Here we
go.
Good
afternoon
or
good
morning,
ladies
and
gentlemen.
Welcome
to
the
Presentation
of
the
Symrise
2021
Full Year
Results.
With
me
in
this
conference
call are
our
CEO,
Dr.
Heinz-Jürgen
Bertram;
and
our
CFO,
Olaf
Klinger.
The
ongoing
corona
pandemic
has
unfortunately
kept
us
again
from
hosting
this
event
in-person
in
Frankfurt,
but
we
are
happy
to
have
you
in
this
virtual
format
instead.
We
will
go
through
our
results
and
provide
an
outlook
on
the
current
year
from
our
headquarters
here
in
Holzminden.
You
will,
of
course,
also
have
the
opportunity
to
ask
questions
during
the
Q&A
session,
following
the
presentation.
All
documents
have
been
published
on
our
webpage
this
morning
in
the
section,
Investors
at
Financial
Results.
You
can
also
find
the
recording
of
this
session
later
today.
I
will
now
hand
over
to
our
CEO,
Dr.
Heinz-Jürgen
Bertram.
Please
go
ahead.
H
Heinz-Jürgen Bertram
Thank
you,
Tobias.
Good
morning,
ladies
and
gentlemen,
and
welcome
also
from
my
side.
I
am
delighted
that
so
many
of
you
have
taken
the
time
to
join
our
call
today.
I
will
begin
with
the
highlights
of
2021.
Olaf
will
then
provide
a
deep
dive
into
the
financials
before
I
conclude
with
our
key
strategic
initiatives
and
an
outlook
for
the
road
ahead.
Let us
have
a
look
at
chart
4.
The
year
2021
was
clearly
marked
by
a
strong
economic
recovery
from
the
effects
of
the
global
coronavirus
pandemic.
The
improved
situation
led
to
fewer
restrictions.
The
social
life
gained
good
momentum
again.
However,
particularly
since
the
second
half
of
the
year,
the
economy
has
been
facing
persistent
bottlenecks
in
supply
chains.
Rising
inflationary
effects
and
higher
raw
material
prices
intensified
the
pressure
on
economies
worldwide.
As
other
players,
Symrise
was
also
influenced
by
these
factors.
But
we
successfully
capitalized
on
returning
demand
and
continued
our
profitable
growth
course
despite
some
headwinds.
Our
diversified
portfolio
and
our
backward
integration
have
been
decisive
factors
for
success.
We
are,
therefore,
looking
at
an
all-around
very
satisfactory
year
2021.
We
grew
sales
by
around
9%
to
over
€3.8
billion.
Organic
growth
was
even
stronger
at
almost
10%.
EBITDA
increased
by
9.6%
to
€814
million
and
our
profitability
remained
at
a
high
level
of
21.3%.
The
business
free
cash
flow
amounted
to
€486
million
and
equals
about
13%
of
sales.
Net
income
grew
by
more
than
20%
to
€375
million,
which
corresponds
to
€2.74
per
share.
Our
dividend
proposal
amounts
to
€1.02
per
share
for
fiscal
year
2021.
This
proposal
represents,
ladies
and
gentlemen,
the
12th
consecutive
dividend
increase.
Let
me
conclude
the
snapshot
with
one
more
highlight,
our
DAX
membership.
After
14
years
in
the
German
MDAX,
we
have
become
member
of
the
leading
German
index
last
September.
Our
share
gains
even
more
visibility
and
interest
amongst
shareholders
now.
Taking
a
look
at
our
sales
growth
on
chart
5.
Group
sales
increased
to
over
€3.8
billion,
including
€40
million
of
Sensient
Fragrances,
which
we
had
acquired
last
year.
Organically,
the
group
achieved
even
stronger
growth
of
9.6%,
driven
by
both
segments
and
all
regions.
We
not
only
exceeded
our
sales
forecast,
which
we
had
raised
twice
last
year,
but
also
outperformed
market
growth.
In
both
segments,
we
observed
normalization
in
consumer
behavior
and
increased
demand,
which
page
6
illustrates.
Taste,
Nutrition
&
Health,
our
renamed
segment,
which
resulted
from
the
combination
of
our
two
former
Flavor
and
Nutrition
segments,
generated
sales
of
€2.3
billion.
Organic
growth
amounted
to
an
excellent
10.6%.
The
renewed
out-of-home
consumption
boosted
demand,
particularly
for
beverage
applications.
A
strong
growth
driver
was
once
again
our
Pet
Food
business,
which
grew
in
the
double-digit
percentage
range.
Our
Scent
&
Care
segment
also
performed
extremely
well.
Sales
rose
by
8.9%
to
around
€1.5
billion
and
organic
growth
came
to
7.9%,
driven
by
all
application
areas.
Fine
Fragrances
and
Cosmetic
Ingredients
particularly
benefited
from
the
resumption
of
travel.
Coming
to
our
regions
where
we
also
have
a
very
good
news
to
share
on
chart
7.
We
grew
across
all
regions
with
Latin
America
being
the
strongest
one
and
delivering
organic
growth
of
13.5%.
Asia
Pacific
achieved
organic
growth
of
10.3%.
EAME and
North
America
generated
very
good
organic
growth
rates
of
8.8%
and
8.5%,
respectively.
Symrise
is
sustainable
in
more
than
one
respect.
We
stand
for
sustainable
operations
and
sourcing.
We
also
stand
for
a
very
sustainable
financial
performance,
as
you
can
see
on
chart
8.
Since
our
IPO
in
2006,
we
delivered
an
annual
compounded
growth
of
around
8%.
Our
EBITDA
CAGR
amounts
to
an
excellent
8.4%
and
our
profitability
is
on
a
constantly
high
level.
We're
creating
value
every
single
year.
This
makes
us
very
proud.
And
I
would
like
to
thank
all
our employees
worldwide
for
their
tireless
work,
commitment
and
dedication.
As
chart
9
shows,
our
share
price
has
also
performed
very
well
gaining
more
than
20%
in
2021.
We
outperformed
both MDAX and DAX
and
consider
this
a
confirmation
of
our
attractiveness.
But
it
also
reflects
the
trust
investors
have
in
our
strategy
and
long-term
prospects.
It
is
part
of
our
Investor
Relations
philosophy
to
have
our
shareholders
participate
in
Symrise's
success.
The
management
and
supervisory
board
will,
therefore,
propose
a
2021
dividend
of
€1.02
per
share.
This
proposal
represents
the
12th
consecutive
dividend
increase
and
is
another
indicator
for
our
commitment
to
long-term
value
creation.
Let
me
pause
here
and
turn
to
Olaf.
He
will
now
provide
the
details
on
our
financials.
Olaf?
O
Olaf Klinger
Chief Financial Officer, Symrise AG
Yeah,
thank
you
very
much,
Heinz-Jürgen,
and
also
warm
welcome
from
my
side.
Let
me
start
straight away
with
our
sales
development
on
group
level
on
slide
11.
We
achieved
strong
organic
growth
of
9.6%,
which
is
far
above
market
growth.
But
not
only
that,
we
also
outperformed
our
guidance
of
average
annual
organic
sales
growth
between
5%
and
7%.
It
is
particularly
important
to
note
that
sales
growth
was
driven
by
volume,
not
price.
This
will
change
in
the
current
year
towards
substantially
more
contribution
from
price.
Going
through
major
events
this
year,
Q1
was still
characterized
by
the
cyber-attack
that
hit
us
at
the
end
of
2020.
We
recovered
within
weeks
and
caught
up
the
vast
majority
of
the
missed
turnover
quickly.
Special
thanks
go
to
our
clients
and
partners
for
their
support
and
our
Symrise
colleagues
for
their
extra
effort
to
recover
our
IT
system
environment
in
an
accelerated
mode.
Throughout
the
year,
global
consumer
demand
caught
up
immensely.
Travel
activity
and
the
leisure
sector
particularly
benefited,
which
drove
the
need
for
cosmetic
applications
and
beverage
solutions.
Also,
our
Pet
Food
activities
performed
extraordinarily
well,
supported
also
by
ADF/IDF,
which
we
acquired
back
in
2019,
and
which
continues
to
perform
well
ahead
of
our
initial
expectations.
The
performance
of
the
Sensient
Fragrance
acquisition
was
fully
in
line
with
our
initial
expectations.
The
business
contributed
sales
of
€41
million
and
in
addition
to
acting
as
internal
raw
material
supplier.
In
terms
of
FX,
we
had
negative
effects
of
€73
million
for
the
full
year,
but
positive
sales
impact
on
€20
million – of
€23
million
in
Q4.
For
2022,
we
expect
FX
tailwind
that
will
support
our
reported
top
line
as
well
as
our
group
sales
target
of
€4
billion
to
€4.5
billion,
which
we
gave
in
2019
for
the
year
2022.
We
are
fully
on
track
to
deliver
on
our
mid-term
ambitions.
On
to
our
profitability
on
slide
12.
Gross
margin
amounted
to
38.7%
compared
to
39.5%
in
2020.
The
development
is
linked
to
higher
manufacturing
costs
and
increased
raw
material
expenses
with
an
inflation
of
about
1.2%
last
year.
Our
P&L
has
been
impacted
by
a
few
extraordinary
items.
We
experienced
M&A-related
transaction
cost
of
€8.7
million,
positive
one-off
items
came
from
the
sale
of
the
color
business
with
plus
€12.5
million
and
from
the
favorable
book
value
of
the
Sensient
Fragrance
acquisition
with
plus
€20.8
million.
Please
keep
in
mind
that
the
substantial
benefit
from
the
book
value
is
connected
to
an
initially
low
profitability
of
the
acquired
Sensient
Fragrance
business.
EBITDA
grew
by
9.6%,
also
supported
by
lower
travel
and
R&D
costs.
Our
EBITDA
margin
increased
to
21.3%
after
an
already
strong
level
of
21.1%
the
year
before.
While
depreciation
increased
moderately,
amortization
decreased
by
around
€4
million,
mainly
due
to
the
end
of
the
amortization
period
of
IT
software
solutions.
As
a
consequence,
our
EBIT
rose
over
proportionally
by
14.7%
and
our
EBIT
margin
reached
a
solid
level
of
14.6%
compared
to
13.8%
in
2020.
