2015 Half Year ReportIntroduction
Givaudan captures the essenceof fragrances and flavours

and offers an endless source of
surprising experiences.

As the industry leader, withapproximately 25% share of thefragrance and flavour market, weconstantly challenge ourselves tobuild partnerships worldwide andto offer exceptional service to ourcustomers with innovative products
and distinctive concepts.

We create the pleasures of taste andscent in millions of ways, touchingbillions of lives. From fine fragrances
to laundry care, from your favourite

beverage to your daily meal, Givaudan
is delighted to engage your senses,
every day, everywhere.

In this section:04

Key figures

05

At a glance

06

Business performance

08

Fragrance Division10

Flavour Division

13

Half year financial reportKey figures
First half of 2015

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

2015

2014

Group sales

2,184

2,191

Fragrance sales

1,023

1,034

Flavour sales

1,161

1,157

Gross profit

1,016

1,020

as % of sales

46.5%

46.6%

EBITDA1
as % of sales

566

562

25.9%

25.6%

Operating income

428

422

19.6%

19.2%

339

305

as % of sales

15.5%

13.9%

Earnings per share – basic (CHF)

36.82

33.13

Earnings per share – diluted (CHF)

36.37

32.71

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

Operating cash flow
as % of sales
Free cash flow

341

218

15.6%

9.9%

248

178

11.4%

8.1%

30 June 201531 December 2014

Current assets

2,140

2,357

Non-current assets

3,780

4,115

Total Assets

5,920

6,472

869

921

Non-current liabilities

2,028

2,138

Equity

3,023

3,413

Total liabilities and equity

5,920

6,472

Number of employees

9,750

9,704

as % of sales
in millions of Suisse francs, except employee data

Current liabilities

1 BITDA: Earnings Before Interest (and other financial income (expense), net), Tax, Depreciation and Amortisation.
E
This corresponds to operating income before depreciation, amortisation and impairment of long-lived assets.

4 – Half Year Report 2015 – Givaudan SA

At a glance
Key financial indicators
Sales by market

Half year sales
in millions of Swiss francs and percentage LFL1

46%
Developing

2,184

1,161

increaseof 2.6%
1

Group

54%
MatureFlavours

Fragrances

1,023

increaseof 1.3%

LFL = Like-for-like excludes the impact of currency, acquisitions and disposals.

CHF 566 million

25.9%

CHF 248 million

CHF 1,016 million

46.5%

CHF 339 million

EBITDA

Gross profit

EBITDA margin

Free cash flow

Net income, up 11.2% year-on-year

Gross margin

Givaudan share price evolution 2010-2015
1,900
1,700
1,500
1,300
1,100
900
700
500
2010

2011

2012

2013

2014

2015
Givaudan SA – Half Year Report 2015 – 5

Business performance
Strongly improved free cash flow, on track toachieve 2015 targets
Givaudan Group sales for the first six months of the year were1
CHF 2,184 million, an increase of 1.3% on a like-for-like basis
and a decline of 0.3% in Swiss francs.

Fragrance Division sales were CHF 1,023 million, flat on a likefor-like basis and a decline of 1.1% in Swiss francs.
Flavour Division sales were CHF 1,161 million, an increase of
2.6% on a like-for-like basis and 0.4% in Swiss francs.

Gross margin

Financial performance
Financing costs were CHF 31 million in the first half of2015, versus CHF 32 million for the same period in 2014.
The decrease was as a result of the lower net debt in theGroup. Other financial expense, net of income, was
CHF 16 million in 2015 versus CHF 14 million in 2014.

The gross margin was 46.5% in 2015 compared to 46.6% in
2014. Savings from the transfer of products to the newflavours manufacturing facility in Makó, Hungary from
Kemptthal, Switzerland more than offset general increases inoperational expenses. However, the gross margin was
distorted by the impact of currency movements following theappreciation of the Swiss franc.

The interim period income tax expense as a percentage ofincome before taxes was 11%, considerably lower than in 2014
following changes in Swiss Accounting Law and the Group’s
operating structure. Excluding these items, the income tax
expense as a percentage of income before taxes was 19%.

Earnings before Interest, Tax, Depreciation andAmortisation (EBITDA)

The net income for the first six months of 2015 was
CHF 339 million compared to CHF 305 million in 2014, anincrease of 11.2%. This results in a net profit margin of 15.5%
versus 13.9% in 2014. Basic earnings per share were CHF 36.82
versus CHF 33.13 for the same period in 2014.

