12019 Half Year Report
Excellent sales growth
On track to deliver2020 guidance

Givaudan – 2019 Half Year Report2

Our profile

Givaudan captures theessence of the moment,
bringing you memorable
fragrances and flavours
to be enjoyed throughout
the day.
We are proud to be the industry leader, withapproximately 25% of market share of thefragrance and flavour industry. To stay infront, we challenge ourselves daily, inspire
our partnerships across the globe, and serve
our customers with heart and soul.
Together with our customers in the food,beverage, consumer goods and fragrance andcosmetics industries, we create products thatdelight consumers the world over. With apassion to understand consumer preferences
and a relentless drive to innovate, we are at
the forefront of creating scents and tastes
that touch consumers’ emotions.

Table of contents

Givaudan – 2019 Half Year Report03

At a glance

05

Business performance

07

Flavour Division

08

Fragrance Division09

Half Year Financial Report3 - At a glance

At a glanceFirst half of 2019
Key Figures
2019

2018

PercentagechangeGroup sales

3,094

2,674

15.7%

Fragrance sales

1,361

1,223

11.3%

Flavour sales

1,733

1,451

19.4%

Like-for-like sales growth

6.3%

5.6%

For the six months ended 30 June, in millions of Swiss francs, except for earnings per share data

Gross profit

1,274

1,182

as % of sales

41.2%

44.2%

EBITDA a

660

601

as % of sales

21.3%

22.5%

Operating income
as % of sales
Income attributable to equity holders of the parent
as % of sales

491

489

15.9%

18.3%

380

371

12.3%

13.9%

Operating cash flow b

271

269

as % of sales

8.8%

10.1%

Free cash flow

148

113

as % of sales

4.8%

4.2%

Earnings per share − basic (CHF)

41.24

40.26

7.8%
9.9%
0.4%
2.3%
0.7%
31.0%
2.4%

a)	EBITDA defined as Earnings before interest (and other financial income (expense), net), Tax, Depreciation and Amortisation, corresponds to operating income before
depreciation, amortisation and impairment of long-lived assets.
b) Free Cash Flow refers to operating cash flow after net investments, interest paid and lease payments.

Sales performance from January to June
2018
Sales
as reported

like-for-likedevelopment

Group

2,674

169

2,843

- Fragrance

1,223

105

1,328

- Flavour

1,451

64

1,515

in millions of Swiss francs

2019
Change %Sales on like-for-like
like-for-like
basis

2019
Sales
Change %as reported in Swiss francs

Acquisition
impactCurrency
effects

6.3%

284

(33)

3,094

15.7%

8.6%

50c

(17)

1,361

11.3%

4.4%

234

(16)

1,733

19.4%

c) The acquisition impact for the Fragrance Division includes CHF 39 million of sales for Expressions Parfumées, which was acquired and included in the Givaudan results asfrom June 2018.

Sales evolution by market – January to Junein millions of Swiss francs

2018
Sales
as reported

like-for-likedevelopment

2019
Change %Sales on like-for-like
like-for-likebasis

Acquisition
impactCurrency
effects

2019
Sales
Change %as reported in Swiss francs

Mature markets

1,531

54

1,585

3.5%

215

2

1,802

17.8%

High growth markets

1,143

115

1,258

10.0%

69

-35

1,292

13.0%

Note: Like-for-like (LFL) is defined as: (a) sales calculated using the invoicing exchange rates of the prior year, and (b) excluding sales of businesses acquired from theacquisition date until the period end date, up to 12 months from the acquisition date.

Givaudan – 2019 Half Year Report4 - At a glance

At a glance
Key indicators“Our strong performance for the first half of 2019 confirms theresilience of our business and our ability to consistently deliverindustry leading financial performance. I am very pleased with our
results and with the continued progress we have made in delivering
against our strategic goals under the 2020 strategy.”
Gilles Andrier, CEO

Growth Drivers:- Excellent growth in the Fragrance Division- Sales growth from Expressions Parfumées, acquired in 2018, was particularly strong- Sales in Naturals contributing to the strong results in the Flavour Division- Double-digit growth across Latin America in the Flavour Division

Building on our capabilities:- Expanding our capabilities in natural fragrance ingredients and aromatherapy with the acquisitionof Albert Vieille- Announced acquisition of Vietnamese Flavour Company Golden Frog to provide customers withnatural solutions- Strengthening Active Beauty’s global capabilities in sustainable biopolymers with the acquisitionof AMSilk

Driving innovation:− Our Digital Factory in Paris enables us to accelerate digital transformation and anticipate trends− Strengthening our global innovation ecosystem with the newly opened Innovation Centre in Zurich− Our new fragrance encapsulation centre in Singapore enhances our encapsulation technology for
the Asia Pacific market− The launch of ‘Carto’, the Artificial Intelligence powered tool, redefines the rules of Fragrance creation

Givaudan – 2019 Half Year Report5 - Business performance - Group

Business performance
Excellent sales growthBusiness performance

Givaudan Group sales for the first six months of the year were
CHF 3,094 million, an increase of 6.3% on a like-for-like basis
and 15.7% in Swiss francs.
Fragrance Division sales were CHF 1,361 million, an increase of
8.6% on a like-for-like basis and 11.3% in Swiss francs. Flavour
Division sales were CHF 1,733 million, an increase of 4.4% on a
like-for-like basis and 19.4% in Swiss francs.
Givaudan continued the year with good business momentum
and with the project pipeline and win rates being sustained at ahigh level. This excellent growth was achieved across all
product segments and geographies, with our key strategic
focus areas of Naturals, Health and well-being, Active Beauty,
Integrated solutions and local and regional customers
delivering strong growth, complemented by the recent
acquisitions.
The Company continues to implement price increases incollaboration with its customers to compensate for theincreases in input costs.
Group sales
in millions of Swiss francs

In 2019, the Group incurred costs of CHF 19 million in relation to
the implementation of the Givaudan Business Solutionsorganisation, compared with CHF 25 million in 2018.
Group EBITDA
in millions of Swiss francs
2019

660

2018

601

2017

597

2016

638

2015

566

Operating income

The operating income was stable at CHF 491 million, comparedto CHF 489 million in 2018. When measured in local currency
terms, the operating income increased by 2.3%. The operating
margin decreased to 15.9% in 2019 from 18.3% in 2018.
Group operating income
in millions of Swiss francs
2019

491

3,094

2018

489

2018

2,674

2017

489

2017

2,483

2016

500

2016

2,334

2015

428

2015

2,184

2019

Gross profit

The gross profit increased by 7.8% from CHF 1,182 million in 2018
to CHF 1,274 million in 2019. Despite continued productivity
gains and cost discipline, the gross margin declined to 41.2% in2019 compared to 44.2% in 2018. This was mainly due to theimpact of higher input costs and the lower margin of Naturex.