Let
us
now
look
into
the
segments,
starting
with
Taste,
Nutrition
&
Health
on
slide
13.
The
segment
successfully
leveraged
returning
consumer
preferences
and
achieved
an
organic
grow –
sales
growth
of
10.6%.
We
saw
an
exceptional
upturn
in
beverage
solutions,
followed
by
double-digit
growth
in
Pet
Food
activities.
EBITDA
grew
by
12.9%
or
€60
million
to
€531
million. The
segment
increased
its
EBITDA
margin
to
22.7%
and
operated
highly
profitable
despite
higher
costs.
Our
strategy
to
invest
into
faster
growing
and
more
profitable
businesses
starts
to
pay
off.
In
addition,
initial
steps
to
increase
prices
were
successfully
taken.
On to
Scent
&
Care
on
slide
14,
Scent
&
Care
achieved
organic
sales
growth
of
7.9%.
Main
growth
drivers
were
Fine
Fragrances
and
Cosmetic
Ingredients,
which
both
benefited
from
the
normalization
of
consumer
behavior
and
experienced
an
excellent
upswing
after
the
sharp
decline
in
2020.
Aroma
Molecules
was
supported
by
strong
demand
and
further
capacities
for
menthol
built
during
the
recent
years.
Consumer
Fragrances
and
Oral
Care
achieved
single-digit
sales
growth
following
exceptional
high
levels
in
the
prior
year.
EBITDA
in
Scent
&
Care
increased
by
4.1%
or
€11
million
to
€283
million.
The
margin
totaled
19%
compared
to
19.8%
the
year
before.
The
decline
was
mainly
due
to
a
below
average
operational
margin
at
Sensient
Fragrances,
increased
raw
material
costs
and
higher
manufacturing
costs.
During
the
second
half
of
the
year,
Scent
&
Care
experienced
higher
costs
related
to
increased
logistics,
energy
as
well as
packaging
costs.
While
price
increase
initiatives
were
taken
early
on
in
the
second
half
of
last
year,
the
effect
will
mostly
come
in
starting
this
year
due
to
the
nature
of
customer
contacts,
especially
in
Aroma
Molecules
and
Cosmetic
Ingredients.
Turning
now
to
the
financial
result and
bottom
line
on
slide
15.
The
financial
result
improved
by
around
€21
million
and
reflects
generally
lower
financing
costs
in
2021.
In
addition,
we
had
a
one-off
effect
payment
to
tax
authorities
during
the
year
before.
At
the
Capital
Markets
Day
in
January
2019,
I
gave
a
tax
guidance
of
26%
to
28%.
Since
our
tax
rate
developed
well
and
further
decreased
from
25.6%
to
25.4%
last
year,
I
would like
to update
our tax
guidance
to now
25%
to
27%
for
the
coming
years.
Our
bottom
line
grew
by
more
than
20%
to
€375
million.
EPS
reached
a
new
all-time
high
at
€2.74.
It
is
also
to
be
kept
in
mind
that
the
number
of
shares
increased
because
of
the
conversion
of
the
convertible
bond
into
new
shares
in
September
last
year.
Please
take
note
that
the
EPS
is
calculated
based
on
a
weighted
average
number
of
shares
last
year.
As
stated
by
Heinz-Jürgen,
management
and
supervisory
board
will
propose
a
dividend
increase
to
€1.02
per
share.
Let's
continue
with
our
business
free
cash
flow
on
slide
16.
The
level
for
2021
remained
below
the
high
levels
of
the
previous
two
years
despite
strong
EBITDA
growth
for
three
reasons.
First,
2021
was
a
year
of
important
investments.
We
spent
€174
million,
including
some
strategic
growth
initiatives.
Second,
we
increased
working
capital
as
a
result
of
the
cyber-attack
in
late
2020,
as
well as
strategic
inventories
to
maneuver
risk
and
the
global
supply
chain.
And
third,
with
a
higher
level
of
trade
receivables
due
to
the
strong
growth
in
sales.
Despite
the
strong
earnings
growth,
business
free
cash
flow
settled
at
12.7%
of
sales.
For
2022,
we
are
optimistic
to
reach
a
level
of
around
14%
of
sales
again.
Moving
on
to
net
debt
development
on
slide
17.
With
the
increase
in
capital
and
further
reduction
of
debt,
net
debt,
including
pensions
and
leasing
obligations,
totaled
2.4
times
EBITDA
as
of
December
31.
For
2022,
we
expect
a
slightly
higher
leverage
ratio
of
2.5
to
2.7
times,
driven
by
recent
and
further
expected
M&A
activities.
Our
top
priority
still
remains
to
be
an
investment-grade
profile.
Taking
a
closer
look
at
the
balance
sheet
on
slide
18.
Investments
and
acquisitions
increased
property,
plant
and
equipment
as
well as
intangibles.
The
increase
in
other
assets
results
from
the
participation
in
Swedencare.
In
August,
we
decided
to
redeem
our
€400
million
convertible
bond
really
by
conversion
into
new
shares.
Our
equity
increased
by
€890
million
to
€3,252
million.
Next
to
the
conversion
of
the
convertible,
we
benefited
from
positive
FX
translation
differences
of
around
€170
million,
as
well as
an
increase
in
accumulated
profit
and
other
reserves
of
around
€276
million.
Our
equity
ratio,
therefore,
closed
the
year
at a
very
healthy
level
of
49%.
All
in
all,
we
enjoyed
another
successful
year
with
profitable
growth
at
Symrise,
once,
again,
confirming
the
resistance
of
our
business
model
in
challenging
times.
And
after
this
financial
deep
dive,
I
now
hand
back
to
Heinz-Jürgen.
H
Heinz-Jürgen Bertram
Thank
you,
Olaf.
Ladies
and
gentlemen,
let
us
look
at
the
strategic
initiatives.
They
have
supported
our
performance
in
2021
and
which
will
bear
further
fruit
going
forward.
Chart
20
illustrates
our
new
corporate
structure
and
gives
background
to
establish
the
Taste,
Nutrition
&
Health
segment.
We
have
decided
to
bundle
the
Flavor
&
Nutrition
competencies
and
build
a
global
powerhouse
around
Taste,
Nutrition
&
Health,
three
assets
which
are
closely
tied
together.
With
an
expanded
portfolio,
we
are
in
an
even
better
position.
First,
to
serve
the
needs
of
our
customers
with
sustainable
and
innovative
products
and
solutions.
Second,
to
tackle
promising
new
markets.
And
third
to
further
increase
our
competitiveness
through
unique
capabilities.
M&A
have
traditionally
been
important
elements
for
differentiation
and
growth.
Please
have,
therefore,
a
look
at
page
21.
For
example,
Canadian
Giraffe
Foods,
the
company
will
strengthen
our
food
business
via
customized
taste
concept
and
make
us
a
leading
provider
of
integrated
food
solutions
in
North
America.
Pet
Food
is
a
key
driver
for
our
portfolio
and
our
growth,
and
we
even
want
to
expand
our
position
as
the
leading
international
supplier
for
pet
food
solutions.
We
acquired
a
minority
stake
in
Swedencare
and
aim
to
strengthen
our
knowledge
of
veterinary
products
supporting
the
well-being
of
pets.
The
Dutch
company,
Schaffelaarbos
is
an
excellent
example
for
expanding
our
position
in
egg-based
proteins.
As
you
all
know,
APAC
has
traditionally
been
a
highly
promising
region
for
us,
and
with
the
acquisition
of
Chinese
Wing
Pet
Food,
we
just
announced
a
few
days
ago,
we
intend
to
further
increase
our
footprint
in
pet
food
in
the
region.
At
the
same
time,
we
stopped
activities.
The
core
business
no
longer
includes
the
food
color
applications,
which
we
sold
to
Oterra,
as
well
as
the
Drinkstar Velcorin
activities.
In
the
Scent
&
Care
segment
too,
the
wheels
have
not
stood
still,
as
you
can
see
on
chart
22.
We
have
reorganized
our
regional
presence
and
expanded
our
portfolio
through
targeted
acquisitions
and
strategic
partnerships.
I
want
to
highlight
three
here.
With
Sensient,
we
have
strengthened
our
Fragrance
and
Aroma
Molecules
business.
As
part
of
this
acquisition,
we
also
acquired
the
Sensient
site
in
Granada.
It
will
become
an
important
European
hub
for
our
Scent
&
Care
business.
Two
more
important
steps
have
been
realized
with
a
minority
interest
in
US-based
Kobo
Beauty,
Inc.
and
a
cooperation
agreement
with
the
US
startup,
Infinite
Looks.
Both
demonstrate
our
efforts
to
further
expand
our
portfolio
in
attractive
business
and
product
areas,
namely
UV
protection,
decorative
cosmetics
and
hair
care. These
acquisitions
and
divestments
show
our
clear
commitment
to
continuously
improve
our
portfolio
and
make
Symrise
a
unique
player.
Sustainability
is
and
always
has
been
an
integral
part
of
our
strategy.
For
this,
please
see
chart
23.
Our
approach
is
fully
aligned
with
the
UN
sustainability
goals
and
embedded
in
all
our
operations
from
sourcing
thousands
of
raw
materials
from
all
over
the
world
to
the
production
process
to
delivery
to
the
customer.
We
let
ourselves
be
measured
by
a
number
of
KPIs.
And
it
is
our
clear
goal
to
become
climate
positive
by
2030.
Our
commitment
to
climate
protection
is
already
recognized
today.
For
example,
by
the
Carbon
Disclosure
Project,
Symrise
was
awarded
triple A
status
for
the
second
consecutive
year
in
a
row
in
all
three
categories
water,
climate,
as
well
as
forest.
We
are
the
only
company
in
Germany
and
1
of
only
14
worldwide
with
that
status.
Investments
pave
the
way
to
growth
in
the
future.
Chart
24
highlights
some
selected
projects,
which
comprise
investments
into
new
capacities,
as
well
as
R&D.
We
have,
for
example,
built
a
new
site
for
our
Pet
Food
division
in
China
and
set up
a
new
innovation
center
in
Dubai.
On
the
R&D
side,
we
have
put
a
particular
focus
on
innovations.
For
instance,
the
launch
of
SymProBiome,
which
is
a
new
model
for
microbiome-based
research. And
in
the
area
of
advanced
technologies,
we
have
invested
in
a
very
exciting
digital
tool
to
improve
traceability
of
global
farming.
