April 10, 2018 / 5:40 AM / 10 days ago

UPDATE 1-Givaudan Q1 sales miss estimates, confirms targets

(Recasts with details and background)

ZURICH, April 10 (Reuters) - Fragrance and flavour maker Givaudan reported a weaker-than-expected sales increase during its first quarter on Tuesday despite a boost from new contract wins and acquisitions.

Sales rose 5.4 percent to 1.308 billion Swiss francs ($1.37 billion) for the three months to the end of March, short of the average analyst expectation of 1.335 billion Swiss francs in a Reuters poll.

Its like-for-like sales figure, which strips out the impact of acquisitions and currency movements, increased by 5 percent, also lagging expectations for a 5.6 percent increase.

Still, Givaudan said it had made a good start to the year, with growth coming in both its flavours and fragrance businesses and in all regions.

“Givaudan started the year with good business momentum and with the project pipeline and win rates being sustained at a high level,” the company, which makes flavours for food and drinks and fragrances for perfume and washing powder, said in a statement.

The flavours business increased sales by 4.5 percent on a like-for-like basis, while fragrances increased by 5.7 percent, helped by a strong performance from its fine fragrance business which makes perfume for Dior and Prada. The company does not publish profit figures for its first quarter.

Givaudan has made several acquisitions to widen its footprint in natural ingredients and is implementing price increases to compensate for higher input costs.

Givaudan confirmed its mid-term targets that include 4-5 percent sales growth on average over a five-year period.

The Geneva-based company last month said it was planning to launch an offer for French natural ingredients group Naturex after agreeing to buy a half-billion euro minority stake in the firm.

$1 = 0.9567 Swiss francs Reporting by John Revill; Editing by Michael Shields

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