Symrise Sales Jump 20.7% in FY2022
- Chaileedo Press
- Mar 9, 2023
- 3 min read
Updated: Mar 14, 2023
Symrise forecasts that the Group's CAGR will reach 5% to 7%, higher than the 3% to 4% growth rate of the relevant market.
On March 8, the 2022 financial results of the flavour and fragrance ingredients giant Symrise were released. In the financial year 2022, Symrise sales were €4.618 billion ($4.9 billion), up 20.7% year-on-year and organic growth of 11.4%, significantly stronger than expected. Its net income was €406.1 million ($428.6 million), up 8.3% year-on-year. Its gross profit was €1.7021 million ($1.8 million), up 15.1% year-on-year.
Commenting on the results achieved this year, Symrise said in its earnings report that despite the difficult international political and economic situation, Symrise followed through on its strategy for the financial year 2022.
Meanwhile, the Group was less affected by the disruptions in supply chains and shortages in the procurement markets due to coronavirus pandemic as well as the war in Ukraine.
However, the persistently high level of inflation has in some cases led to significant cost increases for Symrise, which have been largely offset by Symrise's price increase strategy.
Dr. Heinz-Jürgen Bertram, CEO of Symrise AG: "2022 was a very successful fiscal year for Symrise once again. We continued to grow profitably He said "Our outlook for 2023 is correspondingly optimistic. We believe that we will continue to grow and create sustainable value in the current year."
In terms of segment, sales for the Scent&Care segment in fiscal 2022 were €1.706 billion ($1.8 billion), up 14.4% on last year, with strong growth driven by strong demand for Fine Fragrances and cosmetic ingredients. The acquisition of the fragrance and aroma chemicals business of Sensient Technologies and the acquisitions of Néroli and Romani contributed a total of approximately €55 million ($58 million) to the division's sales. EBITDA for Scent & Care was 3.0% higher than the previous year, at €291 million ($307 million) in 2022 (2021: €283 million).
The Scent & Care segment comprises three subdivisions: Fragrances, Cosmetic Ingredients and Aroma Molecules. Specifically, the Fragrances division recorded solid organic growth in the single-digit range. The growth benefited from strong demand in the Fine Fragrances business, which achieved double-digit organic growth, said Symrise. The growth rates were particularly pronounced in Latin America and EMEA.
Sales in the Aroma Molecules division declined slightly, with weaker-than-expected customer demand for fragrances contributing to the organic decline in sales. The menthol business, however, achieved single-digit organic growth, particularly in North America.
The cosmetic ingredients division continued its strong performance and benefited from the strong demand for high-quality cosmetics. All business units and regions contributed to the business development. In particular, strong demand for sun protection products and products containing active cosmetic ingredients led to high organic growth of double-digit percentages.
By region, Symrise's Latin American business recorded €595 million ($628 million), the highest year-on-year growth of 24.7 percent. Its sales in Asia Pacific region were €981 million ($1.035 billion), up 10.4 percent and in Europe-Africa-Middle East was €1.716 billion ($1.8 billion), up 9.4 percent, and North America was €1.326 billion ($1.4 billion), an increase of 8%.
As one of the earliest fragrance giants to enter the Chinese market, Symrise, which entered the market in 1982, has several branches in China and attaches great importance to the Group's development in the region. On January 10, 2023, the group opened the official Symrise China Innovation Lab in Pudong, Shanghai. On March 7, 2023, the opening of the Nantong plant of Symrise Cosmetic Ingredients Division launched.
Achim Daub, Global President of Symrise Daily Fragrances and Cosmetic Ingredients, publicly stated in 2018 that "10 years ago, China was Symrise's fifth largest market (specifically in the fragrance and care segment), and today it has jumped to become Symrise's third largest market in the world."
Following the release of the 2022 financial results, Symrise forecasted the future direction of the Group and reiterated its long-term growth and profitability targets. According to IAL Consulting, the relevant markets are forecast to grow globally by around 3% to 4% in the long term. Symrise forecasts that the Group is confident that it will continue to grow at a faster rate than the relevant markets and will grow by 5% to 7% CAGR in 2023, generating sales of €5.5 billion ($5.8 billion) to €6 billion ($6.3 billion) by the end of 2025.
At the same time, Symrise said in its earnings report that the Group will continue its strategy of price increases to further increase revenues and ensure its profitability by keeping a tight rein on costs. It will focus on higher-margin businesses, and reducing process and workflow complexity. It also will be contributed to developing innovative and sustainable products and technologies.
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