It
allows
us
to
collect
structure
and
coordinate
agronomic
data
from
around
the
world.
I
want
to
conclude
today's
presentation
with
the
outlook
for
this
year,
on
page
25.
Following
the
strong
recovery
in
2021,
experts
estimate
that
the
global
economy
will
grow
more
moderately
this
year.
In
addition,
I
am
sure
this
is
not
a
surprise
to
you.
We
expect
an
increase
in
selective
raw
material
and
energy
prices.
Also,
the
crisis
in
the
Ukraine
and
the
impact
for
all
of
us
cannot
be
foreseen
today.
However,
we
are
confident
that
we
are
very
good
positioned
to
continue
our
profitable
growth
course.
Our
robust
business
model
with
its
diversified
portfolio,
our
far-reaching
international
presence
and
broad
customer
base
give
us
tailwind.
For
2022,
we
are
targeting
organic
growth
of
5%
to
7%
in
line
with
our
mid-term
guidance.
Despite
headwinds
from
raw
material
and
energy
prices,
we
aim
at
an
EBITDA
margin
of
around
21%.
Ladies
and
gentlemen,
thank
you
for
your
attention.
I
would
now like
to
open
the
call
for
your
questions.
Tobias?
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Many
thanks,
Heinz-Jürgen.
And
many
thanks,
Olaf.
Turning
to
Q&A,
we
are
now
happy
to
take
the
questions
from
the
audience.
And
the
first
question
comes
from
Lisa
De
Neve
from
Morgan
Stanley.
Lisa,
please
go
ahead.
L
Lisa H. de Neve
Analyst, Morgan Stanley & Co. International Plc
Hi,
good
afternoon,
and
thank
you
for
taking
my
question.
I
have
two.
So
the
first
one
is
on
the
EBITDA
margin.
You are
guiding
to
about
21%
margin
at
this
point
in
time
of
the
year
for
2022.
So can
you
please
share
just
sort of
building
blocks
that
underpin
that
guidance,
especially
as it
relates
to
raw
material
inflation,
degree
of
pricing,
synergies
you
may
expect?
And
maybe
also
on
the
adjusted
versus
reported
line,
any
sort
of
integration
or
startup
costs
we
should
calculate
or
take
into
account?
That
would
be
super
helpful.
H
Heinz-Jürgen Bertram
So,
Lisa, and
I
start,
and
I
would
say,
Olaf,
you
take
the
mix
of
price
increases
and
volume
and
all
this
stuff.
So
one
point,
which
I
just
stressed
is,
we
have
consequently
improved
and
managed
our
portfolio.
So
assets,
which
were
not
core
business
anymore
or
which
were
dilutive
on
our
margin,
we
sold.
And
we
have
consequently
looked
for
business
areas
with
a
better
business
perspective,
and
if
possible,
even
an
accretive
business
bottom
line
contribution.
Olaf?
O
Olaf Klinger
Chief Financial Officer, Symrise AG
Yeah.
So
from
our
perspective,
the
EBITDA
margin
is
supported
by
price
increases
which
we
started
last
year
quite
a
little
bit.
We
are
seeing
them
coming
in.
So
the
5%
to
7%
growth
guidance
for
this
year will
incorporate a
substantial
amount
of
price
here.
That's
one
driver.
The
second
driver
I
would
highlight
is,
again,
the
strong
development
of
our
portfolio
into
fast
growing,
high
margin
businesses.
I
think
we
have
seen
a
few
acquisitions
in
the
last
few
months,
and
all
of
them
will
be
accretive.
And
therefore,
the
mix
in
this
regard
will
further
improve
our
profile.
So
the
diversification
of
the
group
continues
in
this
regard
and
supports
well
the
margin
expectation.
L
Lisa H. de Neve
Analyst, Morgan Stanley & Co. International Plc
Can
I
just
follow
up a
little
bit
on
the
raw
materials
and
the pricing
specifically?
Can
you just
share
what
you are
seeing
on
the
raw
material
landscape
in
terms
of
the
degree
of
raw
material
inflation
you are
expecting
for
this
year?
And
to
which
extent,
you've
been
able
to
renegotiate
that
via
pricing
on
the
top line?
How
should
we
think
about
pricing
versus
raw
materials
this
year
and
sort of
the
timeline
that's
lapping
that
if
that's
what's
going
to
happen?
Thank
you.
H
Heinz-Jürgen Bertram
So
I
will
start,
Olaf,
and
you
hop
in
if
you
feel
there is
something
more
to
be
added.
As
what
we
said
beginning
of
last
year,
we
expected
for
last
year
1%
to
2%
price
increases.
And
for
last
year,
we
saw
a
bit
more,
say,
than
2%,
but
around
the
guidance
we
gave
at
the
beginning
of
last
year
was
correct,
with
the
caveat
that
most
of
the
price
increases
of
last
year
happened
in
the
last
quarter.
And
so
happened
it
this
year,
we
saw
a
steep
price
increase
in
the
beginning
of
this
year.
We
expect
about
6%
on
top
of
it.
So
that
brings
us
to,
say,
in
total,
8%,
and
we
discussed
it
last
year
already.
We
had
started
in
time
to
pass
on
price
increases
for
the
products.
And
as
per
now,
we
feel
well-equipped
that
we
have
managed
to
pass
on
most
of
our,
if
not
all
of
the
price
increases
to
the
customers.
As
Olaf
has
said,
not
all
of
these
price
increases
which
we
pass
through
have
been
materializing
yet
because
some
of
the
contracts,
in
particular,
in
the
Aroma
Molecules
area,
but
also
in
Flavors
and
Fragrance
are
still
valid.
And –
but
in
the
next
weeks
or
month,
these
price
increases
will
come
through.
So
of
course,
the
situation
is
not
always
clear
and
visible
to
us
how
it
continues
to
develop.
But
as
per
now,
we
feel
confident
that
we
have
been
able
to
pass
on
the
price
increases
or
that
these
price
increases
will
go
through
within
the
next
weeks.
Olaf, if
you
want
to
add
a
bit
more?
O
Olaf Klinger
Chief Financial Officer, Symrise AG
No,
I
think
you
said
it.
And
keep
in
mind,
I
mean,
we
have a
raw
material
base
of
10,000
raw
materials.
So
across
this
portfolio,
you
see,
of
course,
different
elements
coming
through.
And
some
price
increases
have
been
extremely
substantial,
like
in
Aroma
Molecules,
very
substantial
double-digit
numbers
we
needed
to
take.
Similar
in
Pet
Food,
we
had
substantial
price
increases
initiated
last
year.
So
across
the
portfolio, it
will
come
through
in
different
magnitudes.
We
said
in
the
past
three
to
six
months,
it
takes
us
normally
to
[ph]
pass
the
two (32:35).
Maybe
this
year, it
might
be
a
little
bit
longer
because
the
increases
continue,
and
we
need
to
see
how
we
play
this
out.
But
no
worry
at
the
moment
on
our
end
that
we
will
not
be
successful
in
protecting
our
margin
environment.
H
Heinz-Jürgen Bertram
And one
key
message
which
I
would
like
to
highlight
in
addition
to
what
Olaf
said,
we
benefit
from
the
best
backward
integration
in
our
industry.
And
in
times
when
we
have
crisis,
then
we
typically
benefit
from
this.
And
in
this
time,
it
again
shows
the
value
of
our
business
model,
and
that's
why
we
are
confident
for
this
year
as
well.
L
Lisa H. de Neve
Analyst, Morgan Stanley & Co. International Plc
Thank
you
very
much,
guys.
H
Heinz-Jürgen Bertram
You're
welcome.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Well,
thank you
very
much,
Lisa.
Next
question
comes
from
Matthew
Yates
from
Bank
of
America
please.
M
Matthew Yates
Analyst, BofA Securities
Hey.
Good
morning,
gentlemen.
Couple
of questions.
First
one,
maybe,
for Olaf,
just
around
the
CapEx,
4.5%
of
sales.
Is
that
actually
enough
to
keep
up
with
demand?
Conscious
you
just
had
a
year
of
almost
10%
volume
growth. Are
you
running
up
against
any
sort
of
capacity
constraints
that
need
to
be
alleviated?
And
maybe
a
second
question, a
bit broader, for
Heinz-Jürgen
around
Pet
Food
business.
Am
I
right
in
thinking
you are
outgrowing
the
end
market?
And
if
so,
can
you help
me
better
understand
who
you are
taking
share
from?
Is
that
the
big
pet
multinationals
increasingly
outsourcing
some
of
the things
that
they've
previously
done
in-house?
Or
is
your
technology
really
extending
your
lead
over
some
of
the
Tier 2
players?
And
I
guess
over
the
midterm,
you've
done
some
interesting
M&A
recently
to
move
deeper
into
certain
geographies
and
adjacent
products
like
health.
Just
how
big
do
you
think
this
pet
business
could
be
for
you
in
three
to
five
years'
time?
Thank
you.
H
Heinz-Jürgen Bertram
Yeah.
Matthew,
thanks
for
the
question.
So
first,
the
CapEx
at
the
moment,
it
was
4.5%,
which
is
industry
average.
But
you
may
bear
in
mind,
we
had
already
times
where
we
exceeded
7%.
So
you
see
from
there,
we
invest
whatever
is
necessary,
whatever
permits
our
growth.
And
going
forward,
I
believe,
Olaf,
you
gave
the
guidance
for
this
year
5%,
maybe
a
bit
more.
But
Matthew,
we
benefit
also
from
the
massive
investments
we've
done
over
the
last
few
years
and
to
improve
capacity,
it
shows
that
obviously
this
was
exactly
the
right
thing
to
do.
And
there
is
no
reason
to
be
concerned
that
2 points
–
4.5%
cuts
back
on
capacity
or
leads
us
to
capacity
increase
constraints.
We
are
very
confident
that,
first,
we
have
a
portfolio
which
is
future
oriented,
where
there
is
a
bright
future
ahead.
And
we
will
continue
to
invest
whatever
is
necessary.
And
in
that
respect,
we are
very
positive
4.5%,
which
we
did
last
year.
That
is
industry
standard
and
benchmark
is
typically
that
we
tend
to
have
a
slightly
higher
capacity
CapEx
level.