Earnings Before Interest, Tax, Depreciation
and Amortisation (EBITDA)

The EBITDA increased by 9.9% to CHF 660 million from CHF 601
million for the same period in 2018, whilst the EBITDA margin
was 21.3% in 2019 compared to 22.5% in 2018. On a comparable
basis, the EBITDA margin was 22.3% in 2019 compared to 23.4%
in 2018.

Givaudan – 2019 Half Year Report

Financial performance

Financing costs were CHF 36 million in the first half of 2019,
versus CHF 23 million for the same period in 2018, largely related
to the increase in net debt of the Group in connection with the
Naturex acquisition. Other financial expense, net of income, was
CHF 18 million in 2019 versus CHF 35 million in 2018. As a reminder,in 2018 the Group incurred increased foreign exchange losses inmarkets where currencies could not be hedged.
The interim period income tax expense as a percentage of income
before taxes was 13% in 2019, compared with 14% for the same
period in 2018.

Net income

The net income for the first six months of 2019 was CHF 380
million compared to CHF 371 million in 2018, an increase of 2.3%,
resulting in a net profit margin of 12.3% versus 13.9% in 2018.
Basic earnings per share were CHF 41.24 versus CHF 40.26 forthe same period in 2018.

6 - Business performance - Group

Cash flow

In the first six months of 2019, the Group incurred costs of
CHF 19 million in relation to the implementation of theGivaudan Business Solutions organisation, compared with
CHF 25 million in the same period in 2018.

Net Working capital was relatively stable at 27.3% of sales
compared to 28.7% in 2018.

Naturex

Givaudan delivered an operating cash flow of CHF 271 million
for the first six months of 2019, compared to CHF 269 million
in 2018.

Total net investments in property, plant and equipment were
CHF 77 million, compared to CHF 122 million in 2018, as theGroup continues to invest in expanding its capabilities in highgrowth markets. In 2018 the Group completed an agreement tosell and leaseback the Zurich Innovation Centre for a total
consideration of CHF 173 million, of which CHF 100 million wasreceived in 2018 and CHF 60 million was received in the first six
months of 2019, with the balance to be received in the second
half of 2019.
Intangible asset additions were CHF 17 million in 2019,
compared to CHF 21 million in 2018, as the Company continues
to invest in its IT platform capabilities, including those tosupport the introduction of the Givaudan Business Solutionsorganisation.
Total net investments in tangible and intangible assets were3.0% of sales, compared to 5.3% in 2018. Excluding the impact of
the ZIC transaction, total net investments in tangible andintangible assets would have been 4.6% of sales.
Operating cash flow after net investments was CHF 177 million
versus CHF 126 million recorded in 2018, an increase of 40%.
Free cash flow was CHF 148 million in the first half of 2019,
versus CHF 113 million for the comparable period in 2018, an
increase of 31%. As a percentage of sales, free cash flow in thefirst six months of 2019 was 4.8%, compared to 4.2% in 2018.

Financial position

Givaudan’s financial position remained solid at the end of June
2019. Net debt at June 2019 was CHF 3,710 million, up from
CHF 2,847 million at December 2018, with the increase driven by
the adoption of IFRS 16, as well as the payment of the annual
dividend of CHF 552 million in the first quarter of 2019. The
leverage ratio was 49% compared to 41% at the end of 2018.

Givaudan Business Solutions

The Company is now well advanced in the implementation ofGivaudan Business Solutions (GBS), a global organisational
unit providing best-in-class internal processes and services.

Givaudan completed the acquisition of Naturex in September
2018 and has consolidated the financial results of Naturex
from 1 September 2018. Naturex is an international leader inplant extraction and the development of natural ingredientsand solutions for the food, health and beauty sectors.
In the first six months of 2019, Naturex contributed CHF 235
million of sales, CHF 229 million in the Flavour Division and
CHF 6 million in the Fragrance Division. The integration of
Naturex into Givaudan is progressing as planned and thebusiness of Naturex has returned to growth in the first six
months of 2019, compared to the same period in 2018.
Givaudan aims to achieve sales growth of the Naturex
portfolio of 10% per annum from 2021 and at the same time
return the profitability and other key financial indicators of
the combined business to pre-acquisition levels by 2021 for
the Flavour Division.

2020 guidance:
Responsible growth. Shared success

The Company’s 2020 ambition is to create further value
through profitable, responsible growth. Building on the first
three years of this strategic cycle, Givaudan’s 2020 ambition isdefined around the three strategic pillars of ‘Growing withour customers’, ‘Delivering with excellence’ and ‘Partnering
for shared success’.
As part of the Company’s 2020 strategy, Givaudan also seeks
to create value through targeted acquisitions, which
complement existing capabilities in providing winningsolutions for its customers. Since 2014 Givaudan has
announced eleven acquisitions, which are fully in line with thegrowth pillars within the Company’s 2020 strategy.
Ambitious financial targets are a fundamental part ofGivaudan’s strategy. We aim to outpace the market with 4-5%
sales growth and a free cash flow of 12-17% of sales, bothmeasured as an average over the five-year period of ourstrategy cycle. It is Givaudan’s intention to maintain its
current dividend practice as part of this ambition.

The progressive implementation of GBS is fully in line with theplan and the new organisation continues to deliver theforeseen financial benefits.
Note: Definitions and further information and reconciliations of the Group’s
Alternative Performance Measures can be found in the Appendix ‘Alternative
Performance Measures’ pages 23-24.

Givaudan – 2019 Half Year Report7 - Business performance: - Flavour Division

Flavour Division
Flavour sales

Flavour Division sales were CHF 1,733 million, an increase of
4.4% on a like-for-like basis and 19.4% in Swiss francs. The salesof the Flavour Division include CHF 229 million from Naturex,
acquired in September 2018.

Flavour Division sales
in millions of Swiss francs
2019

1,733

2018

1,451

The sales performance was driven by new wins and strong
business momentum across all regions. The key strategic focus
areas of the 2020 strategy, namely Health and well-being andNaturals grew at double-digit and single-digit levels
respectively.

2017

1,346

2016

1,202

2015

1,161

From a segment perspective, Beverages, Sweet Goods, Savoury
and Snacks were main contributors to the division’s growth.

In the mature markets of Western Europe, double-digit
growth was achieved in Spain and Portugal and goodsingle-digit growth in the UK, Italy and Switzerland. Therewas good growth in Beverages and Sweet Goods segments.

The EBITDA increased to CHF 390 million from CHF 351 million
in 2018, an increase of 11.1%, with continuing productivity gains
and cost discipline contributing to the increase. The EBITDA
margin was 22.5% in 2019, down from 24.2% in 2018, largely due
to the impact of the lower margin on the acquired Naturex
business. On a comparable basis the EBITDA margin of the
Flavour Division was 23.1% in 2019 compared to 24.2% in 2018.
The operating income decreased to CHF 278 million in 2019from CHF 286 million in 2018, a decrease of 3.0%. The operating
margin was 16.0% in 2019 compared to 19.7% in 2018.

