Givaudan reported organic sales growth of 8.6% in the third quarter, almost twice the 4.7% analysts had expected, as demand for luxury perfume materials lifted its fragrance business.
The Swiss maker of fragrances, flavours and active cosmetic ingredients said Fragrance & Beauty generated CHF 3.15 billion (US$3.78 billion) in the first nine months, up 8.8% on a like-for-like (LFL) basis and ahead of the 8% growth recorded in the same period a year earlier. The division accounted for roughly 53% of group sales in that period.
In the third quarter alone, Fragrance & Beauty sales reached CHF 1.14 billion (US$1.37 billion), with LFL growth of 13.5%, up from 6.8% in the comparable quarter of the prior year. Group sales for the first three quarters totalled CHF 5.89 billion (US$7.08 billion).
Fine fragrance leads
Fine Fragrance sales rose 15.3% LFL, building on a competitive prior-year comparable of 18.7%. Givaudan said the back-to-back double-digit growth points to continued resilience in that business and strong demand across the premium perfume market.
Consumer Products sales increased 9.3% LFL against 5.9% a year earlier, which the company said shows fragrance demand extending beyond fine perfumery into personal, oral, home and fabric care.
By contrast, the combined Fragrance Ingredients and Active Beauty businesses declined 2.5% LFL, compared with growth of 1.5% in the first nine months of the prior year.
Acquisitions and currency
LFL figures exclude acquisitions. On a reported basis, acquisitions added 2.8 percentage points to Fragrance & Beauty growth over the nine months, while currency translation subtracted 3.8 points. At group level, acquisitions contributed 1.4%. Givaudan highlighted two transactions: Belle Aire Creations for CHF 62 million (US$74.48 million) and Vollmens Fragrances for CHF 20 million (US$24 million).
Geography
Asia Pacific was the fastest-growing region, with first-nine-month sales up 10.6% LFL, against 4.6% a year earlier. South Asia, Africa and the Middle East grew 4.1% LFL, down from 8.8%. Europe rose 1.5% LFL versus 3.8%, and Latin America 1.1% versus 3.1%. High-growth markets increased 7.9%, compared with 2.7% in mature markets.
North America was the weakest region, with Taste & Wellbeing LFL sales down 3.3% against 3.9% in the year-earlier period, although the region overall grew 1.1%. Givaudan attributed the decline chiefly to continued weakness in its Health and Functional business unit and to US tariff refunds made to customers in the third quarter.
Market reaction
The update lifted Givaudan shares by nearly 7% to a 15-month high, Reuters reported. Peers including dsm-firmenich, Novonesis and Symrise rose between 1.6% and 3.1% in early trading.
Vontobel analyst Arben Hasanaj said the acceleration should reinforce confidence in Givaudan's growth profile and resilience, according to Reuters. Vontobel and Jefferies estimated Fine Fragrance sales grew around 31% organically in the third quarter.
Givaudan said the figures were achieved despite geopolitical and macroeconomic volatility, which it described as evidence of market resilience. The results indicate continued opportunities in fine fragrance, fragrance ingredient differentiation and premiumisation.