Investing.com -- Givaudan (SIX:GIVN) beat 2024 sales expectations, with strong growth across all divisions and regions.
The company's organic sales growth in the fourth quarter stood at 10.1%, exceeding the consensus estimate of 8.4%.
This growth was driven primarily by volume increases and solid performances in key segments, particularly Fine Fragrance.
The Taste & Wellbeing division achieved a 10.5% growth in Q4 organic sales growth, while Fragrance & Beauty posted a 9.7% increase.
Within the latter, Fine Fragrance posted a 20% growth in Q4, cementing its status as a standout contributor.
In contrast, the Consumer Products fragrance segment experienced a slowdown, registering 6% growth in Q4 compared to its exceptional performance earlier in 2024.
Barclays (LON:BARC) noted that challenging year-over-year comparisons likely played a role in this deceleration.
Despite concerns about the Consumer Products segment's trajectory, Givaudan has provided reassurances about the start of 2025, reporting no significant changes in trading conditions and a "good start" to January.
This guidance may help address market apprehensions about potential difficulties in sustaining growth after a strong 2024.
On profitability, Givaudan's full-year adjusted EBITDA margin for 2024 was 24.5%, slightly surpassing the consensus estimate of 24.3%. Margins in the Taste & Wellbeing division exceeded expectations, while those in Fragrance & Beauty were marginally below forecasts.
The 2024 margin exceeded the company's 22-24% target, demonstrating resilience amid rising input costs.
To maintain margins in 2025, a 2% price increase may be necessary, given the estimated 4% raw material inflation.
Givaudan's 2024 net income was slightly below expectations due to a higher tax rate. However, its organic sales growth remained strong. The company anticipates an average organic sales growth of 7.2% for 2021-2024, surpassing its 4-5% target for 2021-2025.
Despite recognizing these achievements, Barclays analysts expressed concerns about the sustainability of these growth rates into 2025.