Asia Pacific

Sales in Asia Pacific grew by 6.2% on a like-for-like basis. In
the high growth markets, Indonesia, Malaysia, Philippines
and Vietnam delivered double-digit performance, whilst
India delivered a strong single-digit increase. Sales growthin China was solid against a high prior year comparable.
In the mature markets, growth was driven by good
performance in Japan, Korea and Australia. Local and regionalcustomers continued to grow across the region, whilst froma segment perspective, Beverages and Savoury contributed
significantly to the growth.

Europe, Africa and Middle East

Sales in Europe, Africa and Middle East increased by 2.8% on
a like-for-like basis. In the high- growth markets of Africa
and the Middle East, double-digit growth was achieved in
Maghreb, Egypt and South Africa followed by the Middle Eastwith strong single-digit growth. Growth in Central andEastern Europe was led by Poland, Bulgaria and Czech
Republic partially offset by a high comparable from last year
in Russia and the economic situation in Turkey.

Givaudan – 2019 Half Year Report

North America

On a like-for-like basis, sales in North America decreased by
1.0% despite the good performance from Local and Regional
Customers. From a segment perspective good growth in
Savoury and Sweet Goods was offset by weaker performancein Dairy.

Latin America

Sales in Latin America increased by 22.8% on a like-for-likebasis across all markets and segments in the region. Therewas strong growth led by Brazil, Mexico, Argentina andColombia. From a segment perspective the growth was
driven by double digit performance in Beverage, Snacks andDairy.

8 - Business performance: - Fragrance Division

Fragrance Division
Fragrance sales

Fragrance Division sales were CHF 1,361 million, an increase of 8.6%
on a like-for-like basis and an increase of 11.3% in Swiss francs over2018. The sales of the Fragrance Division include CHF 6 million fromNaturex, acquired in September 2018 and CHF 5 million from Albert
Vieille, acquired in May 2019. Sales growth from Expressions
Parfumées, acquired in 2018 was particularly strong in the first six
months of the year.
Sales growth was driven both by price increases to recover the
impact of higher input costs and strong growth of new wins.
Total sales for Fragrance Compounds (Fine Fragrances andConsumer Products combined) increased by 8.7% on a like-for-likebasis. In Swiss francs, sales of compounds increased to CHF 1,131
million from CHF 1,057 million in 2018.
Fine Fragrance sales increased by 8.5% on a like-for-like basis
against a strong comparable in 2018, with growth recorded in bothmature and high growth markets.

Fragrance Division sales
in millions of Swiss francs
2019

1,361

2018

1,223

2017

1,137

2016

1,132

2015

1,023

growth markets. Sales performance in Western Europe wasdriven by strong inflow of new business while North America
sustained a positive momentum with established volume growthat key clients. In the high growth markets, double-digit sales
performance in Asia and the Middle East was partially offset bylower sales in Latin America which had a strong comparable fromthe prior year.
This growth was also supported by an excellent awards season in
Latin America, the USA and Europe with many of our perfumers
receiving recognition for their contribution to create productsthat consumers love.

Consumer Products sales increased by 8.7% on a like-for-like basis.
The growth was delivered in both high growth and mature markets
and was spread across all customer groups and regions.
Consumer Products
Consumer Products sales increased by 8.7% on a like-for-like basis.
Sales of Fragrance Ingredients and Active Beauty increased by 8.2% The growth was delivered in high growth and mature markets andon a like-for-like basis with a double-digit growth in Active Beauty
was spread across all customer groups and all regions.
and good sales momentum in Fragrance Ingredients.
On a regional basis, Latin America reported double-digit growth
The EBITDA of the Fragrance Division increased to CHF 270 million with all customer groups and product segments contributing toin 2019 compared to CHF 250 million for the first six months of 2018. the strong growth. Asia delivered mid single-digit growth versus a
The increase is mainly driven by higher sales and the contribution of solid comparable period in 2018 driven by international customers
the recent acquisitions. The EBITDA margin decreased slightly toacross all sub-regions. The South Asia sub-region recorded
19.8% in 2019 from 20.4% in 2018, largely due to the higher raw
double-digit growth despite a high comparable, and the South
material costs. On a comparable basis the EBITDA margin of theEast Asia sub-region posted solid growth as well. In Europe, Africa
Fragrance Division was 21.3% in 2019 compared to 22.4% in 2018.
and the Middle East, the sales increase was driven by good
performance spread across all sub-regions, all customer groups,
In the first six months of 2019 the division incurred costs associated and all product segments, including double-digit growth in thewith the GBS project of CHF 19 million, compared to CHF 25 million African Middle East sub-region. North America grew double-digit,
in 2018.
which was attributed to a high sales increase with internationalcustomers.
The operating income increased by 5.0% to CHF 213 million in 2019,
versus CHF 203 million for the same period in 2018. The operating
On a product segment basis, all segments contributed to the sales
margin decreased to 15.7% in 2019 from 16.6% in 2018.
growth, notably double-digit growth of home care and solid
performance in Fabric Care and Personal Care.

Fine Fragrances

Fine Fragrance sales increased by 8.5% on a like-for-like basis
against a strong 2018 comparable, with growth recorded in bothmature and high growth markets. These gains were driven by ahigh level of new business wins across all customer groups andstrong market performance of recent launches.

Fragrance Ingredients and Active Beauty

Sales of Fragrance Ingredients and Active Beauty increased by
8.2% on a like-for-like basis. Active Beauty delivered double-digit
sales growth against a strong comparable driven by all customer
types and by the strong growth of active ingredients. Fragrance
Ingredients experienced good growth in the first six months of the
On a regional basis, growth was recorded in both mature and high year.

Givaudan – 2019 Half Year Report9 - Financial statements

2019 Half Year
Financial Report

Table of contents:

Givaudan – 2019 Half Year Report

10Interim condensed consolidated
financial statements

15

Notes to the interim condensed
consolidated financial statements

10 - Financial statements

Interim condensed consolidated financial
statements (unaudited)
Condensed consolidated income statement
For the six months ended 30 June

Note

2019

2018

6

3,094

2,674

Cost of sales(1,820)(1,492)Gross profit

1,274

1,182

as % of sales

41.2%

44.2%

Selling, marketing and distribution expenses

(373)

(342)

Research and product development expenses

(259)

(224)

Administration expenses

(109)

(95)

3

6

in millions of Swiss francs, except for earnings per share data

Sales

Share of (loss) profit of jointly controlled entities
Other operating income

7

11

9

Other operating expense

8

(56)

(47)

Operating income
as % of sales

491

489

15.9%

18.3%

Financing costs

9

(36)

(23)

Other financial income (expense), net

10

(18)

(35)

Income before taxes
Income taxes

11

Income for the period

437

431

(57)

(60)

380

371

Attribution
Income attributable to non-controlling interests–

Income attributable to equity holders of the parent

380

371

12.3%

13.9%

as % of sales
Earnings per share − basic (CHF)

12

41.24

40.26

Earnings per share − diluted (CHF)

12

40.94

39.84

The notes on pages 15 to 22 form an integral part of these interim condensed financial statements (unaudited).