For
this
year,
we
expect,
as
I
said,
a
bit
more
than
5%,
but
no
reason
to
be
concerned
at
all
in
that
respect.
Pet
Food,
market
growth,
here,
we
see
a
strong
organic
growth
momentum.
We
may
take
market
share
from
smaller
players,
which,
frankly,
we
don't
know
exactly.
However,
what
it
shows
we
have
a
unique
position
in
that
segment.
And
the
recent
report
from
Barclays,
Pet
Food,
the
best
category
in
food
industry.
And
on
page
6,
under
point
9,
it
says
Symrise
is
the
only
company
who
made
meaningful
entrance
in
this.
So
that
is
a
unique
thing
which
differentiates
us
from
all
the
other
competitors.
And
we
will
continue
to
drive
this
unique
thing.
And
our
clear
goal
is
by
2025
we
will
have
this
€1.5
billion
business
unit.
I
think
that
shows
our
ambition.
And
so
Matthew,
in
that
respect,
the
best
is
yet
to
come,
okay?
M
Matthew Yates
Analyst, BofA Securities
Thanks
very
much,
guys.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Thank
you
for
the
question.
Next
question
comes
from
Heidi
Vesterinen
from
BNP
Paribas
Exane.
Please
go
ahead.
H
Heidi Vesterinen
Analyst, Exane BNP Paribas
Morning.
I,
first,
have
a
question
on
the
new
segment,
your
decision
to
rename
Flavor
&
Nutrition,
what
actually
changes
on
the
ground
and
for
your
customers?
And
are
you
now
a
believer
in
integrated
solutions?
H
Heinz-Jürgen Bertram
Heidi,
good
to
hear
from
you,
again.
And
well,
as
we
discussed
quite
a
few
times,
on
the
long
run,
it
made
sense
to
reshuffle
the
food
ingredient
and
the
flavor
business
to
put
it
together.
The
synergies
from
these
two
businesses
are
so
striking
that
there
are
top
and
bottom
line
synergies.
After
we
did
the
Diana
acquisition,
and
we
knew
we
did
the
damn
best
acquisition
in
our
industry.
We
took
our
time
to
develop
trust
and
to
preserve
all
the
assets.
One
of
them,
we
just
discussed
with
Matthew
so.
But
after
six
years,
it's
time
to
look
for
some
additional
synergies,
putting
it
together
just
makes
sense
and
I
think
does
not
come
by
surprise
for
many
of
you.
Integrated
solutions,
if
that
–
we
discussed
that
as
well.
If
that
means
one-stop
shopping,
I am
not
a
believer
in
it.
If
that
allows
additional
product
benefits,
plus
some
synergies,
as
we
need
just
one
team
for
the
same
accounts,
as
we
said,
and
that
we
have
a
lot
of
overlap
in
R&D.
For
example,
in
food
ingredient,
it
was
called
culinary.
In
flavors,
it
was
called
savory,
two
names
for
the
same
thing.
Why
not
combining
these
resources
and
addressing,
in
particular,
even
better
the
challenges
of
the
future,
Heidi,
which
is
protein
alternatives
and
sugar
replacement.
All
this
is
something
which
is
not
traditional
flavors,
but
close
to
flavors,
but
to
the
other
extent,
in
food
ingredients
to
some –
so
for
that
extent,
it
makes
sense
to
combine.
And
if
you
want
to
name
that
integrated
solution,
I'm
absolutely
with
you.
If
it
says
one-stop
shopping,
you
lost
me,
okay?
H
Heidi Vesterinen
Analyst, Exane BNP Paribas
Thank
you.
And
then
another
question,
I am
curious
about
your
ambition
in
Nutrition.
Do
you
think
you
will
stay
in
Pet
Food
or
do
you
see merit in
moving
outside
of
Pet
Food
in
a
big
way?
Say
if
you
found
acquisition
or
merger
opportunity
with
somebody
with
leadership
and
other
types
of
nutrition
solutions,
would
that
make
sense?
H
Heinz-Jürgen Bertram
At
this
point
in
time,
we
focus
on
expanding
our
Pet
Food
capabilities. I
just
gave
the
numbers,
and
I
think
there the
significant
growth.
And
short
and
midterm,
we
want
to
leverage
on
these
opportunities.
Heidi,
again,
this
is
something
which
makes
us
unique,
a
strong
differentiator
and
we
would
be
foolish
on
not
leveraging
on
that
potential.
In
that
area,
all
guns
are
loaded.
We
are
broadening
our
protein
basis.
That's
why
we
did
the
acquisition
of
ADF/IDF.
That's
why
we
did
the
next
acquisition,
Michael
Foods.
That's
why
we
did
the
acquisition
of Schaffelaarbos,
all
expanding
the
protein
basis
into
new
areas
and
with
Wing
Biotech,
broadening
our
business
presence
in
Pet
Food.
So
you
see
we
are
doing
everything
to
stress
that
one.
If
there
is
a
nutrition
opportunity
coming,
which
also
has
a bright
potential
and
makes
us
unique
in
that
respect,
we
are
open
to
it.
You
heard
from
Olaf, the
financial
headroom
is
there. But
at
the
moment,
our
focus
is
short
and
midterm
on
Pet
Food,
okay?
H
Heidi Vesterinen
Analyst, Exane BNP Paribas
Thank
you.
H
Heinz-Jürgen Bertram
You're
welcome.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Thanks,
Heidi,
very
much.
Next
question
comes
from
Thomas
Swoboda
from
Société
Générale.
Thomas,
please
go
ahead.
T
Thomas Swoboda
Analyst, Société Générale SA (Germany)
Yes.
Hello,
everybody,
and
thank
you
for
taking
my
questions.
I
have
three
quick
ones,
please.
On
volumes,
in
2022,
[audio gap]
(41:45-41:49) so
my
question
is,
do
you
expect
any
meaningful
volume
growth
in
2022,
or
is
2022
just
about
price?
My
second
question
is
about
phasing.
Some
of
your
competitors
were
pointing
towards
profitability
recovery
in
the
second
half
of
the
year.
It
doesn't
sound
like
you're
seeing
the
same.
So
just
to
confirm, you –
is
it
what
you
expect
a
rather
equal
normal
distribution
of
the
profit
generation
in
2022?
And
the
third
question
is
more
follow-up.
I am
not
sure
if
I
heard
you
correctly.
Do
you
see
inflation
already
flattening?
Or
do
you
fear
that
inflation
is
still
on
the
upper trend
and
that
you
might
need
to
go
back
to
your clients
and
increase
prices
again?
Thank
you.
H
Heinz-Jürgen Bertram
Thank
you,
Thomas.
I
start
and
then
I
hand
it
over
to
Olaf
to
give
you
more.
So, the
second
question
is
clear,
yes,
and
the
second
question –
the
third
question
is
a
no.
So
we
have
not
seen
the
end
of
inflation
yet.
So
there is
still
obviously
something
going
on,
not
that
steep,
but
it's
still
going
on.
And
with
the
latest
crisis,
we don't
know
where
it
ends.
But
we
feel
well
equipped
to
handle
it.
As
we
said,
thanks
to
the
raw
material –
to
our
backward
integration,
that
helps
to
navigate.
And in
profit,
we
don't
see
a
dip
in
first
half.
So
we
expect
it
to
be
on
a
good
level,
stable.
That's
why
we
did
our
guidance.
Olaf,
and
you
want
to
do
on
volume
and
price
and
all
this?
O
Olaf Klinger
Chief Financial Officer, Symrise AG
Yeah,
Thomas,
thanks
for
your
question.
Keep
in
mind,
I
mean,
we
will
have
very
high
comps
in
the
course
of
this
year
compared
to
last
year
as
everything
was
volume
driven.
So
what
we
said
is
that
volume
will
play
a
role,
but
there
will
be
substantially
more
price
to
deliver
the
5%
to
7%
growth
ambition.
I
think
that's
where
we
should
leave
it
at
the
moment
given
this
– dealing
all
the
unsecurity
we
have
in
our
environment.
You
see
us
very
comfortable
and
a good
part,
especially
in
Pet
Food
will
also
be
volume
driven.
T
Thomas Swoboda
Analyst, Société Générale SA (Germany)
Perfect.
Thanks.
O
Olaf Klinger
Chief Financial Officer, Symrise AG
You're
welcome.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Thanks
a
lot.
Very
good.
Next
question
comes
from
Isha
Sharma
from
Stifel.
Please
go
ahead.
I
Isha Sharma
Analyst, Stifel Europe Bank AG
Hi,
good
afternoon.
Thank
you
for
taking
my
questions.
I
just
have
two
left,
please.
On
the
EBITDA,
I
know
you've
already
answered
quite
a
bit
on
this.
But
just
to
clarify,
you
had
around
€25
million
of
adjustments
as
well
in
EBITDA,
and
they
were
more
on
the
positive
side.
So
the
reversal
of
this
going
into
next
year
along
with
price
increases,
which
usually
have
a
mathematical
dilution.
I am
unable
to
understand
how
I
can
make
a
bridge
of,
let's
say,
a
flattish
EBITDA
development
close
to
the
21.2%
that
you
have
reported for
2021.
And
the
second
question
is
on
sustainability.
You
strive
to
be
climate positive
by
2030.
What
exactly
do
you
mean
by
this?
Because
if
I
look
at
your
progress
to
[indiscernible]
(45:19)
CO2
reduction
and
also
your
commitment
to
science-based
targets,
you
are
lagging
behind
your
peers
in
the
same
industry.
So
some
light
on
that,
a little
bit
more
quantifiable
would
be
great.
Thank
you
so
much.
H
Heinz-Jürgen Bertram
First,
EBITDA
performance,
21%.
Olaf,
you
hop
in,
if
I am
not
giving
Isha
the
full
picture.
It's –
we
had
some
special
effects
this –
the
last
year.
And
we
give
our
guidance
out
for
this
year
21%,
because
we
believe
we
have,
as
we
said,
the raw –
the
backward
integration
will
have
–
help
us
even
through
the
turbulent
times.
We
have
acquired
the
Sensient
business,
which
was
highly
dilutive
and
we
have
indicated
that
to
the
market
strategically.
It
makes
a
lot
of
sense
because
it's
the
continuation
of
our
Pinova
business.
