|Tjerk de Ruiter, CEO of Corbion|
“Our profitability increased substantially driven by a combination of business mix improvements, cost savings and lower input costs,” said Tjerk de Ruiter, CEO of Amsterdam-based Corbion, when results were given Oct. 21. “However our top-line growth in Q3 was clearly below our ambition level.”
In bakery, sales decreased in a stable US bread market. Closing a Kansas plant in the second quarter decreased the number of stock-keeping units and moved smaller customers to an indirect delivery model, which negatively impacted Corbion volumes.
Companywide, EBITDA excluding one-off items of €134.8 million over the first nine months marked an organic increase of 16 percent from €117.1 million in the same time period of the previous year. Net sales of €685.2 million marked an organic decrease of 0.2 percent from €687.9 million.
“We anticipate these effects to be of a temporary nature and remain confident that we will achieve our multi-year guidance,” he said.
In Corbion’s Biobased Ingredients, EBITDA excluding one-off items was €137.6 million, which was up 15 percent from €119.8 million. Net sales of €667.7 million were down 1% from €674.6 million. Food, biochemicals and central costs decreased organically by 0.8 percent over the nine-month period. Corbion expects full-year growth in the food business segment to end up below the multi-year (2015-18 compound annual growth rate) guidance range of 1 to 3 percent.
Within Biobased Ingredients, the food business segment, which includes bakery, saw net sales drop 2.2 percent to €507.1 million from €518.3 million while EBITDA excluding one-off items was €110.3 million, up 11 percent from €99.4 million. The egg situation in 2016, as compared to 2015, had a negative effect on the bakery segment.
“Mid-2015 we were able to accommodate a surge in demand for higher priced egg-containing products due to an outbreak of avian flu in the US,” Corbion said. “A reversal of these effects has put additional pressure on both volumes and price/mix, particularly in Q3.”
Also within Biobased Ingredients, the biochemical business segment turned in EBITDA excluding one-off items of €41.5 million, up 18 percent, and net sales of €160.6 million, up 2.8 percent. Volume growth related to lactide/polylactic acid (PLA) drove the sales increase.
Corbion’s Biobased Innovations reported a loss before interest, taxes, depreciation and amortization, excluding one-off items, of €2.8 million, which compared to a loss of €2.7 million in the first nine months of the previous year. Net sales of €17.5 million were up 32 percent from €13.3 million.