Givaudan – 2019 Half Year Report11 - Financial statements

Condensed consolidated statement of comprehensive income
For the six months ended 30 Junein millions of Swiss francs

2019

2018

Income for the period

380

371

(49)

4

Items that may be reclassified to the income statement
Cash flow hedges
Movement in fair value, net
Gains (losses) removed from equity and recognised in the consolidated income statement

33

Movement on income tax

4–Exchange differences arising on translation of foreign operations
Movement in fair value arising on hedging instruments of the net assets in foreign operations

22

Change in currency translation

(46)

(31)

Movement on income tax(4)–

Items that will not be reclassified to the income statement
Defined benefit pension plans
Remeasurement gains (losses) of post-employment benefit obligations

(87)

131

Movement on income tax

(1)

(29)

Other comprehensive income for the period

(158)

78

Total comprehensive income for the period

222

449

Attribution
Total comprehensive income attributable to non-controlling interests–

Total comprehensive income attributable to equity holders of the parent

222

The notes on pages 15 to 22 form an integral part of these interim condensed financial statements (unaudited).

Givaudan – 2019 Half Year Report449

12 - Financial statements

Condensed consolidated statement of financial position
At period ended

in millions of Swiss francs

Note 30 June 201931 December
2018

Cash and cash equivalents

239

423

Derivative financial instruments

4

8

11

Financial assets at fair value through income statement

4

3

4

Accounts receivable - trade

1,384

1,253

Inventories

1,278

1,098

Current tax assets

52

41

Prepayments

66

53

Other current assets

179

238

3,209

3,121

Property, plant and equipment

2,183

1,759

Intangible assets

3,960

3,999

Deferred tax assets

220

208

Post-employment benefit plan assets

14

22

64

61

Jointly controlled entities

37

33

Investment property

2

2

Other long-term assets

75

61

Current assets
Derivative financial instruments

Financial assets at fair value through income statement

4

4

2

Non-current assets

6,555

6,147

Total assets

9,764

9,268

Short-term debt

14

696

4

Derivative financial instruments

4

21

12

Accounts payable - trade and others

835

719

Accrued payroll and payroll taxes

137

178

Current tax liabilities

90

95

Financial liability - own equity instruments

94

93

Provisions

19

24

Other current liabilities
Current liabilities

198

225

2,090

1,350

Derivative financial instruments

4

89

43

Long-term debt

14

3,253

3,266

Provisions

72

73

Post-employment benefit plan liabilities

572

490

Deferred tax liabilities

250

238

Other non-current liabilities

79

85

4,315

4,195

6,405

5,545

Non-current liabilities
Total liabilities
Share capital

15

92

92

Retained earnings and reserves

15

5,639

5,811

Own equity instruments

16

(176)

(142)

Other components of equity(2,209)(2,051)Equity attributable to equity holders of the parent

3,346

3,710

Non-controlling interests

13

13

Total equity

3,359

3,723

Total liabilities and equity

9,764

9,268

The notes on pages 15 to 22 form an integral part of these interim condensed financial statements (unaudited).
Givaudan – 2019 Half Year Report13 - Financial statements

Condensed consolidated statement of changes in equity
For the six months ended 30 June2019
in millions of Swiss francs

Balance as at 1 January

Retainedearnings
Share Capital and reserves

92

Income for the period

5,811

Own equity
instruments

Cash flow
hedges

(142)

(61)

Remeasurement of post
Currency employmenttranslation
benefitdifferences
obligations(1,559)

(431)

380

Other comprehensive
income for the period
Total comprehensive
income for the period

380

Dividends paid

(552)

Movement on own equity
instruments, net

(42)

(28)

(88)

(42)

(28)

(88)

Equityattributable
to equity
holders of
the parents

Noncontrollinginterests

Total equity

3,710

13

3,723

380

–

380

(158)
222

Balance as at 30 June

(34)

2018
in millions of Swiss francs

Balance as at 1 January

92

(552)

(34)

5,639

(176)

Retainedearnings
Share Capital and reserves

92

Income for the period

5,682

Own equity
instruments

Cash flow
hedges

(157)

(65)

Other comprehensive
income for the period
371

Dividends paid

(534)

Movement on own equity
instruments, net

(34)
–

–

(586)
(103)

(1,587)

222
(552)

(34)

(586)

(519)

3,346

13

3,359

Remeasurement of post
Currency employmenttranslation
benefitdifferences
obligations

Equityattributable
to equity
holders of
the parents

Noncontrollinginterests

Total equity(1,456)

(558)

371

Total comprehensive
income for the period

–

(552)

Non-controlling interests
Net change in other equity
items

(158)

7

(31)

102

7

(31)

102

(14)

3,538

3,538

371

371

78

78

449

449

(534)

(534)

(14)

(14)

Non-controlling interests
Net change in other equity
items
Balance as at 30 June

92

(534)

(14)

5,519

(171)

(58)

(1,487)

The notes on pages 15 to 22 form an integral part of these interim condensed financial statements (unaudited).

Givaudan – 2019 Half Year Report

(456)

(548)

(548)

3,439

3,439

14 - Financial statements

Consolidated statement of cash flows
For the six months ended 30 June

2019

2018

Income for the period

380

371

Income tax expense

57

60

Interest expense

31

17

Non-operating income and expense

23

41

Operating income

491

489

in millions of Swiss francs

Note

Depreciation of property, plant and equipment

88

58

80

52

1

2

- share-based payments

18

19- pension expense19

19- additional and unused provisions, net

4–Amortisation of intangible assets

6

Impairment of long-lived assets
Other non-cash items- other non-cash items

(18)

4

Adjustments for non-cash items

192

154

(Increase) decrease in inventories

(180)

(178)

(Increase) decrease in accounts receivable

(137)

(80)

(Increase) decrease in other current assets

(13)

28

Increase (decrease) in accounts payable

131

12

Increase (decrease) in other current liabilities

(72)

(54)

(Increase) decrease in working capital

(271)

(272)

Income taxes paid

(63)

(61)

Pension contributions paid

(18)

(20)

Provisions used

(9)

(9)

Purchase and sale of own equity instruments, net

(51)

