Divestment finished, Corbion posts EBITDA gain

by Jeff Gelski
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AMSTERDAM, THE NETHERLANDS — Sales volume growth of 5.5% lifted Corbion, the new trade name of CSM n.v., to EBITDA of €29.3 million ($39 million) in the second quarter of fiscal 2013, which compared with €25.3 million in the previous year’s second quarter. Thanks to organic sales growth of 5%, Corbion had second-quarter net sales of €190 million ($253.2 million), which compared with €185.6 million in the previous year’s second quarter.

Excluding one-off costs, EBITDA in the second quarter was €27.2 million, up from €25.6 million. For the year’s first half, Corbion had one-off costs of €2.9 million mainly relating to refocus of the new organization after bakery supplies businesses were divested. Corbion in July said it had completed the divestment of its North American and European Bakery Supplies businesses to Rhone Capital, L.L.C.

“With the divestment of the bakery supplies businesses completed we can now fully focus on the development of our bio-based products activities,” said Gerard Hoetmer, chief executive officer of Amsterdam-based Corbion, when financial results were given Aug. 7.

In the second quarter, the Biochemicals segment had volume growth of 9.3% and the Biobased Food Ingredients segment had volume growth of 4.6%. The second quarter of 2013 had one more business day than the second quarter of 2012, which impacted comparisons slightly.

Within Biobased Food Ingredients, EBITDA excluding one-off costs was €29.8 million in the second quarter, which compared with €28 million in the previous year’s second quarter. Second-quarter net sales of €147.8 million were up from €145.1 million.

For the first half, EBITDA excluding one-off costs was €54 million for Biobased Food Ingredients, which was up from €53.3 million. First-half net sales decreased to €283.2 million from €289.4 million because of weak exchange rates.

The meat market unit made volume gains in the U.S. and European markets.

“For the U.S. meat market, we now see less switching to low- cost-in-use chemical applications,” Corbion said. “At the same time our premium clean label products (Verdad) are gaining momentum.”

Sales performance in the bakery market unit improved in the second quarter. In the first quarter, the bankruptcy of a major account had a negative impact.

Within Biochemicals, EBITDA excluding one-off costs was €4.2 billion in the second quarter, which was up from €4 billion in the previous year’s second quarter. Second-quarter net sales rose to €42.2 million from €40.5 million. Corbion in the second quarter started producing Aloapur, an animal health product that allows poultry farmers to reduce their use of low dosage antibiotics, and engaged in a partnership with Cargill Animal Nutrition.

For the first half of the year, Corbion’s EBITDA was €48.2 million, down from €49.9 million in the same time period of the previous year. Excluding one-off costs, EBITDA in the first half was €50.8 million, up from €50.6 million.

First-half net sales were €370.5 million, down from €376.8 million. Exchange rate effects of €8.3 million impacted net sales negatively in the first half. Net debt at the end of the first half was €567.5 million.

In the second half of the year, a reduction in other G.&A. expenses partially will offset an increase in R.&D. expenses, Corbion said. Financial income and expenses will come down as a result of the proceeds received from the divestment of the bakery supplies activities. Corbion expects capital expenditures for the year to be between €70 million and €80 million. The company plans to return €250 million to shareholders in the second half of the year.

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