DSM earnings beat expectations as strong demand offsets inflation (updated)
03/05/2022 06:45
(Adds more detail, CEO quote)
AMSTERDAM, May 3 (Reuters) - Dutch specialty chemicals maker
DSM DSMN.AS on Tuesday beat analysts' expectations with a 10%
jump in quarterly core profit to 487 million euros ($511
million), as demand for its food ingredients and materials
stayed strong despite elevated prices.
Revenues also came in higher than expected at 2.59 billion
euros for the first quarter, rising 18% from a year earlier.
"DSM had a good start to the year with robust demand across
our businesses and effective pricing measures to counteract
inflation throughout the value chain," co-CEOs Geraldine
Matchett and Dimitri de Vreeze said in a statement.
Analysts in a company-compiled poll on average had predicted
adjusted earnings before interest, taxes, depreciation and
amortization (EBITDA) would rise to 466 million euros in the
first quarter, on sales of 2.47 billion euros.
DSM in September last year said it was looking to sell its
materials division to focus purely on producing sustainable food
and health products, ranging from food supplements and baby
formula to animal feed. urn:newsml:reuters.com:*:nL1N2QG0BK
In a first move, last month it said it had agreed to sell
its protective materials business to Avient Corp AVNT.N for
$1.48 billion. urn:newsml:reuters.com:*:nL3N2WI13D
Comparable sales at its nutrition and health division
increased 9% in the first quarter, as high inflation spurred
demand for its feed enzymes that improve the efficiency of feed
conversion to proteins in animals.
Sales at the materials division, which now consists only of
engineering goods such as plastics used in electrical
components, cars and food packaging, were up 25%.
The company maintained its outlook for a "mid-single digit"
growth of adjusted EBITDA in 2022, led by the nutritional and
health division, as earnings from materials are seen stabilising
following a strong performance last year.
($1 = 0.9524 euros)
(Reporting by Bart Meijer; Editing by Jacqueline Wong and
Subhranshu Sahu)
((Bart.Meijer@thomsonreuters.com; +31 20 504 5006; Reuters
Messaging: bart.meijer@thomsonreuters.com))