(12)

Cash flows from (for) operating activities

271

269

Increase in long-term debt

14

6

350

(Decrease) in long-term debt

14

(170)

(9)

Increase in short-term debt

14

1,296

1,091

(Decrease) in short-term debt

14

(817)

(435)

Cash flows from debt, net

315

997

Interest paid

(10)

(13)

Purchase and sale of derivative financial instruments, net

(2)

(20)

Lease payments(19)

Other, net
Cash flows from financial liabilities
Distribution to the shareholders paid

15

–

(3)

284

961

(552)

(534)

Cash flows from (for) financing activities

(268)

427

Acquisition of property, plant and equipment

(138)

(129)

Acquisition of intangible assets

(17)

(21)

Acquisition of subsidiaries, net of cash acquired

5

(61)

(247)

Proceeds from the disposal of property, plant and equipment

13

61

Proceeds from disposal of investment property

714Interest received

3

1

Purchase and sale of financial assets at fair value through income statement, net

2

(605)

Impact of financial transactions on investing, net

(17)

(5)

Other, net

(20)

(6)

Cash flows from (for) investing activities

(187)

(991)

Net increase (decrease) in cash and cash equivalents

(184)

(295)

Net effect of currency translation on cash and cash equivalents–(8)

Cash and cash equivalents at the beginning of the period

423

534

Cash and cash equivalents at the end of the period

239

231

The notes on pages 15 to 22 form an integral part of these interim condensed financial statements (unaudited).
Givaudan – 2019 Half Year Report15 - Financial statements

Notes to the interim condensed consolidated
financial statements (unaudited)
1. Group organisation

Givaudan SA and its subsidiaries (hereafter ‘the Group’) operate under the name Givaudan. Givaudan SA is a limited liability
company incorporated and domiciled in Switzerland. The Group is headquartered in Vernier, near Geneva, Switzerland. Givaudan isa leading supplier of creative fragrance and flavour products to the consumer goods industry. It operates in over 100 countries andhas subsidiaries and branches in more than 40 countries. Worldwide, it employs 13,886 people.
The Group is listed on the SIX Swiss Exchange (GIVN).

2. Basis of financial statements

These financial statements are the unaudited interim condensed consolidated financial statements (hereafter ‘the interim financial
statements’) of the Group for the six months period ended 30 June 2019 (hereafter ‘the interim period’). They have been preparedin accordance with International Accounting Standard 34 ‘Interim Financial Reporting’.
The interim financial statements include the operations of Givaudan SA and its controlled subsidiaries where control is defined as
the power to govern the financial and operating policies of an enterprise so as to obtain benefits from its activities.
These interim financial statements should be read in conjunction with the 2018 consolidated financial statements as they provide
an update of the most recent financial information available.
Taxes on income in the interim period are accrued using the tax rate that would be applicable to expected total annual earnings.
The Group operates in markets where no significant seasonal or cyclical variations in sales are experienced during the financialyear.
The 31 December 2018 statement of financial position has been derived from the audited 2018 consolidated financial statements.
Givaudan SA’s Board of Directors approved these interim financial statements on 16 July 2019.

3. Accounting policies

The accounting policies adopted are consistent with those of the annual financial statements for the year ended
31 December 2018, as described in the 2018 consolidated financial statements with the exception of the adoption as of
1 January 2019 of the standards and interpretation described below:
IFRS 16 Leases provides a single lessee accounting model, requiring lessees to recognise assets and liabilities for all leases and lessors
to confirm the continuation of classifying leases as operating or finance. The Group is not a lessor and is impacted by the standard
only for the lessee accounting. The standard replaces IAS 17 Leases, under which operating lease payments were charged to theincome statement on a straight-line basis over the term of the contract.
Under IFRS 16, at the inception of a contract, the Group assesses whether it is or contains a lease. The Group recognises a right-ofuse asset and a corresponding lease liability with respect to all lease agreements, except for short-term leases defined as leases witha lease term of 12 months or less, and low-value assets, which are recognised on a straight-line basis as an expense in the
consolidated income statement, as done previously under IAS 17.
The lease liability is initially measured at the present value of the future lease payments as from commencement date of the lease.
The lease payments are discounted by using the interest rate implicit in the contract and if not available the incremental borrowing
rate, which is defined as the interest rate that the Group would have to pay to borrow, over a similar term and with a similar security,
the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment.
The lease liability is subsequently measured by increasing the carrying amount of the lease liability to reflect interest, lease payments
and any lease modifications.

Givaudan – 2019 Half Year Report16 - Financial statements

The lease liability is presented under the lines short-term debt and long-term debt in the consolidated statement of financial position.
The interest expense is presented in the line financing costs in the consolidated income statement.
The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before thecommencement date and initial direct costs. Right-of-use assets are subsequently measured at cost less accumulated depreciationand impairment losses, adjusted for any remeasurement of the lease liability. They are depreciated over the shorter period of the leaseterm and the useful life of the underlying asset. Right-of-use-assets are presented in the consolidated statement of financial position
under the line property, plant and equipment.
All lease payments on leases are presented as part of cash flows from financing activities, except for the short-term and low-value
leases cash flows which are booked under operating activities.
The Group applied the standard from its mandatory adoption date of 1 January 2019. The Group applied the cumulative catch-up
approach and did not restate comparative amounts for the year prior to first adoption.
On 1 January 2019 the Group recognised right-of-use assets and lease liabilities of CHF 253 million that were previously recognised
as operating leases under IAS 17. The effect of applying the new standard of IFRS 16 does not have a material impact on thepresentation of the consolidated income statement and the consolidated statement of cash flows. The difference between the leaseliability recognised at 1 January 2019 and the non-discounted amount of the minimum commitments under operating leases
disclosed at 31 December 2018 of CHF 377 million, is mainly due to the lease contract of the Zurich Innovation Centre (ZIC) which
was made available for use in the first quarter of 2019. In addition, differences also arise due to the effect of discounting leaseliabilities, the exemption for short-term and low-value assets, as well as the differences between the contractual non-cancellable
period and the intended duration of the use of the assets.
IFRIC 23 Uncertainty over Income Tax Treatments clarifies the accounting for uncertainties in income taxes. The clarification
confirms the current practices of the Group.
Amendments to IAS 28: Long-term Interests in Associates and Joint Ventures clarify that an entity must apply IFRS 9
Financial Instruments to long-term interests in an associate or joint venture that form part of the net investment in the associate
or joint venture but to which the equity method is not applied. The adoption of these amendments has no impact on the joint
arrangements currently held by the Group.
Amendments to IFRS 9: Prepayment Features with Negative Compensation address the concerns about how IFRS 9 Financial
Instruments classifies particular prepayable financial assets. These amendments have no impact as the Group does not enter insuch particular instruments.
Annual Improvements to IFRS Standards Cycle 2015 - 2017 set out amendments across four different standards, related basis
for conclusions and guidance, namely amendments to IFRS 3 Business Combinations and IFRS 11 Joint Arrangements, IAS 12 Income
Tax and IAS 23 Borrowing Costs. These amendments are not relevant for the Group, and the adoption therefore has no impact.
Plan Amendment, Curtailment or Settlement: Amendments to IAS 19 state that if a plan amendment, curtailment or
settlement occurs, it is now mandatory that the current service cost and the net interest for the period after the remeasurement
are determined using the assumptions used for the remeasurement. It also clarifies the effect of a plan amendment, curtailment or
settlement on the requirements regarding the asset ceiling. The adoption of the amendments confirms the current practice of theGroup.