We have
shown
at
the
Pinova
business
that
we
were
able
to
improve
the
profitability
and
we
will
be
able
to
do
the
same
thing
this
year.
So
that
is
one
contributor,
which
will
help
us
very
well to
improve
the
EBITDA
margin
on
the
Scent
&
Care end.
And
the
other
side,
on
the
Flavor
&
Nutrition
end,
as
we
said,
we
have
divested
dilutive
businesses.
The
natural
color
business
was
dilutive
on
our
end
and
we
have
acquired
businesses,
which
are
accretive.
So
all
in
all,
that
gives
us
some
confidence,
good
confidence,
that
even
without
special
effects
and
adjustments,
we
will
be
able
to
get
to
around
21%.
And
we
are
confident
that
we
will
be
able
to
deliver
that.
On
the
other
side,
Isha,
you
confuse
me.
We
are
well
on
track
on
our
business
progress
to
bring
us
climate
positive.
And
in
that
respect,
we
believe
we
are
leading
compared
to
competition.
I am
not
aware
that
any
one
of
our
competitors
has
committed
to
be
climate
positive
by
2030.
And
in
our
annual
report
which
we
will
publish,
we
monitor
our
progress.
And
so
far,
we are
well
on
track.
In
2025,
I
think
we
will
have
reduced
our
CO2
emission
by
63%.
And
again
by
2030,
we
will
be
climate
positive.
We
have
done
initiatives,
which
are
different
to
anyone
else
in
our
industry.
We
have
built
our
own
power
plant,
amongst
others.
We
are
changing
all
our
processes.
Also,
again,
bear
in
mind,
where
you
have
been
with
us
in
Pinova,
green
chemistry,
sustainable
sourcing,
where
we
source
the
material
from
certified
forest,
and
that
was
actually
a
hint
from
one
of
our
key
customers
who
said,
you
can
be
the
first
and
only
ones
doing
this.
So
all
these
initiatives
show
we are
doing
unique
stuff,
and
we
are
on
the
forefront
of
sustainability.
So
wherever
you
got
the
information
from
that
we
lag
behind,
we
believe
we
have
different
information
and we are
well
on
track
on
it,
okay? Olaf,
you...
I
Isha Sharma
Analyst, Stifel Europe Bank AG
Maybe
we
can
take
this
offline.
Thank
you.
H
Heinz-Jürgen Bertram
Yeah.
We
–
anytime,
Isha.
I
Isha Sharma
Analyst, Stifel Europe Bank AG
Thank you.
H
Heinz-Jürgen Bertram
So,
Olaf,
you
want
to
add?
So
it
was
complete,
okay? Thanks, Olaf.
O
Olaf Klinger
Chief Financial Officer, Symrise AG
Nothing
to add.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Should
I
jump
in? Yeah.
Isha,
thanks
a
lot. The rest, we will
take
offline.
O
Olaf Klinger
Chief Financial Officer, Symrise AG
Thanks
a
lot,
Isha.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
And the
next
question
comes
from
Charles
Bentley
from
Jefferies.
Charlie,
please
go
ahead.
C
Charles Bentley
Analyst, Jefferies International Ltd.
All
right.
Thanks
for
taking my
questions.
So sorry
to
keep
on
coming back,
but
just
on
price
into
next
year.
So
you are
talking
around
6%
raw
material
cost
inflation,
plus
the
kind
of
2%
from
FY
2021
with
no
pricing.
So
if I
to
assume
any
further
increases,
that
would
imply
probably
3%
pricing
to
offset.
Is
that
a
fair
assumption?
Do
you
think
you
can
kind
of
get
there?
And
then
if
I
just
look
at
the
kind
of
margin
cadence
into
2022,
I
mean,
I
think
that
the
margins
in
Scent &
Care
should
obviously
be
higher
than
in
the
second
half of
2021.
If
you
can
kind of
help
with
kind
of
2020
–
sorry,
the
first
half
versus
the
second
half?
And
then
also
in
Flavor
&
Nutrition,
that would
be
very
helpful.
Thank
you.
H
Heinz-Jürgen Bertram
So
Scent
& Care, as
I am
responsible,
yes,
it
should
be
certainly
higher
second
half
of
last
year.
As
I
said,
in
second
half,
we
had
Sensient
acquisition
and
with
all
dilutive
effect.
And
you
will
see
we
are
making
progress.
And
we
have
shown
it
with
Pinova
that
we
know
what
to
do
and
how
to
do.
We're
very
confident
that
we
will
see
some
progress
there.
Nothing
to
be
concerned
at
all.
Olaf,
you
want
to
add
to the
other
point?
O
Olaf Klinger
Chief Financial Officer, Symrise AG
No,
I
mean,
Heinz,
you
mentioned
the
Scent
&
Care
situation
last
year,
I
mentioned
in
my
speech
that
we
had,
of
course, in
the
second
half,
higher
packaging,
higher
energy,
higher
logistic
costs,
and
we
took
price
increases
in
the
second
half
of
last
year,
which
will
kick
in
only
this
year
to
the
majority.
So
let
us
work
on
this,
as
described,
and
I
think
that's
where
we
should
leave
it
at
the
moment
to
protect
our
margin
environment.
C
Charles Bentley
Analyst, Jefferies International Ltd.
Okay.
Great.
Can
I
just
follow
up
on
one
question?
So
just
on
Q1
–
sorry
on
H1
margins,
would
you
expect
them
for
the
group
to
be
higher
than
in
the
second
half?
H
Heinz-Jürgen Bertram
The
margins,
as
the
previous
question,
I
think,
from
Lisa,
was
we
expect
not
a
dip
in
margin
for
the
first
half,
and
we
do
not
expect
a
slight
dip
in
margin
in
the
second
half.
As
per
now,
we
believe
we
will
show
a
stable
and
healthy
margin
throughout
the
year,
okay?
C
Charles Bentley
Analyst, Jefferies International Ltd.
Great.
Thanks,
Heinz-Jürgen.
Thanks
a
lot.
H
Heinz-Jürgen Bertram
You're
welcome.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Charlie,
many
thanks.
We're
getting
closer
to
the
end
of
our
today's
conference
call.
Last
question
comes
from
Charles
Eden
from
UBS.
Charles,
please
go
ahead.
C
Charles Eden
Analyst, UBS AG (London Branch)
Hi,
good
afternoon.
Thanks
for
taking
me
in.
Just
two
quick
ones
for
me.
Firstly,
can
you
remind
us
with
respect
to
the
cyber-attack,
have
you
received
your
insurance
payment
for
that?
If
so,
is
it
booked
in
FY
2021,
or
is
that
something
to
come
in
2022?
And
then
my
second
question,
just
in
Flavors.
Can
you
just
talk
a
bit
about
the
growth
expectation
by
the
categories, say,
beverages,
savory,
sweet,
dairy?
Is
there
any
significant
variance
in
growth
you're
expecting
in
2022
across
that
division?
Thank
you.
H
Heinz-Jürgen Bertram
Okay.
Olaf,
you
may
want to
handle
the
cyber
thing,
and
I
handle
this
growth
expectation
by
flavors.
You
start?
O
Olaf Klinger
Chief Financial Officer, Symrise AG
So
on
cyber,
the
reimbursement
is
expected
this
year
and
there's
nothing
in
the
books
yet.
H
Heinz-Jürgen Bertram
Okay.
That
was
precise,
crisp
and
short.
So
I am
talking
flavors.
So
from
what
we
see
now, we
expect
a
continuous
healthy
momentum
in
beverages.
And
we
think
with
the
acquisitions
we
have
done
recently,
we
will
also
continue
to
benefit
in
culinary/savory.
Having
said
that,
that
is
by
categories
and
categories
to
highlight
the
areas
of
growth.
We
see
a
strong
momentum
in
Asia
going
in
the
past.
And
this,
we
expect
to
go
on.
So
by
regions,
I
would
stress
Asia,
we
expect
most
dynamics
and,
in
particular,
in
the
categories,
beverages
and
culinary,
okay?
C
Charles Eden
Analyst, UBS AG (London Branch)
That's
great.
Thank
you.
And
Olaf, are
you
able
to
give
any
sort
of
size
guidance
on
that
insurance
payout,
and
will
it
go
into
your
core
numbers
or
adjusted
it
for
your
GAAP numbers?
Thank
you.
O
Olaf Klinger
Chief Financial Officer, Symrise AG
Again,
it's
not
in
the
guidance,
and
therefore,
I
think
let's
wait
for
the
outcome,
and
I
will
inform
you,
of
course,
once
we
have
clarity
on
this.
C
Charles Eden
Analyst, UBS AG (London Branch)
All Right.
Thank
you.
H
Heinz-Jürgen Bertram
Okay.
T
Tobias Erfurth
Head-Investor Relations, Symrise AG
Thank
you.
Dear
participants,
this
brings
us
to
the
end
of our
today's
conference
call.
I
know
that
you
are
all
very
busy
today
with
so
many
companies
presenting
results.
So
we
are
thankful
for
your
time
today
and
your
ongoing
interest
in
Symrise.
We are
looking
forward
to
seeing
you
in
the
upcoming
virtual
conferences
and
virtual
roadshows.
And
above
all,
we
hope
to
see
you
in-person
soon.
We
will
publish
our
trading
update
for
the
first
quarter
on
April
27.
That's
it
for
today.
So
thank
you
very
much.
Good-bye,
and
have
a
nice
day.
Operator
We
want
to
thank
all
the
participants
of
this
conference.
Thank
you.
Good-bye.
Here we go. Good afternoon or good morning, ladies and gentlemen. Welcome to the Presentation of the Symrise 2021 Full Year Results. With me in this conference call are our CEO, Dr. Heinz-Jürgen Bertram; and our CFO, Olaf Klinger.
The ongoing corona pandemic has unfortunately kept us again from hosting this event in-person in Frankfurt, but we are happy to have you in this virtual format instead. We will go through our results and provide an outlook on the current year from our headquarters here in Holzminden. You will, of course, also have the opportunity to ask questions during the Q&A session, following the presentation. All documents have been published on our webpage this morning in the section, Investors at Financial Results. You can also find the recording of this session later today.
I will now hand over to our CEO, Dr. Heinz-Jürgen Bertram. Please go ahead.
