DSM achieves sales of EUR 4.5 billion in the first half of 2021

On August 3, DSM disclosed its performance report for the first half of 2021
.
Company sales reached 4.
5 billion euros, 100 million euros more than analysts had expected and a 10 percent increase compared to the first six months of 2020
.
Adjusted operating profit (EBITDA) rose by 22 percent to EUR 925 million
.

The food division's turnover rose steadily by 6 percent to 3.
4 billion euros
.
In the Materials business, DSM noted a clear increase in demand from the industry, with sales up by a third to EUR 971 million and adjusted operating profit of EUR 235 million, 86% higher than in the first half of 2020
.

Co-CEO Statement

Co-CEOs Geraldine Matchett and Dimitri de Vreeze commented: "Our strong start to the year continues the continued positive momentum
in our Nutrition business.
Materials have seen a strong recovery, supported by continued supply chain replenishment.
Strong
materials side The performance, coupled with our optimistic outlook for nutrition remaining unchanged, allowed us to further improve the Group's full-year outlook
.

"We achieved these results while making good progress on our long-term strategic priorities and realigning our organization following last year's acquisition of Nutraceuticals and divestiture of resins and functional materials
.
In building our innovation-focused Good progress was also made on the business side of the growth platform, including the launch of several new initiatives in personalised and precision nutrition
.

"As a goal-driven company, we continually seek to maximize our positive impact on all stakeholders
.
Today, we have increased our 2030 Scope 1 and 2 emissions reduction target from 30% to 50%, This further accelerates the target of net-zero emissions by 2050%, independently verified by the Science-Based Targets initiative
.
"

Outlook 2021

For the full year, DSM continues to expect adjusted EBITDA growth for nutritionals to be at the upper end of its medium-term strategic target of high single-digit growth
.
Coupled with a stronger performance on the materials side than forecast in the Q1 2021 transaction update, DSM now expects the group's adjusted EBITDA growth rate to be around 15 years old and adjusted net operating free cash flow to continue to be good
.

strategy

DSM's purpose-driven, performance-driven strategy sees sustainability and innovation as key growth drivers for long-term focused plans, underpinned by ambitious goals that span people, planet and profit
.
In markets related to nutrition, health and sustainable living, DSM is well-positioned to leverage its capabilities to create positive impact and create value for all stakeholders
.

In nutrition, DSM sees huge scope for further growth and innovation
.
The track record of 6% organic sales growth and 10% adjusted EBITDA growth in 2015-2020 is testament to the success of its unique business model combining "global products" and "local solutions"
.

Nutrition will continue to grow by building on this business model and capturing emerging big data, digital and bioscience capabilities by adding a third dimension of precision and personalization
.
For example, in the first half of this year, DSM launched Sustell™, a data-driven sustainability service that helps drive improvements to the environmental footprint and economics of animal farming
.
It also created Hologram Sciences, a consumer-facing company that provides people with holistic solutions for managing their health by combining health diagnostics, digital coaching and personalized nutrition
.

In materials, DSM has strong growth and profitability potential and is well-positioned in the strategic area of ​​sustainable living
.
Following the completion of the sale of the Resins and Functional Materials business to Covestro AG, the Materials business now includes DSM Engineered Materials and DSM Protective Materials
.
The company will continue to develop these into a resilient, higher growth and highly profitable specialty business
.
Its products meet the growing demand for materials that protect the health of people and the planet by adding more bio-based and circular solutions
.

Overall, DSM is targeting mid-single-digit organic sales growth, an adjusted EBITDA margin in excess of 20%, and a high-single-digit adjusted EBITDA percentage growth in Nutrition and Materials, benefiting from the due to its strong innovation pipeline.

Recent acquisitions and sales

On March 31, 2021, DSM acquired the Flavors and Fragrances Bio-based Intermediates business of Amyris, Inc.
, expanding its offerings in personal care and fragrance ingredients
.
The transaction includes an initial consideration of $150 million and profit-related gains expected to be in the range of $100-150 million for the period 2021-2024
.

On April 1, 2021, DSM completed the sale of DSM's resins and functional materials business, including DSM Niaga®, DSM Additive Manufacturing and DSM Advanced Solar's coatings business, to Coase Created transactions
.
DSM received net cash of around 1.
4 billion euros and a net book profit of 567 million euros
.
DSM's remaining solar backsheet business was sold to Worthen Industries, Inc.
on June 1, 2021
.

Events after the reporting period

On July 13, 2021, CVC Partners announced its proposed sale of AOC, in which DSM has a minority stake, to an affiliate of Lone Star Funds
.
It is estimated that after the deal closes, DSM will receive about 300 million euros in cash for its holdings
.

On July 27, 2021, DSM acquired full ownership of Midori USA Inc.
, a biotechnology company developing a new generation of prebiotics for animal health
.
DSM already owns 38.
5% of Midori and has acquired the remaining 61.
5% for $63 million
.

Sustainability

DSM's commitment to creating value for all stakeholders is fully rooted in its long-term, purpose-driven, performance-driven strategy
.
By focusing on the development and application of scientific innovations, DSM aims to enable its customers to positively impact the health of people today and the health of the planet for future generations
.
This is due to DSM's own operational improvements, reducing emissions and increasing the use of renewable energy, continuously improving safety standards and promoting the health and well-being of employees
.

During the first half of 2021, DSM made significant progress in improving its environmental impact
.
DSM is now well-positioned to exceed its target for renewable electricity purchases in particular
.
Building on the company-wide energy transition in recent years, after the DSM Protective Materials plant in Laiwu, China switched this year, all plants worldwide now run on 100% renewable electricity
.
DSM signed an additional power purchase agreement in July 2021, which means all of its North American electricity needs will be 100% renewable this year
.
At the same time, DSM exceeded its energy efficiency improvement goals with on-site initiatives such as the installation of new chillers in Xinghuo, China, and the introduction of heat recovery systems and energy dashboards
.

DSM today announced a significant increase in its greenhouse gas (GHG) reduction targets
.
DSM now aims to halve its 2016 Scope 1 and Scope 2 emissions by 2030, reducing its target from 30% to 50%
.
The updated GHG targets, which have been reviewed and approved by the Science Targets programme, provide DSM with a solid foundation and mid-term to achieve net-zero emissions by 2050, ensuring it can meet this long-term goal
.

DSM's long-standing priority remains the safety, health and well-being of people
.
The company continued to take proactive steps to support employees and their families in the first half of 2021, distributing millions of free doses of immune-optimized micronutrients and providing homework equipment, distance learning and development, and assistance programs globally
.
Despite the ongoing personal challenges many face in the context of the global pandemic, employee engagement remains good
.
DSM has also strengthened its broad inclusion and diversity efforts, supported a motivated Employee Resource Group, and increased the representation of women at senior levels in the first half of 2021
.
DSM's measure of recordable safety incidents remains low, and the company strives to be accident- and injury-free.

Products and services that DSM believes have a better environmental and/or social impact than mainstream alternatives on the market are measured and reported as Better Living Solutions
.
By constantly reviewing its product portfolio, launching new innovations and improving its footprint, DSM aims to maintain a high level of positive impact through its product portfolio
.
DSM will ensure that its approach will allow for reporting on new and future requirements from regulators and create transparency in mapping the impact of DSM sales on the achievement of the UN Sustainable Development Goals
.
DSM is committed to continuing to obtain reasonable assurance for its impact reporting
.