Givaudan – 2019 Half Year Report17 - Financial statements

4. Financial risk management
Interest rate risk
In January 2019 the Group entered into a forward starting interest rate swap to fix the interest rate in relation to highly probablefuture Swiss franc debt issuance. The swap, in the amount of CHF 25 million, will commence in April 2020 with a fixed rate of
0.0225% and a 5 year maturity. The interest rate swapped is assigned to an underlying straight bond debt of CHF 150 million, issued
in April 2018 and with a maturity in April 2020.
During the first half of 2019 the Group entered into several forward starting interest rate swaps, in the total amount of EUR 400
million, to fix the interest rates in relation to highly probable future Euro debt issuance. A swap of EUR 50 million which willcommence in December 2024 with a 7 year maturity and a fixed rate of 1.6790% is assigned to the EUR 200 million private
placement (Schuldschein) which was issued in 2017 with a 7 year maturity. Swaps, in the total amount of EUR 200 million, which
will commence in September 2025 with a 7 year maturity and an average fixed rate of 1.5024% are assigned to the EUR 500 million
straight bond which was issued in 2018 with a 7 year maturity. Swaps, in the total amount of EUR 150 million, which will commencein September 2030 with a 10 year maturity and an average fixed rate of 1.7120% are assigned to the EUR 800 million straight bondwhich was issued in September 2018 with a 12 year maturity.
Fair value measurements recognised in the statement of financial position
Financial assets consisting of equity and debt securities of CHF 3 million (31 December 2018: CHF 2 million) were measured with
Level 1 inputs whereas CHF 31 million (31 December 2018: CHF 32 million) were measured with Level 2 inputs. Corporate owned life
insurance of CHF 33 million (31 December 2018: CHF 31 million) were measured with Level 2 inputs.
Derivative assets of CHF 8 million (31 December 2018: CHF 13 million) and derivative liabilities of CHF 110 million(31 December 2018: CHF 55 million) were measured with Level 2 inputs. Derivative assets and liabilities consist of forward foreignexchange contracts that are measured using quoted forward exchange rates and yield curves derived from quoted interest rates
matching maturities of the contracts, and of interest swaps that are measured using quoted interest rates and yield curves derived
from quoted interest rates matching maturities of the contracts.
There was no transfer between the level categories in the period. The Group did not carry out any transactions on Level 3 inputs
during the period presented in these interim financial statements.

5. Acquisitions
AMSilk
On 25 April 2019 Givaudan acquired the cosmetics business of AMSilk GmbH for a purchase price of CHF 7 million. AMSilk is theworld’s first industrial supplier of vegan silk biopolymers and has its headquarters near Munich, Germany. AMSilk offers a range ofhigh-performance biosourced polypeptides with unique functional properties in the field of cosmetics. These vegan biopolymers
offer a broad range of applications across categories such as hair care and skin care with benefits like silk touch, anti-pollution, or
colour protection of the hair. Over the last 9 years, they have filed 10 patents for the use of biopolymers in cosmetic applications.
From 25 April 2019, the acquisition has not contributed any sales to the Group’s consolidated results.
The identifiable assets and liabilities of the cosmetics business of AMSilk acquired are recorded at fair value at the date ofacquisition and no goodwill has been recognised. In compliance with IFRS 3, these values determined are provisional and the Group
has twelve months from the date of acquisition to finalise the allocation of the acquisition price.

Givaudan – 2019 Half Year Report18 - Financial statements

Albert VieilleOn 3 May 2019 Givaudan acquired 100% of the share capital of Albert Vieille and its affiliates for a purchase price of CHF 54 million.
Albert Vieille has unique know-how in the realm of aromatic plants and specialises in 100% pure essential oils and speciality naturalingredients. The natural ingredients are used for the formulation of perfumes and aromatherapy products. With its origins datingback to 1920, and with more than 60 employees, Albert Vieille is based close to Grasse, in France, and has a manufacturing facilityin Spain, with its products sold globally through a network of distributors. They source their raw materials across the world, wherefragrant crops are harvested and have developed over many years strong capabilities in natural ingredients sourcing andprocessing. From 3 May 2019, the acquisition contributed CHF 5 million of sales to the Group’s consolidated results.
The goodwill of CHF 27 million arising on the acquisition relates mainly to the value of the qualified workforce and expectedsynergies that do not meet the criteria for recognition as separable intangible assets. The identifiable assets and liabilities of Albert
Vieille acquired are recorded at fair value at the date of acquisition.
In compliance with IFRS 3, these values determined are provisional and the Group has twelve months from the date of acquisition
to finalise the allocation of the acquisition price.

6. Segment information
Business segments
Fragrances
For the six months ended 30 June, in millions of Swiss francs

Segment sales
Less inter segment sales a
Segment sales to third parties
EBITDA

Flavours

Group

2019

2018

2019

2018

2019

2018

1,361

1,223

1,737

1,457

3,098

2,680

–

–

(4)

(6)

(4)

(6)

1,361

1,223

1,733

1,451

3,094

2,674

270

250

390

351

660

601

as % of sales

19.8%

20.4%

22.5%

24.2%

21.3%

22.5%

Depreciation

(34)

(25)

(54)

(33)

(88)

(58)

Amortisation

(23)

(21)

(57)

(31)

(80)

(52)

Impairment of long-lived assets

–

(1)

(1)

(1)

(1)

(2)

Additions to Property, plant and equipment

61

27

211

55

272

82

Acquisitions of Property, plant and equipment

6

26

2

6

28

Additions to Intangible assets

17

13

Acquisitions of Intangible assets (excluding goodwill)

20

46

Total gross investments

104

112

a)	Transfer prices for inter-divisional sales are set on an arm's length basis.

