Givaudan Raising Prices to Offset Rising Costs in H1 Bear Fruit
- Chaileedo Press
- Oct 12, 2022
- 2 min read
Swiss fragrance and flavor giant Givaudan perfumes and beauty products posted sales of CHF 2.489 billion(about $2.5 billion) in the first three quarters, up 5.9% year-on-year.
On October 11, Swiss fragrance and flavor giant Givaudan announced its results for the first three quarters of 2022. For the first nine months, Givaudan's total sales were CHF 5.458 billion(about $5.489 billion), up 6.1% year-on-year and 7.7% in Swiss francs.
Specifically, Fragrance & Beauty sales in the first three quarters were CHF 2.489 million (about $2.503 million.), up 5.9% year-over-year. Growth in this segment was driven by the continued strong performance of fragrances and flavor ingredients and the continued return of good growth momentum in the consumer products business. In particular, sales of premium fragrances increased 14.8% year-over-year, sales of consumer products increased 2.2% year-over-year, and sales of fragrance ingredients and active beauty increased 10.2% year-over-year.
In the third quarter, sales of fragrance and beauty products were CHF 843 million (about $847.7 million), up 7.1% year-over-year.
By region, Europe Middle East had the highest sales of CHF 2.003 billion (about $2 billion), up 8.1% year-on-year, followed by North America with sales of CHF 1.478 billion (about $1.49 billion), up 6% year-on-year. The Asia Pacific including China, which despite the impact of the restriction of COVID-19 being implemented in China, ranked third in terms of total sales, with CHF 1,337 million (about $1.345 million), up 5.2% year-on-year.
In terms of future expectations, Givaudan says it is targeting 4-5% organic sales growth and at least 12% free cash flow. In terms of longer-term goals, Givaudan is working to double its business by 2030, while achieving environmentally friendly forms of sourcing for all materials and services.
Notably, Givaudan said its business has been on a positive trajectory through the first three quarters of 2022, with its operations and global supply chain both remaining at high levels. At the same time, Givaudan has raised prices across the board for its entire product line to cover rising costs.
On Tuesday, the company said in a statement: "With higher input costs in 2022, the company is fully on track in implementing price increases in collaboration with its customers to fully compensate for the increases in input costs,"
Not only Givaudan, but another head ingredient maker, International Flavors and Fragrances IFF, also made an announcement in March that it would be implementing a broad price increase for all of its divisions. Such as Estee Lauder, Procter & Gamble and other head companies have said that they will increase the prices of their products.
CHAILEEDO saw many consumers on Xiaohongshu reflecting that the prices of perfume products have been increasing in the past year such as Celine, Chanel, Dior, Byredo, Diptyque and so on. And the price increase of these big brand perfumes basically starts at a hundred dollars.
Although the general environmental turmoil has brought about an inflated float in the price market, companies still believe that this is a short-term phenomenon and is manageable. The giants, including Givaudan, are also actively arranging measures to reverse the situation.
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