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Q1 2021

Stronger-than-expected start to the year; 3% organic sales growth and strong earnings. 2021 outlook maintained

Organic sales growth of 3% in Q1 2021: Household Care 2%, Food, Beverages & Human Health 11%, Bioenergy -9%, Grain & Tech Processing 16%, Agriculture, Animal Health & Nutrition 0%. EBIT margin at 29.6%. ROIC incl. goodwill at 23.4%. FCF bef. acq. at DKK 0.7 billion.

Ester Baiget, President & CEO: "I am very pleased with the strong start we’ve had in a year where the COVID-19 pandemic continues to create an uncertain environment. Customers have been building stock from supply-chain concerns and the recovery seem faster in emerging markets, but we also recognize a better momentum in the underlying performance of some businesses. While we are off to a good start, we maintain our full-year outlook due to timing factors, supply-chain volatility and continued COVID-19 uncertainty. I am sincerely impressed by the organization’s ability to rapidly adapt to changing conditions and being there to serve our customers.”

In summary:

  • Organic sales grew 3% while sales in reported DKK ended flat from positive M&A impact in line with expectations, and negative currency effects. Organic sales in emerging markets grew 17% and declined 3% in developed markets
  • Household Care benefitted from customer stock building, especially in emerging markets, as well as a recovery in China
  • Performance in Food, Beverages & Human Health and Grain & Tech Processing benefitted from customer stock building, a faster recovery in emerging markets as well as a better underlying momentum
  • Bioenergy remained negatively affected by weak U.S. ethanol demand due to COVID-19 restrictions. Agriculture, Animal Health & Nutrition performed better than expected due to timing of orders with growth in Agriculture offsetting a decline in Animal Health & Nutrition
  • Three product launches including ProAct 360™ in animal nutrition, making poultry production more cost-efficient and sustainable
  • EBIT margin of 29.6%, mainly due to gross margin expansion and despite higher R&D costs, currency headwinds and negative M&A-related effects. One-offs had a net positive effect of roughly 1.5 pp. Free cash flow before acquisitions was solid at DKK 0.7 billion and ROIC including goodwill was strong at 23.4%
  • Strong balance sheet with low gearing (0.9x NIBD/EBITDA). The Microbiome Labs acquisition was closed and the Biota technology asset was purchased. DKK 1.5 billion stock buy back program is ongoing
  • Amy Byrick and Morten Enggaard Rasmussen joined the executive leadership team on April 1 as new EVPs of Strategy & Business Transformation and People, Sustainability & Brand, respectively.


2021 outlook: The improved underlying momentum seen for some businesses in the first quarter does not change the full-year sales outlook due to timing factors, supply-chain volatility and continued COVID-19-related uncertainty. Organic sales are expected to grow by 2% to 6%, with sales in reported DKK ~1 pp lower. One-offs, net, benefit the EBIT margin outlook slightly, supporting the maintained 25% to 26% range. The margin outlook also includes negative y/y impacts from currency, as well as M&A-related effects of around 1 pp each. ROIC incl. goodwill at ~19%. FCF bef. acq. at DKK 2.7-3.1bn.