Novonesis (NSIS) Q3 2024 earnings summary

Executive summary

• Achieved 9% organic sales growth in the first nine months of 2024, with 11% in Q3, driven by strong demand, innovation, and volume growth across divisions.

• Launched 29 new solutions in the first nine months, reflecting strong innovation momentum in areas such as energy, laundry care, and postbiotics.

• Integration and synergy realization progressing well, with 80% run rate on cost synergies and initial sales synergies expected from 2025.

• Merger with Chr. Hansen effective January 29, 2024, impacts comparability of reported figures.

• Strong execution and realization of cost synergies have supported performance.

Financial highlights

• Organic sales growth for the full year now expected at the upper end of the 7%-8% range, mainly volume-driven.

• Adjusted EBITDA margin guidance confirmed at 35.5%-36.5%.

• 9M 2024 sales: EUR 2,964.1m, up from EUR 2,801.2m in 9M 2023; Q3 2024 sales: EUR 1,020.4m, up from EUR 943.0m in Q3 2023.

• Special items for 2024: EUR 190m, including integration, transaction, and Russia discontinuation costs.

• Without the hyperinflation cap, organic sales growth would have been about 3 percentage points higher.

Outlook and guidance

• Full-year organic pro forma sales growth expected at the higher end of 7%-8%, with both main business segments/divisions anticipated to deliver growth at group level.

• Adjusted EBITDA margin to benefit from pricing, productivity, and cost synergies.

• Growth synergies from integration expected to contribute starting in 2025.

• CAPEX/Sales expected at 9-11%; net debt/EBITDA at -1.5x; effective tax rate expected at ~30%.

• Second half of 2024 expected to show stronger growth than the first half.