Novozymes posts solid results

Danish biotechnology company Novozymes has published its third quarter results, revealing better than expected growth from the company, including a strong showing from its “Bioenergy” division.

Earnings before interest tax  (EBIT)increased by 5% to DKK 3,032 million (€407m) , up from DKK 2,884 million from the first nine  months of 2016, and the EBIT margin at 27.9% was slightly higher than the 27.7% reported for the same period last year.

Net financial costs were DKK 116 million in the first nine months of 2017, compared with a net financial gain of DKK 5 million in the same period last year. Net financial costs were impacted by a write-down of a financial asset of DKK 60 million in the third quarter.

Profit before tax was DKK 2,908 million, 2% higher than the DKK 2,860 million recognised in the first nine months of 2016.

Bioenergy sales grew by 10% both organically and in DKK compared with the first nine months of 2016. In Q3 year-on-year, organic growth stood at 16% and 10% in DKK. Bioenergy sales continued to build on the positive momentum seen in the first half. Sales for US conventional biofuels benefited from growth in the production of ethanol, which is estimated to have increased by around 2% in the first nine months year-on-year (Q3 year-on-year flat).

Other geographies continue to show good growth but represent a smaller part of overall Bioenergy sales. Novozymes’ broad product portfolio combined with a strong focus on tailoring process-specific solutions are the main reasons for the good performance in the first nine months. Sales of enzymes for biomass conversion continued to contribute to Bioenergy sales growth in the first nine months, but make up a small proportion of Bioenergy sales.

‘Decarbonisation of road transport’

Tina Sejersgård Fanø , Novozymes’ executive VP at Agriculture & Bioenergy, said: “I am pleased to see good development in Novozymes’ Bioenergy business. With 16% organic growth in the third quarter, we are achieving a very satisfying 10% for the first nine months.

“Supporting the much needed decarbonisation of road transport, growth came mainly from conventional biofuels – and across geographies.

“Our tailored customer approach helps our performance; it is made possible by Novozymes’ broad portfolio of innovative enzymes, so the launches of previous years are really paying off – both in the case of the U.S. and other parts of the world.

“All in all, a good first nine months in Novozymes Bioenergy, supported by volume growth, tailored technical solutions and a broad, innovative enzyme product range. Innovation and closeness to our customers are really key to continuing to deliver growth for the future.”