The EBITDA increased by 0.6% to CHF 566 million from
CHF 562 million for the same period in 2014. A continued focus
on internal costs was the main enabler of the improvement.
In the first six months of 2015 the Group recognised a net
one-off non-cash gain of CHF 20 million, mainly following achange in pension plans. As a reminder, in the first six monthsof 2014 the Group recognised a one-off gain of CHF 38 million
in the Flavour Division on the disposal of land at its Dübendorf
location in Switzerland. When measured in local currency
terms, the EBITDA increased by 6.4%. The EBITDA marginincreased to 25.9% in 2015 from 25.6% in 2014.

Operating income
The operating income increased by 1.6% to CHF 428 million
from CHF 422 million for the same period in 2014.
When measured in local currency terms, the operating
income increased by 8.8%. The operating margin increased to19.6% in 2015 from 19.2% in 2014.

1

L ike-for-like excludes the impact of currency, acquisitions and disposals.

6 – Half Year Report 2015 – Givaudan SA

Net income

Cash flow
Givaudan delivered an operating cash flow of CHF 341 million
for the first six months of 2015 compared to CHF 218 million
in 2014, driven by a sustained EBITDA and an improvement
in working capital. Working capital as a percentage of sales
slightly decreased in 2015 when compared to the same period
in 2014.

CHF 248 million
Free cash flow

EBITDAain millions of Swiss francs

Sales
in millions of Swiss francs
2,225

Operating income
in millions of Swiss francs
566

562

2,191

2,184

509

428

422
377

2013

2014

2015

2013

Total investments in property, plant and equipment were
CHF 57 million, compared to CHF 46 million incurred in 2014.
The Group completed the investment in Nantong, China andprogressed as planned with the investment in Singapore.
Intangible asset additions were CHF 17 million in 2015,
compared to CHF 21 million in 2014. As a reminder, in 2014 theGroup received cash of CHF 56 million as a result of the saleof land at its Dübendorf location in Switzerland. Total net
investments in tangible and intangible assets were 3.4% ofsales, compared to 0.5% in 2014.
Operating cash flow after net investments was
CHF 267 million, versus the CHF 207 million recorded in
2014. Free cash flow, defined as operating cash flow afterinvestments and interest paid, was CHF 248 million in the firsthalf of 2015, versus CHF 178 million for the comparable period
in 2014. As a percentage of sales, free cash flow in the first six
months of 2015 was 11.4%, compared to 8.1% in 2014.

2014

2015

2013

2014

2015

Mid-term guidance
Mid-term, the overall objective is to grow organicallybetween 4.5% and 5.5% per annum, assuming a market
growth of 2-3%, and to continue on the path of market sharegains. By delivering on the Company’s five-pillar growthstrategy – developing markets, Health and Wellness, market
share gains with targeted customers and segments, researchand sustainable sourcing – Givaudan expects to outgrow theunderlying market and to continue to achieve its industryleading EBITDA margin while targeting an annual free cash
flow of between 14% and 16% of sales by the end of 2015.
Givaudan confirms its intention to return above 60% of theCompany’s free cash flow to shareholders while maintaining a
medium term leverage ratio target below 25%.

Financial position
Givaudan’s financial position remained strong at the end ofJune 2015. Net debt at June 2015 was CHF 1,050 million, up
from CHF 795 million at December 2014. The leverage ratio
was 23% compared to 17% at the end of 2014. The main reason
for the increase in the leverage ratio was the payment of the
CHF 461 million dividend in the first quarter of 2015.

a) EBITDA: Earnings Before Interest (and other financial income (expense), net),
Tax, Depreciation and Amortisation. This corresponds to operating income
before depreciation, amortisation and long-lived assets.

Givaudan SA – Half Year Report 2015 – 7

Fragrance Division

Fragrance Division sales were CHF 1,023 million, flat ona like-for-like basis and a decline of 1.1% in Swiss francs.
Including Soliance, the growth was 1.4% in local currency.

Total sales for Fragrance compounds (Fine Fragrances andConsumer Products combined) increased by 1.0% on a like-forlike basis. In Swiss francs, sales of compounds declined to
CHF 892 million from CHF 905 million.

CHF

1,023 million

Fragrance Division sales

Fine Fragrance sales grew 0.8% on a like-for-like basis driven
both by mature and developing markets.

Sales for the Consumer Products business increased by 1.0%
on a like-for-like basis, as a result of the good performance indeveloping markets.
Sales of Fragrance and Cosmetic Ingredients decreasedby 7.9% on a like-for-like basis, mainly affected by lower
commodity sales. The sales of Soliance, which was acquiredon 2 June 2014, were CHF 17 million for the first six months of2015, growing double-digit in local currency when comparedto the same period of last year. Including Soliance, thegrowth of Fragrance and Cosmetic Ingredients was 4.0% in
local currency.