Givaudan – 2019 Half Year Report

10
221

13

27

26

14

20

60

84

325

196

19 - Financial statements

Reconciliation table to Group’s operating income
Fragrances

Flavours

Group

For the six months ended 30 June, in millions of Swiss francs

2019

2018

2019

2018

2019

2018

EBITDA

270

250

390

351

660

601

Depreciation

(34)

(25)

(54)

(33)

(88)

(58)

Amortisation

(23)

(21)

(57)

(31)

(80)

(52)

Impairment of long-lived assets
Operating income
as % of sales

–

(1)

(1)

(1)

(1)

(2)

213

203

278

286

491

489

15.7%

16.6%

16.0%

19.7%

15.9%

18.3%

Financing costs

(36)

(23)

Other financial income (expense), net

(18)

(35)

Income before taxes

437

431

14.1%

16.1%

as % of sales

Classification of amortisation expenses is as follows:
Fragrances

Flavours

Group

2019

2018

2019

2018

2019

Cost of sales

3

2

5

5

8

7

Selling, marketing and distribution expenses

9

8

13

12

22

20

Research and product development expenses

6

7

29

10

35

17

Administration expenses

2

2

7

2

9

4

Other operating expenses

3

2

3

2

6

4

Total

23

21

57

31

80

52

For the six months ended 30 June, in millions of Swiss francs

2018

7. Other operating income
2019

2018

Gains on disposal of fixed assets––

Other income

119

Total other operating income

119

For the six months ended 30 June, in millions of Swiss francs

8. Other operating expense
2019

2018

Project related expenses a

21

25

Amortisation of intangible assets

65

Impairment of long-lived assets

1

2

Losses on disposal of fixed assets

1

3

Environmental provisions––

For the six months ended 30 June, in millions of Swiss francs

Business taxes

10

6

Acquisition and integration related expenses

91

Other expenses

8

5

Total other operating expense

5647a)	Primarily relates to Givaudan Business Solutions (GBS).

Givaudan – 2019 Half Year Report20 - Financial statements

9. Financing costs
2019

2018

Interest expense31

17

Net interest related to defined benefit pension plans

4

5

Amortisation of debt discounts

1

1

Total financing costs

36

23

2019

2018

For the six months ended 30 June, in millions of Swiss francs

10. Other financial (income) expense, net
For the six months ended 30 June, in millions of Swiss francs

Fair value and realised (gains) losses from derivatives instruments, net (at fair value through income statement)

32

4

Exchange (gains) losses, net

(18)

21

Unrealised (gains) losses from financial instruments measured at fair value through income statement(5)–

Interest (income) expense

(2)

(1)

Capital taxes and other non business taxes

4

7

Other (income) expense, net

74

Total other financial (income) expense, net

1835

11. Income taxes

The Group has assessed the impact of the Swiss Tax Reform on its deferred tax balances and deemed the impact to be notmaterial.

12. Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the net income attributable to shareholders by the weighted average number ofshares outstanding:
For the six months ended 30 June

2019

2018

Income attributable to equity holder of the parent (in millions of Swiss francs)

380

371

Ordinary shares

9,233,586

9,233,586

Treasury shares(19,197)(18,397)

Weighted average number of shares outstanding

Net weighted average number of shares outstanding
Basic earnings per share (CHF)

9,214,389 9,215,189
41.24

40.26

Diluted earnings per share
For the calculation of diluted earnings per share, the weighted average number of shares outstanding is adjusted to assume
conversion of all potentially dilutive shares:
For the six months ended 30 June

2019

2018

Income attributable to equity holder of the parent (in millions of Swiss francs)

380

371

Weighted average number of shares outstanding for diluted earnings per share of 67,443 (2018: 96,640)
Diluted earnings per share (CHF)

Givaudan – 2019 Half Year Report

9,281,832 9,311,829
40.94

39.84

21 - Financial statements

13. Property, Plant and Equipment
In 2018 the Group sold and leased back its Zurich Innovation Centre (ZIC) for an amount of CHF 173 million. CHF 100 million had
been received in 2018 and an additional CHF 60 million has been received in the first semester of 2019. The remainder will bereceived in the second half of 2019.

14. Debt
Floating rate debt
2019in millions of Swiss francs

Bankborrowings

Balance as at 1 January
Cash flows

472

Bank
facilityBank
overdrafts

169

3

(169)

2

Total
short-term
andStraight
Private long-termbonds placements
debt

Fixed rate debt
Straight
PrivateBank
bonds placements borrowings

151

112

11

2,354

470

10

Total
capitalised
lease
liabilities

Total debt

3,270

253

3,523

315

(19)

296

Non-cash changes- Amortisation of debt
discount–- Acquisition / Divestment- Currency effects

–

1
(17)

1

–

1

4

–

(1)

3

8
(49)

(22)

(7)

(47)

(2)
170

170

2,333

463

3,544

405

3,949

38

658

38

696

259

73

332

513

56

569

- Lease liabilities
Balance as at 30 June

455

6

151

Within 1 year

449

6

151

Within 1 to 3 years

5

Within 3 to 5 years

1

111

14
5

249

111

5

250

1

1,834

279

2,114

238

2,352

111

25

2,333

463

3,544

405

3,949

Thereafter
Balance as at 30 June

455

6

151

Floating rate debt
2018
in millions of Swiss francs

Bankborrowings

Balance as at 1 January

1

Cash flows

30

Bank
facilityBank
overdrafts

169

(5)

25

146

Total
short-term
andStraight
Private long-termbonds placements
debt

Fixed rate debt
Straight
PrivateBank
bonds placements borrowings

7

117
151

9

998

(259)

1,352

2

1

476

1,608
1,438

Non-cash changes- Amortisation of debt
discount–- Acquisition / Divestment- Currency effects

–

1
(31)

–

259

–

(5)

3
260

3

(6)

(39)

2,354

470

3,270

249

39

444

- Interest
Balance as at 31 December

169

Within 1 year

3

112

3

Within 1 to 3 years
Within 3 to 5 years

151
151

5
112

Thereafter
Balance as at 31 December

169

3

11
1

169
151

112

4

4

100

147

532

1

2,005

284

2,290

11

2,354

470

3,270

In January 2019 Givaudan SA repaid borrowings of EUR 150 million (CHF 169 million) under the Group bank credit facility.
During the first six months of 2019, Givaudan entered into short-term loans for a total net amount of CHF 482 million, which areplanned to be repaid by the end of 2019. The proceeds were used for general corporate purposes.

Givaudan – 2019 Half Year Report15

22 - Financial statements

A weighted average incremental borrowing rate of 3% was applied to calculate the lease liability at 1 January 2019, the date of
implementation of IFRS 16.

15. Equity

At the Annual General Meeting held on 28 March 2019 the distribution of an ordinary dividend of CHF 60.00 per share(2018: ordinary dividend of CHF 58.00 per share) was approved. The dividend payment has been paid out of available retained
earnings. At 30 June 2019, the share capital amounts to CHF 92,335,860, divided into 9,233,586 fully paid-up registered shares witha nominal value of CHF 10.00 each. Each share gives the right to one vote.

