Fragrance giant Symrise rethinks growth path for 2025
The Germany-based group, whose fragrances are used in perfumes by French luxury majors LVMH and Kering, now expects organic sales growth of 3% to 5% for the year, down from its previous forecast of 5% to 7%. It maintained its projected core profit (EBITDA) margin at around 21.5%, slightly above the original guidance of 21%.
'We are observing a shift in global market demand, with heightened consumer caution across certain sectors,' said Jean-Yves Parisot, chief executive officer of Symrise. He added that internal 'self-help initiatives' were expected to support margin improvements.
The company aims to reach recurring cost savings of 40 million euros ($46.2 million) in 2025 through operational efficiency efforts, of which 20 million euros had already been achieved in the first half of the year, it said.
Revenue for the January–June period fell 0.5% on a reported basis to 2.55 billion euros, below analyst expectations of 2.60 billion euros, according to a Vara Research poll. However, organic sales — which exclude currency exchange effects — rose 3.1% during the same period.
Swiss competitor Givaudan also reported weaker-than-expected organic sales growth last week, highlighting broader concerns over softening demand in the sector.
'U.S. demand has simply weakened over the past few months,' said Olaf Klinger, chief financial officer at Symrise, during a conference call. He noted that the pet nutrition and UV filter categories were among the most affected.
On the subject of U.S. tariffs, Klinger said the company had already implemented price increases in select cases and was prepared with additional mitigation strategies.
'We have the opportunity to relocate products if the tariff situation does not allow continued delivery from certain regions,' he said. 'We also have reformulation options, meaning sourcing raw materials from other regions to ultimately manage tariff situations.'
($1 = 0.8656 euros)
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