EBITDAain millions of Swiss francs

Sales
in millions of Swiss francs
1,047

253

1,034

Operating income
in millions of Swiss francs

252

244

1,023

193

2013

2014

2015

2013

a) EBITDA: Earnings Before Interest (and other financial income (expense), net),
Tax, Depreciation and Amortisation. This corresponds to operating income
before depreciation, amortisation and long-lived assets.

8 – Half Year Report 2015 – Givaudan SA

2014

2015

188

2013

2014

2015

181

The EBITDA declined to CHF 244 million in 2015 comparedto CHF 252 million for the first six months of 2014.
The EBITDA margin declined to 23.8% in 2015 from 24.3%
in 2014. The Division incurred one-off non-cash charges of
CHF 12 million in the first six months of 2015.
The operating income decreased by 3.5% to CHF 181 million
in 2015, versus CHF 188 million for the same period in 2014.
The operating margin decreased to 17.7% in 2015 from 18.1%
in 2014.

Fine Fragrances
Fine Fragrance sales grew 0.8% on a like-for-like basis
in the first half of the year with sales improving in thesecond quarter.
On a regional basis the business delivered growth in bothmature and developing markets. In the developing markets,
a combination of new business and volume growth in Asiaand the Middle East more than compensated for lower salesin Latin America, which were impacted by a weak market
in Brazil. In the mature markets, sales growth in Western
Europe was favourably impacted by a strong inflow of new
business. This growth more than offset lower sales in North
America where new business was not able to offset erosion.
At the major industry award ceremonies in Europe and theUSA, a number of Givaudan fragrances received recognition
including: A Thousand Wishes by Bath and Body Works, Tom
Ford’s Velvet Orchid and Mandarino Di Amalfi, Intoxicated by
Kilian, Bottega Veneta Pour Homme Eau Extreme, Bottega
Veneta Knot, Christian Dior Miss Dior Blooming Bouquet,
Narciso by Narciso Rodriguez. In addition, J’Adore received aHall of Fame award at the ceremonies in the USA.

Consumer Products
The Consumer Product Business Unit sales grew by 1.0% on
a like-for-like basis with good growth in developing markets
more than offsetting lower sales growth in mature markets.
Local and regional customers showed good growth acrossall regions.
On a product segment basis, the sales growth was sustainedby the strong increase on the fabric care segment, followedby oral care. The home care and personal care segments
contributed as well to the growth in developing markets.

Fragrance and Cosmetic Ingredients
Sales of Fragrance and Cosmetic Ingredients decreasedby 7.9% on a like-for-like basis, mainly affected by lower
commodity sales. The sales of Soliance, which was acquiredon 2 June 2014, were CHF 17 million for the first six monthsof 2015, growing double-digit in local currency whencompared to the same period of last year. Including Soliance,
the growth of Fragrance and Cosmetic Ingredients was
4.0% in local currency. All product categories in Fragrance
Ingredients declined, however, the specialities business
was the least impacted. The earlier announced producttransfers to the production site in Mexico and the joint
venture partner in China are on schedule and will continue toensure that the Group remains competitive in the fragrance
ingredients market.

Givaudan SA – Half Year Report 2015 – 9

Flavour Division

Flavour Division sales were 1,161 million during the first six
months of 2015, an increase of 2.6% on a like-for-like basis and
0.4% in Swiss francs.

Sales growth during the second quarter was influenced bystrong growth in the mature markets as well as the emerging
markets of Asia Pacific and Latin America. New wins andexisting business growth contributed to the increase.
Difficult economic conditions continue to impact growth inEastern Europe, Africa and the Middle East. Segment growthin Beverage, Dairy and Snacks was achieved as a result of new
wins and existing business increases.
The EBITDA increased by 3.9% to CHF 322 million in 2015 from
CHF 310 million for the first six months of 2014. The EBITDA
margin was 27.8% in 2015, up from 26.8% in 2014. In the firstsix months of 2015 the Division recognised a one-off non-cash
gain of CHF 32 million following a change in pension plans.
As a reminder, in the first six months of 2014 the Division

Sales
in millions of Swiss francs

recognised a one-off gain of CHF 38 million in the Flavour
Division on the disposal of land at its Dübendorf facility
in Switzerland.