16. Own equity instruments

The Group holds own equity instruments and derivatives on own shares mainly to cover the anticipated obligations related to the
executive share plans. At 30 June 2019, the Group held 15,541 own shares (2018: 5,906), as well as derivatives on own shares
equating to a total long position of 44,000 (2018: 59,000).

17. Contingent liabilities

From time to time and in varying degrees, Group operations and earnings continue to be affected by political, fiscal and regulatory
developments, including those relating to environmental protection, in the countries in which it operates.
The activities in which the Group is engaged are also subject to physical risks of various kinds. The nature and frequency of thesedevelopments and events, not all of which are covered by insurance, as well as their effect on the future operations and earnings
are not predictable.
Givaudan Group companies are involved in various legal and regulatory proceedings of a nature considered typical of its business,
including contractual disputes and employment litigation.
One of the Group’s US affiliates, Givaudan Flavors Corporation was named as a defendant in several lawsuits brought against it
and other flavour and raw chemical supply companies. The plaintiffs alleged that they sustained pulmonary injuries due to diacetyl-containing butter flavours manufactured by one or more of the flavour and raw chemical supply company defendants. The
majority of the cases filed against Givaudan Flavors Corporation have been settled. The Group has already recovered or will
recover amounts it is entitled to under the terms of its insurance policies.

18. Other Information

As part of its 2020 strategy to strengthen its naturals capabilities and its presence in the high growth markets of Asia Pacific,
Givaudan announced that it has reached an agreement to acquire Golden Frog, a Vietnamese flavour company. Golden Frog
manufactures natural flavours, extracts and essential oils for the food and beverage industry. It offers a wide range of naturalingredients including herbs, spices, fruit and vegetable extracts and essential oils from the great biodiversity of Vietnam. With
headquarters and manufacturing facilities in the Ho Chi Minh area, Golden Frog employs 156 people and caters to the needs of theASEAN markets. The closing of the acquisition is expected to take place in the second half of 2019.

Givaudan – 2019 Half Year Report23 - Alternative Performance Measures

Alternative Performance Measures
Appendix to the 2019 Half Year Results
Introduction

On 1 January 2019 the Directive Alternative Performance Measures (DAPM), issued by the SIX Exchange Regulation, came into force
with the purpose to promote the clear and transparent use of alternative performance measures.
The Directive prescribes that clear and comprehensible definitions must be disclosed for all alternative performance measuresused. Also, for alternative performance measures that are based on a measure included in the financial statements prepared inaccordance with recognised accounting standards and which have been adjusted by adding or omitting specific items, areconciliation statement must be disclosed to a comparable measure in the financial statement according to the recognised
accounting standard. Significant reconciliation items must be explained.

Givaudan’s Alternative Performance Measures

In the 2019 Half Year Results Media Release and on pages 6-9 of the 2019 Half Year Report, the Group uses a number of Alternative
Performance Measures that are listed and defined below.
Like-for-Like (LFL)
LFL is defined as: (a) sales calculated using the invoicing exchange rates of the prior year, and (b) excluding sales of businesses
acquired from the acquisition date until the period end date, up to 12 months from the acquisition date.
Reconciliation tables of the LFL sales to the reported sales in accordance with IFRS have been included in the 2019 Half Year Results
Media Release.
EBITDAEBITDA defined as Earnings Before Interest (and other financial income (expense), net), Tax, Depreciation and Amortisation,corresponds to operating income before depreciation, amortisation and impairment of long-lived assets.
For the six months ended 30 June, in millions of Swiss francs

2019

2018

Income for the period

380

371

Interest and other financial (income) expense, net

54

58

Income taxes

57

60

Operating income

491

489

Depreciation

88

58

Amortisation

80

52

Impairment

1

2

660

601

EBITDA**	The adoption of IFRS 16 Leases resulted in an increase in EBITDA of CHF 11 million, or 0.4% in 2019. The Group has not restated the comparable 2018 EBITDA figures, as
permitted by IFRS 16.

Comparable EBITDA
Comparable EBITDA is the reported EBITDA, as adjusted for significant items of a non-recurring nature which have an impact on
the understanding of the underlying normal operating activities.
A reconciliation table of the published EBITDA to the Comparable EBITDA (EBITDA as defined in the section EBITDA above) has
been included in the 2019 Half Year Results Media Release. In that reconciliation table, all significant one-off items have been
explained.

Givaudan – 2019 Half Year Report

24 - Alternative Performance Measures

Free Cash Flow (FCF)
FCF refers to operating cash flow after net investments, interest paid and lease payments.
For the six months ended 30 June, in millions of Swiss francs

2019

2018

Cash flows from (for) operating activities

271

269

Acquisition of property, plant and equipment

(138)

(129)

Proceeds from the disposal of property, plant and equipment

61

7Acquisition of intangible assets

(17)

(21)

Interest paid

(10)

(13)

Lease payments*(19)

Proceeds from the disposal of intangible assets

Free cash flow (FCF)

148

113

Sales

3,094

2,674

Free cash flow (FCF) as a % of sales

4.8%

4.2%

*	Lease payments became part of the reconciliation in 2019, as a consequence of the adoption of IFRS 16. This was not applicable in 2018 as lease payments were included in
Cash Flows from (for) operating activities.

Leverage Ratio
Leverage ratio is defined as net debt divided by the sum of net debt and equity (as defined for leverage ratio in the table below).
In millions of Swiss francs

30 June 201931 December 2018

Short-term debt

696

4Long-term debt

3,253

3,266

Less: cash and cash equivalents

(239)

(423)

Net debt*

3,710

2,847

Total equity attributable to equity holders of the parent

3,346

3,710

Remeasurement of post-employment benefit obligations

519

431

Equity (as defined for leverage ratio)

3,865

4,141

Net debt and equity (as defined for leverage ratio)

7,575

6,988

Leverage ratio*

49%

41%

*	As a consequence of the adoption of IFRS 16 the net debt increased by CHF 405 million. Without this increase the leverage ratio would have been 46%.

Givaudan – 2019 Half Year Report25 - Financial statements

Givaudan – 2019 Half Year Report26 - Financial statements

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Investor Calendar

Half year conference, Zurich: 30 August 2017
Nine month sales results: 10 October 2017
Full year results: 26 January 2018
Annual General Meeting: 22 March 2018
Dates may be subject to change, please consult the calendar on the Givaudan
website: www.givaudan.com/investors/shareholder-information/investor-calendar

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This Half Year Report and Financial statements may contain forward-looking information.
Such information is subject to a variety of significant uncertainties, including
scientific, business, economic and financial factors. Therefore actual results
may differ significantly from those presented in such forward looking statements.
Investors must not rely on this information for investment decisions.
© Givaudan SA, 2019

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