Thank you, Tobias. Good morning, ladies and gentlemen, and welcome also from my side. I am delighted that so many of you have taken the time to join our call today. I will begin with the highlights of 2021. Olaf will then provide a deep dive into the financials before I conclude with our key strategic initiatives and an outlook for the road ahead.
Let us have a look at chart 4. The year 2021 was clearly marked by a strong economic recovery from the effects of the global coronavirus pandemic. The improved situation led to fewer restrictions. The social life gained good momentum again. However, particularly since the second half of the year, the economy has been facing persistent bottlenecks in supply chains.
Rising inflationary effects and higher raw material prices intensified the pressure on economies worldwide. As other players, Symrise was also influenced by these factors. But we successfully capitalized on returning demand and continued our profitable growth course despite some headwinds.
Our diversified portfolio and our backward integration have been decisive factors for success. We are, therefore, looking at an all-around very satisfactory year 2021. We grew sales by around 9% to over €3.8 billion. Organic growth was even stronger at almost 10%.
EBITDA increased by 9.6% to €814 million and our profitability remained at a high level of 21.3%. The business free cash flow amounted to €486 million and equals about 13% of sales. Net income grew by more than 20% to €375 million, which corresponds to €2.74 per share.
Our dividend proposal amounts to €1.02 per share for fiscal year 2021. This proposal represents, ladies and gentlemen, the 12th consecutive dividend increase. Let me conclude the snapshot with one more highlight, our DAX membership. After 14 years in the German MDAX, we have become member of the leading German index last September. Our share gains even more visibility and interest amongst shareholders now.
Taking a look at our sales growth on chart 5. Group sales increased to over €3.8 billion, including €40 million of Sensient Fragrances, which we had acquired last year. Organically, the group achieved even stronger growth of 9.6%, driven by both segments and all regions. We not only exceeded our sales forecast, which we had raised twice last year, but also outperformed market growth.
In both segments, we observed normalization in consumer behavior and increased demand, which page 6 illustrates. Taste, Nutrition & Health, our renamed segment, which resulted from the combination of our two former Flavor and Nutrition segments, generated sales of €2.3 billion. Organic growth amounted to an excellent 10.6%. The renewed out-of-home consumption boosted demand, particularly for beverage applications. A strong growth driver was once again our Pet Food business, which grew in the double-digit percentage range.
Our Scent & Care segment also performed extremely well. Sales rose by 8.9% to around €1.5 billion and organic growth came to 7.9%, driven by all application areas. Fine Fragrances and Cosmetic Ingredients particularly benefited from the resumption of travel.
Coming to our regions where we also have a very good news to share on chart 7. We grew across all regions with Latin America being the strongest one and delivering organic growth of 13.5%. Asia Pacific achieved organic growth of 10.3%. EAME and North America generated very good organic growth rates of 8.8% and 8.5%, respectively.
Symrise is sustainable in more than one respect. We stand for sustainable operations and sourcing. We also stand for a very sustainable financial performance, as you can see on chart 8. Since our IPO in 2006, we delivered an annual compounded growth of around 8%. Our EBITDA CAGR amounts to an excellent 8.4% and our profitability is on a constantly high level. We're creating value every single year. This makes us very proud. And I would like to thank all our employees worldwide for their tireless work, commitment and dedication.
As chart 9 shows, our share price has also performed very well gaining more than 20% in 2021. We outperformed both MDAX and DAX and consider this a confirmation of our attractiveness. But it also reflects the trust investors have in our strategy and long-term prospects.
It is part of our Investor Relations philosophy to have our shareholders participate in Symrise's success. The management and supervisory board will, therefore, propose a 2021 dividend of €1.02 per share. This proposal represents the 12th consecutive dividend increase and is another indicator for our commitment to long-term value creation.
Let me pause here and turn to Olaf. He will now provide the details on our financials. Olaf?
Yeah, thank you very much, Heinz-Jürgen, and also warm welcome from my side. Let me start straight away with our sales development on group level on slide 11. We achieved strong organic growth of 9.6%, which is far above market growth. But not only that, we also outperformed our guidance of average annual organic sales growth between 5% and 7%. It is particularly important to note that sales growth was driven by volume, not price. This will change in the current year towards substantially more contribution from price.
Going through major events this year, Q1 was still characterized by the cyber-attack that hit us at the end of 2020. We recovered within weeks and caught up the vast majority of the missed turnover quickly. Special thanks go to our clients and partners for their support and our Symrise colleagues for their extra effort to recover our IT system environment in an accelerated mode.
Throughout the year, global consumer demand caught up immensely. Travel activity and the leisure sector particularly benefited, which drove the need for cosmetic applications and beverage solutions. Also, our Pet Food activities performed extraordinarily well, supported also by ADF/IDF, which we acquired back in 2019, and which continues to perform well ahead of our initial expectations.
The performance of the Sensient Fragrance acquisition was fully in line with our initial expectations. The business contributed sales of €41 million and in addition to acting as internal raw material supplier. In terms of FX, we had negative effects of €73 million for the full year, but positive sales impact on €20 million – of €23 million in Q4. For 2022, we expect FX tailwind that will support our reported top line as well as our group sales target of €4 billion to €4.5 billion, which we gave in 2019 for the year 2022. We are fully on track to deliver on our mid-term ambitions.
On to our profitability on slide 12. Gross margin amounted to 38.7% compared to 39.5% in 2020. The development is linked to higher manufacturing costs and increased raw material expenses with an inflation of about 1.2% last year. Our P&L has been impacted by a few extraordinary items. We experienced M&A-related transaction cost of €8.7 million, positive one-off items came from the sale of the color business with plus €12.5 million and from the favorable book value of the Sensient Fragrance acquisition with plus €20.8 million. Please keep in mind that the substantial benefit from the book value is connected to an initially low profitability of the acquired Sensient Fragrance business.
EBITDA grew by 9.6%, also supported by lower travel and R&D costs. Our EBITDA margin increased to 21.3% after an already strong level of 21.1% the year before. While depreciation increased moderately, amortization decreased by around €4 million, mainly due to the end of the amortization period of IT software solutions. As a consequence, our EBIT rose over proportionally by 14.7% and our EBIT margin reached a solid level of 14.6% compared to 13.8% in 2020.
Let us now look into the segments, starting with Taste, Nutrition & Health on slide 13. The segment successfully leveraged returning consumer preferences and achieved an organic grow – sales growth of 10.6%. We saw an exceptional upturn in beverage solutions, followed by double-digit growth in Pet Food activities. EBITDA grew by 12.9% or €60 million to €531 million. The segment increased its EBITDA margin to 22.7% and operated highly profitable despite higher costs. Our strategy to invest into faster growing and more profitable businesses starts to pay off. In addition, initial steps to increase prices were successfully taken.
On to Scent & Care on slide 14, Scent & Care achieved organic sales growth of 7.9%. Main growth drivers were Fine Fragrances and Cosmetic Ingredients, which both benefited from the normalization of consumer behavior and experienced an excellent upswing after the sharp decline in 2020. Aroma Molecules was supported by strong demand and further capacities for menthol built during the recent years. Consumer Fragrances and Oral Care achieved single-digit sales growth following exceptional high levels in the prior year.
EBITDA in Scent & Care increased by 4.1% or €11 million to €283 million. The margin totaled 19% compared to 19.8% the year before. The decline was mainly due to a below average operational margin at Sensient Fragrances, increased raw material costs and higher manufacturing costs. During the second half of the year, Scent & Care experienced higher costs related to increased logistics, energy as well as packaging costs. While price increase initiatives were taken early on in the second half of last year, the effect will mostly come in starting this year due to the nature of customer contacts, especially in Aroma Molecules and Cosmetic Ingredients.
Turning now to the financial result and bottom line on slide 15. The financial result improved by around €21 million and reflects generally lower financing costs in 2021. In addition, we had a one-off effect payment to tax authorities during the year before. At the Capital Markets Day in January 2019, I gave a tax guidance of 26% to 28%. Since our tax rate developed well and further decreased from 25.6% to 25.4% last year, I would like to update our tax guidance to now 25% to 27% for the coming years.
Our bottom line grew by more than 20% to €375 million. EPS reached a new all-time high at €2.74. It is also to be kept in mind that the number of shares increased because of the conversion of the convertible bond into new shares in September last year. Please take note that the EPS is calculated based on a weighted average number of shares last year. As stated by Heinz-Jürgen, management and supervisory board will propose a dividend increase to €1.02 per share.
Let's continue with our business free cash flow on slide 16. The level for 2021 remained below the high levels of the previous two years despite strong EBITDA growth for three reasons. First, 2021 was a year of important investments. We spent €174 million, including some strategic growth initiatives. Second, we increased working capital as a result of the cyber-attack in late 2020, as well as strategic inventories to maneuver risk and the global supply chain. And third, with a higher level of trade receivables due to the strong growth in sales. Despite the strong earnings growth, business free cash flow settled at 12.7% of sales. For 2022, we are optimistic to reach a level of around 14% of sales again.
Moving on to net debt development on slide 17. With the increase in capital and further reduction of debt, net debt, including pensions and leasing obligations, totaled 2.4 times EBITDA as of December 31. For 2022, we expect a slightly higher leverage ratio of 2.5 to 2.7 times, driven by recent and further expected M&A activities. Our top priority still remains to be an investment-grade profile.
Taking a closer look at the balance sheet on slide 18. Investments and acquisitions increased property, plant and equipment as well as intangibles. The increase in other assets results from the participation in Swedencare. In August, we decided to redeem our €400 million convertible bond really by conversion into new shares. Our equity increased by €890 million to €3,252 million. Next to the conversion of the convertible, we benefited from positive FX translation differences of around €170 million, as well as an increase in accumulated profit and other reserves of around €276 million.
Our equity ratio, therefore, closed the year at a very healthy level of 49%. All in all, we enjoyed another successful year with profitable growth at Symrise, once, again, confirming the resistance of our business model in challenging times.
And after this financial deep dive, I now hand back to Heinz-Jürgen.
Thank you, Olaf. Ladies and gentlemen, let us look at the strategic initiatives. They have supported our performance in 2021 and which will bear further fruit going forward. Chart 20 illustrates our new corporate structure and gives background to establish the Taste, Nutrition & Health segment. We have decided to bundle the Flavor & Nutrition competencies and build a global powerhouse around Taste, Nutrition & Health, three assets which are closely tied together.
