark van der Geest told Reuters.
"So far, DSM has only been increasing prices for part of its portfolio but the nutrition business has yet to see the benefit of that.”
