(Adds analyst comment, shares, details)
ZURICH Oct 10 Givaudan's chairman and
finance chief will stand down next year, the Swiss fragrance and
flavour maker said on Monday while reporting slower
like-for-like sales growth in the third quarter of 2016.
Geneva-based Givaudan, which makes fragrances for perfumes
and toothpaste and flavours for food and beverages, posted
third-quarter sales of 1.184 billion Swiss francs ($1.21
Like-for-like sales growth from July to September was 3.1
percent, half the 6.2 percent growth rate seen in the first half
and short of a forecast for 3.4 percent in a Reuters poll of
Analysts had expected a slowdown in sales growth due to a
strong year-ago performance and an erosion of forex-driven price
increases which had boosted its Latin America business.
"However, the reversal of the U.S. dollar pricing proved to
be more acute than we had anticipated," Kepler Cheuvreux analyst
Aymeric Poulain, who has a "hold" rating on the stock, wrote in
a note to investors.
"This is likely to remain a top-line growth drag over the
next few quarters and could cap earnings estimates for now,
while putting pressure on the higher end of consensus."
Givaudan shares fell 1.7 percent in early trading, lagging a
0.5 percent fall in the Swiss blue-chip index.
Givaudan confirmed its mid-term targets of 4-5 percent sales
growth and a free cash flow of 12-17 percent of sales.
Third-quarter sales at its fragrances division, which
creates scents for Dior and Bottega Veneta, rose 3.4 percent to
567 million francs, while sales at the flavours division, whose
products are used by food groups like Nestle and Danone
, were up 2.9 percent at 617 million francs.
Givaudan has been seeking to compensate for a weaker trading
environment in western Europe and North America by winning new
contracts from food companies in faster-growing regions like
South America and Asia.
Givaudan said Chairman Juerg Witmer will retire in March
2017 with Calvin Grieder proposed for election as his
Chief Financial Officer Matthias Waehren will also retire at
the end of 2016 and Tom Hallam, head of group controlling and
business development, will take over as CFO from Jan. 1,
($1 = 0.9768 Swiss francs)
(Reporting by Joshua Franklin, editing by John Miller)