With an expanded portfolio, we are in an even better position. First, to serve the needs of our customers with sustainable and innovative products and solutions. Second, to tackle promising new markets. And third to further increase our competitiveness through unique capabilities. M&A have traditionally been important elements for differentiation and growth. Please have, therefore, a look at page 21.
For example, Canadian Giraffe Foods, the company will strengthen our food business via customized taste concept and make us a leading provider of integrated food solutions in North America. Pet Food is a key driver for our portfolio and our growth, and we even want to expand our position as the leading international supplier for pet food solutions. We acquired a minority stake in Swedencare and aim to strengthen our knowledge of veterinary products supporting the well-being of pets.
The Dutch company, Schaffelaarbos is an excellent example for expanding our position in egg-based proteins. As you all know, APAC has traditionally been a highly promising region for us, and with the acquisition of Chinese Wing Pet Food, we just announced a few days ago, we intend to further increase our footprint in pet food in the region. At the same time, we stopped activities. The core business no longer includes the food color applications, which we sold to Oterra, as well as the Drinkstar Velcorin activities.
In the Scent & Care segment too, the wheels have not stood still, as you can see on chart 22. We have reorganized our regional presence and expanded our portfolio through targeted acquisitions and strategic partnerships.
I want to highlight three here. With Sensient, we have strengthened our Fragrance and Aroma Molecules business. As part of this acquisition, we also acquired the Sensient site in Granada. It will become an important European hub for our Scent & Care business. Two more important steps have been realized with a minority interest in US-based Kobo Beauty, Inc. and a cooperation agreement with the US startup, Infinite Looks. Both demonstrate our efforts to further expand our portfolio in attractive business and product areas, namely UV protection, decorative cosmetics and hair care. These acquisitions and divestments show our clear commitment to continuously improve our portfolio and make Symrise a unique player.
Sustainability is and always has been an integral part of our strategy. For this, please see chart 23. Our approach is fully aligned with the UN sustainability goals and embedded in all our operations from sourcing thousands of raw materials from all over the world to the production process to delivery to the customer. We let ourselves be measured by a number of KPIs. And it is our clear goal to become climate positive by 2030.
Our commitment to climate protection is already recognized today. For example, by the Carbon Disclosure Project, Symrise was awarded triple A status for the second consecutive year in a row in all three categories water, climate, as well as forest. We are the only company in Germany and 1 of only 14 worldwide with that status. Investments pave the way to growth in the future.
Chart 24 highlights some selected projects, which comprise investments into new capacities, as well as R&D. We have, for example, built a new site for our Pet Food division in China and set up a new innovation center in Dubai. On the R&D side, we have put a particular focus on innovations. For instance, the launch of SymProBiome, which is a new model for microbiome-based research. And in the area of advanced technologies, we have invested in a very exciting digital tool to improve traceability of global farming. It allows us to collect structure and coordinate agronomic data from around the world.
I want to conclude today's presentation with the outlook for this year, on page 25. Following the strong recovery in 2021, experts estimate that the global economy will grow more moderately this year. In addition, I am sure this is not a surprise to you. We expect an increase in selective raw material and energy prices. Also, the crisis in the Ukraine and the impact for all of us cannot be foreseen today. However, we are confident that we are very good positioned to continue our profitable growth course.
Our robust business model with its diversified portfolio, our far-reaching international presence and broad customer base give us tailwind. For 2022, we are targeting organic growth of 5% to 7% in line with our mid-term guidance. Despite headwinds from raw material and energy prices, we aim at an EBITDA margin of around 21%.
Ladies and gentlemen, thank you for your attention. I would now like to open the call for your questions. Tobias?
Many thanks, Heinz-Jürgen. And many thanks, Olaf. Turning to Q&A, we are now happy to take the questions from the audience. And the first question comes from Lisa De Neve from Morgan Stanley. Lisa, please go ahead.
Hi, good afternoon, and thank you for taking my question. I have two. So the first one is on the EBITDA margin. You are guiding to about 21% margin at this point in time of the year for 2022. So can you please share just sort of building blocks that underpin that guidance, especially as it relates to raw material inflation, degree of pricing, synergies you may expect? And maybe also on the adjusted versus reported line, any sort of integration or startup costs we should calculate or take into account? That would be super helpful.
So, Lisa, and I start, and I would say, Olaf, you take the mix of price increases and volume and all this stuff. So one point, which I just stressed is, we have consequently improved and managed our portfolio. So assets, which were not core business anymore or which were dilutive on our margin, we sold. And we have consequently looked for business areas with a better business perspective, and if possible, even an accretive business bottom line contribution. Olaf?
Yeah. So from our perspective, the EBITDA margin is supported by price increases which we started last year quite a little bit. We are seeing them coming in. So the 5% to 7% growth guidance for this year will incorporate a substantial amount of price here. That's one driver.
The second driver I would highlight is, again, the strong development of our portfolio into fast growing, high margin businesses. I think we have seen a few acquisitions in the last few months, and all of them will be accretive. And therefore, the mix in this regard will further improve our profile. So the diversification of the group continues in this regard and supports well the margin expectation.
Can I just follow up a little bit on the raw materials and the pricing specifically? Can you just share what you are seeing on the raw material landscape in terms of the degree of raw material inflation you are expecting for this year? And to which extent, you've been able to renegotiate that via pricing on the top line? How should we think about pricing versus raw materials this year and sort of the timeline that's lapping that if that's what's going to happen? Thank you.
So I will start, Olaf, and you hop in if you feel there is something more to be added. As what we said beginning of last year, we expected for last year 1% to 2% price increases. And for last year, we saw a bit more, say, than 2%, but around the guidance we gave at the beginning of last year was correct, with the caveat that most of the price increases of last year happened in the last quarter.
And so happened it this year, we saw a steep price increase in the beginning of this year. We expect about 6% on top of it. So that brings us to, say, in total, 8%, and we discussed it last year already. We had started in time to pass on price increases for the products. And as per now, we feel well-equipped that we have managed to pass on most of our, if not all of the price increases to the customers.
As Olaf has said, not all of these price increases which we pass through have been materializing yet because some of the contracts, in particular, in the Aroma Molecules area, but also in Flavors and Fragrance are still valid. And – but in the next weeks or month, these price increases will come through.
So of course, the situation is not always clear and visible to us how it continues to develop. But as per now, we feel confident that we have been able to pass on the price increases or that these price increases will go through within the next weeks. Olaf, if you want to add a bit more?
No, I think you said it. And keep in mind, I mean, we have a raw material base of 10,000 raw materials. So across this portfolio, you see, of course, different elements coming through. And some price increases have been extremely substantial, like in Aroma Molecules, very substantial double-digit numbers we needed to take.
Similar in Pet Food, we had substantial price increases initiated last year. So across the portfolio, it will come through in different magnitudes. We said in the past three to six months, it takes us normally to [ph] pass the two (32:35). Maybe this year, it might be a little bit longer because the increases continue, and we need to see how we play this out. But no worry at the moment on our end that we will not be successful in protecting our margin environment.
And one key message which I would like to highlight in addition to what Olaf said, we benefit from the best backward integration in our industry. And in times when we have crisis, then we typically benefit from this. And in this time, it again shows the value of our business model, and that's why we are confident for this year as well.
Thank you very much, guys.
You're welcome.
Well, thank you very much, Lisa. Next question comes from Matthew Yates from Bank of America please.
Hey. Good morning, gentlemen. Couple of questions. First one, maybe, for Olaf, just around the CapEx, 4.5% of sales. Is that actually enough to keep up with demand? Conscious you just had a year of almost 10% volume growth. Are you running up against any sort of capacity constraints that need to be alleviated?
And maybe a second question, a bit broader, for Heinz-Jürgen around Pet Food business. Am I right in thinking you are outgrowing the end market? And if so, can you help me better understand who you are taking share from? Is that the big pet multinationals increasingly outsourcing some of the things that they've previously done in-house? Or is your technology really extending your lead over some of the Tier 2 players?
And I guess over the midterm, you've done some interesting M&A recently to move deeper into certain geographies and adjacent products like health. Just how big do you think this pet business could be for you in three to five years' time? Thank you.
Yeah. Matthew, thanks for the question. So first, the CapEx at the moment, it was 4.5%, which is industry average. But you may bear in mind, we had already times where we exceeded 7%. So you see from there, we invest whatever is necessary, whatever permits our growth. And going forward, I believe, Olaf, you gave the guidance for this year 5%, maybe a bit more.
But Matthew, we benefit also from the massive investments we've done over the last few years and to improve capacity, it shows that obviously this was exactly the right thing to do. And there is no reason to be concerned that 2 points – 4.5% cuts back on capacity or leads us to capacity increase constraints.
We are very confident that, first, we have a portfolio which is future oriented, where there is a bright future ahead. And we will continue to invest whatever is necessary. And in that respect, we are very positive 4.5%, which we did last year. That is industry standard and benchmark is typically that we tend to have a slightly higher capacity CapEx level. For this year, we expect, as I said, a bit more than 5%, but no reason to be concerned at all in that respect.
Pet Food, market growth, here, we see a strong organic growth momentum. We may take market share from smaller players, which, frankly, we don't know exactly. However, what it shows we have a unique position in that segment. And the recent report from Barclays, Pet Food, the best category in food industry. And on page 6, under point 9, it says Symrise is the only company who made meaningful entrance in this.
So that is a unique thing which differentiates us from all the other competitors. And we will continue to drive this unique thing. And our clear goal is by 2025 we will have this €1.5 billion business unit. I think that shows our ambition. And so Matthew, in that respect, the best is yet to come, okay?
Thanks very much, guys.
Thank you for the question. Next question comes from Heidi Vesterinen from BNP Paribas Exane. Please go ahead.
Morning. I, first, have a question on the new segment, your decision to rename Flavor & Nutrition, what actually changes on the ground and for your customers? And are you now a believer in integrated solutions?
Heidi, good to hear from you, again. And well, as we discussed quite a few times, on the long run, it made sense to reshuffle the food ingredient and the flavor business to put it together. The synergies from these two businesses are so striking that there are top and bottom line synergies.
After we did the Diana acquisition, and we knew we did the damn best acquisition in our industry. We took our time to develop trust and to preserve all the assets. One of them, we just discussed with Matthew so. But after six years, it's time to look for some additional synergies, putting it together just makes sense and I think does not come by surprise for many of you.
Integrated solutions, if that – we discussed that as well. If that means one-stop shopping, I am not a believer in it. If that allows additional product benefits, plus some synergies, as we need just one team for the same accounts, as we said, and that we have a lot of overlap in R&D. For example, in food ingredient, it was called culinary. In flavors, it was called savory, two names for the same thing. Why not combining these resources and addressing, in particular, even better the challenges of the future, Heidi, which is protein alternatives and sugar replacement.
All this is something which is not traditional flavors, but close to flavors, but to the other extent, in food ingredients to some – so for that extent, it makes sense to combine. And if you want to name that integrated solution, I'm absolutely with you. If it says one-stop shopping, you lost me, okay?
Thank you. And then another question, I am curious about your ambition in Nutrition. Do you think you will stay in Pet Food or do you see merit in moving outside of Pet Food in a big way? Say if you found acquisition or merger opportunity with somebody with leadership and other types of nutrition solutions, would that make sense?
At this point in time, we focus on expanding our Pet Food capabilities. I just gave the numbers, and I think there the significant growth. And short and midterm, we want to leverage on these opportunities. Heidi, again, this is something which makes us unique, a strong differentiator and we would be foolish on not leveraging on that potential.
In that area, all guns are loaded. We are broadening our protein basis. That's why we did the acquisition of ADF/IDF. That's why we did the next acquisition, Michael Foods. That's why we did the acquisition of Schaffelaarbos, all expanding the protein basis into new areas and with Wing Biotech, broadening our business presence in Pet Food. So you see we are doing everything to stress that one.
If there is a nutrition opportunity coming, which also has a bright potential and makes us unique in that respect, we are open to it. You heard from Olaf, the financial headroom is there. But at the moment, our focus is short and midterm on Pet Food, okay?
Thank you.
You're welcome.
Thanks, Heidi, very much. Next question comes from Thomas Swoboda from Société Générale. Thomas, please go ahead.
Yes. Hello, everybody, and thank you for taking my questions. I have three quick ones, please. On volumes, in 2022, [audio gap] (41:45-41:49) so my question is, do you expect any meaningful volume growth in 2022, or is 2022 just about price?
My second question is about phasing. Some of your competitors were pointing towards profitability recovery in the second half of the year. It doesn't sound like you're seeing the same. So just to confirm, you – is it what you expect a rather equal normal distribution of the profit generation in 2022?
And the third question is more follow-up. I am not sure if I heard you correctly. Do you see inflation already flattening? Or do you fear that inflation is still on the upper trend and that you might need to go back to your clients and increase prices again? Thank you.
Thank you, Thomas. I start and then I hand it over to Olaf to give you more. So, the second question is clear, yes, and the second question – the third question is a no. So we have not seen the end of inflation yet. So there is still obviously something going on, not that steep, but it's still going on. And with the latest crisis, we don't know where it ends. But we feel well equipped to handle it.
As we said, thanks to the raw material – to our backward integration, that helps to navigate. And in profit, we don't see a dip in first half. So we expect it to be on a good level, stable. That's why we did our guidance. Olaf, and you want to do on volume and price and all this?
Yeah, Thomas, thanks for your question. Keep in mind, I mean, we will have very high comps in the course of this year compared to last year as everything was volume driven. So what we said is that volume will play a role, but there will be substantially more price to deliver the 5% to 7% growth ambition. I think that's where we should leave it at the moment given this – dealing all the unsecurity we have in our environment. You see us very comfortable and a good part, especially in Pet Food will also be volume driven.
Perfect. Thanks.
You're welcome.
Thanks a lot. Very good. Next question comes from Isha Sharma from Stifel. Please go ahead.
Hi, good afternoon. Thank you for taking my questions. I just have two left, please. On the EBITDA, I know you've already answered quite a bit on this. But just to clarify, you had around €25 million of adjustments as well in EBITDA, and they were more on the positive side. So the reversal of this going into next year along with price increases, which usually have a mathematical dilution. I am unable to understand how I can make a bridge of, let's say, a flattish EBITDA development close to the 21.2% that you have reported for 2021.
And the second question is on sustainability. You strive to be climate positive by 2030. What exactly do you mean by this? Because if I look at your progress to [indiscernible] (45:19) CO2 reduction and also your commitment to science-based targets, you are lagging behind your peers in the same industry. So some light on that, a little bit more quantifiable would be great. Thank you so much.
First, EBITDA performance, 21%. Olaf, you hop in, if I am not giving Isha the full picture. It's – we had some special effects this – the last year. And we give our guidance out for this year 21%, because we believe we have, as we said, the raw – the backward integration will have – help us even through the turbulent times. We have acquired the Sensient business, which was highly dilutive and we have indicated that to the market strategically.
It makes a lot of sense because it's the continuation of our Pinova business. We have shown at the Pinova business that we were able to improve the profitability and we will be able to do the same thing this year. So that is one contributor, which will help us very well to improve the EBITDA margin on the Scent & Care end.
And the other side, on the Flavor & Nutrition end, as we said, we have divested dilutive businesses. The natural color business was dilutive on our end and we have acquired businesses, which are accretive. So all in all, that gives us some confidence, good confidence, that even without special effects and adjustments, we will be able to get to around 21%. And we are confident that we will be able to deliver that.
On the other side, Isha, you confuse me. We are well on track on our business progress to bring us climate positive. And in that respect, we believe we are leading compared to competition. I am not aware that any one of our competitors has committed to be climate positive by 2030. And in our annual report which we will publish, we monitor our progress. And so far, we are well on track. In 2025, I think we will have reduced our CO2 emission by 63%. And again by 2030, we will be climate positive. We have done initiatives, which are different to anyone else in our industry. We have built our own power plant, amongst others. We are changing all our processes.
Also, again, bear in mind, where you have been with us in Pinova, green chemistry, sustainable sourcing, where we source the material from certified forest, and that was actually a hint from one of our key customers who said, you can be the first and only ones doing this. So all these initiatives show we are doing unique stuff, and we are on the forefront of sustainability. So wherever you got the information from that we lag behind, we believe we have different information and we are well on track on it, okay? Olaf, you...
Maybe we can take this offline. Thank you.
Yeah. We – anytime, Isha.
Thank you.
So, Olaf, you want to add? So it was complete, okay? Thanks, Olaf.
Nothing to add.
Should I jump in? Yeah. Isha, thanks a lot. The rest, we will take offline.
Thanks a lot, Isha.
And the next question comes from Charles Bentley from Jefferies. Charlie, please go ahead.
All right. Thanks for taking my questions. So sorry to keep on coming back, but just on price into next year. So you are talking around 6% raw material cost inflation, plus the kind of 2% from FY 2021 with no pricing. So if I to assume any further increases, that would imply probably 3% pricing to offset. Is that a fair assumption? Do you think you can kind of get there?
And then if I just look at the kind of margin cadence into 2022, I mean, I think that the margins in Scent & Care should obviously be higher than in the second half of 2021. If you can kind of help with kind of 2020 – sorry, the first half versus the second half? And then also in Flavor & Nutrition, that would be very helpful. Thank you.
So Scent & Care, as I am responsible, yes, it should be certainly higher second half of last year. As I said, in second half, we had Sensient acquisition and with all dilutive effect. And you will see we are making progress. And we have shown it with Pinova that we know what to do and how to do. We're very confident that we will see some progress there. Nothing to be concerned at all. Olaf, you want to add to the other point?
No, I mean, Heinz, you mentioned the Scent & Care situation last year, I mentioned in my speech that we had, of course, in the second half, higher packaging, higher energy, higher logistic costs, and we took price increases in the second half of last year, which will kick in only this year to the majority. So let us work on this, as described, and I think that's where we should leave it at the moment to protect our margin environment.
Okay. Great. Can I just follow up on one question? So just on Q1 – sorry on H1 margins, would you expect them for the group to be higher than in the second half?
The margins, as the previous question, I think, from Lisa, was we expect not a dip in margin for the first half, and we do not expect a slight dip in margin in the second half. As per now, we believe we will show a stable and healthy margin throughout the year, okay?
Great. Thanks, Heinz-Jürgen. Thanks a lot.
You're welcome.
Charlie, many thanks. We're getting closer to the end of our today's conference call. Last question comes from Charles Eden from UBS. Charles, please go ahead.
Hi, good afternoon. Thanks for taking me in. Just two quick ones for me. Firstly, can you remind us with respect to the cyber-attack, have you received your insurance payment for that? If so, is it booked in FY 2021, or is that something to come in 2022?
And then my second question, just in Flavors. Can you just talk a bit about the growth expectation by the categories, say, beverages, savory, sweet, dairy? Is there any significant variance in growth you're expecting in 2022 across that division? Thank you.
Okay. Olaf, you may want to handle the cyber thing, and I handle this growth expectation by flavors. You start?
So on cyber, the reimbursement is expected this year and there's nothing in the books yet.
Okay. That was precise, crisp and short. So I am talking flavors. So from what we see now, we expect a continuous healthy momentum in beverages. And we think with the acquisitions we have done recently, we will also continue to benefit in culinary/savory. Having said that, that is by categories and categories to highlight the areas of growth. We see a strong momentum in Asia going in the past. And this, we expect to go on. So by regions, I would stress Asia, we expect most dynamics and, in particular, in the categories, beverages and culinary, okay?
That's great. Thank you. And Olaf, are you able to give any sort of size guidance on that insurance payout, and will it go into your core numbers or adjusted it for your GAAP numbers? Thank you.
Again, it's not in the guidance, and therefore, I think let's wait for the outcome, and I will inform you, of course, once we have clarity on this.
All Right. Thank you.
Okay.
Thank you. Dear participants, this brings us to the end of our today's conference call. I know that you are all very busy today with so many companies presenting results. So we are thankful for your time today and your ongoing interest in Symrise. We are looking forward to seeing you in the upcoming virtual conferences and virtual roadshows. And above all, we hope to see you in-person soon. We will publish our trading update for the first quarter on April 27. That's it for today. So thank you very much. Good-bye, and have a nice day.
We want to thank all the participants of this conference. Thank you. Good-bye.