CHF

1,161 million

Flavour Division sales

The operating income increased by 5.7% to CHF 247 million
in 2015 from CHF 234 million for the same period in 2014.
The operating margin increased to 21.3% in 2015 from 20.2%
in 2014.

Operating income
in millions of Swiss francs

EBITDAain millions of Swiss francs

1,178
1,161
1,157

322

310

247

234

256
184

2013

2014

2015

2013

a) EBITDA: Earnings Before Interest (and other financial income (expense), net),
Tax, Depreciation and Amortisation. This corresponds to operating income
before depreciation, amortisation and long-lived assets.

10 – Half Year Report 2015 – Givaudan SA

2014

2015

2013

2014

2015

Asia Pacific

Latin America

Sales in Asia Pacific increased 1.5% on a like-for-like basis.
New wins and existing business expansion in the developing
markets of China and India contributed to the growth.
The mature and developing markets showed an improved
momentum in the second quarter. Dairy and Snacks
strengthened with solid growth from new wins.

Growth in Latin America was 6.9% on a like-for-like basis withstrong growth in Argentina and Brazil. New wins and existing
business growth in Beverage, Dairy, Savoury and Sweet
Goods led the way.

Europe, Africa and Middle East
Sales increased 0.2% on a like-for-like basis, driven by solid
growth in the mature markets of Western Europe, notably
France, Germany, Spain and the UK. Challenging economic
conditions continue to negatively impact sales in theemerging markets of Eastern Europe, Africa and the Middle
East. Dairy, Savoury and Snacks increased as a result of new
wins and existing business growth.

North America
Sales increased 6.1% on a like-for like basis. The strong
performance carried forward from the first quarter as
double-digit growth was achieved in the segments ofBeverage and Dairy with moderate growth coming fromSnacks. Growth from existing business as well as new wins
contributed to the increase.

Givaudan SA – Half Year Report 2015 – 11

Half year
financial report

In this section:
14

I nterim condensed consolidated financial
statements

19

Notes to the interim condensed consolidated
financial statements

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

2015

2014

Sales

in millions of Swiss francs, except for per share data

Note

2,184

2,191

Cost of sales(1,168)(1,171)Gross profit

1,016

1,020

as % of sales

46.5%

46.6%

Marketing and distribution expenses

(294)

(308)

Research and product development expenses

(183)

(198)

Administration expenses

(79)

(83)

Share of (loss)/profit of jointly controlled entities

(1)

(1)

Other operating income

6

36

42

Other operating expense

7

(67)

(50)

Operating income
as % of sales

428

422

19.6%

19.2%

Financing costs

8

(31)

(32)

Other financial income (expense), net

9

(16)

(14)

381

376

Income before taxes
Income taxes

10

Income for the period

(42)

(71)

339

305

Attribution
Income attributable to equity holders of the parent
as % of sales

339

305

15.5%

13.9%

Earnings per share – basic (CHF)

11

36.82

33.13

Earnings per share – diluted (CHF)

11

36.37

32.71

The notes on pages 19-24 form an integral part of these interim condensed financial statements (unaudited).

14 – Half Year Report 2015 – Givaudan SA

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

Note

Income for the period

2015

2014

339

305

Items that may be reclassified to the income statement
Available-for-sale financial assets
Movement in fair value, net

2

3(Gains) losses removed from equity and recognised in the consolidated income statement-(2)

Movement on income tax

10-

Cash flow hedges
Movement in fair value, net(4)(Gains) losses removed from equity and recognised in the consolidated income statement

6

6

-

1

Movement on income tax

10

(22)

Exchange differences arising on translation of foreign operations

Change in currency translation

(282)

11

10

4

1

49

(104)

10

(17)

28

Other comprehensive income for the period

(242)

(78)

Total comprehensive income for the period

97

227

97

227

Movement on income tax
Items that will not be reclassified to the income statement
Defined benefit pension plans
Remeasurement gains (losses)
Income tax relating to items that will not be reclassified to the income statement

Attribution
Total comprehensive income attributable to equity holders of the parent
The notes on pages 19-24 form an integral part of these interim condensed financial statements (unaudited).

Givaudan SA – Half Year Report 2015 – 15

Consolidated financial statements continued

Condensed consolidated statement of financial position
At period ended

in millions of Swiss francs

Note

30 June 31 December
2015
2014

Cash and cash equivalents

216

412

Derivative financial instruments

30

21

Derivatives on own equity instruments

6

10

Available-for-sale financial assets

71

64

Accounts receivable – trade

897

911

Inventories

732

771

Current tax assets

23

22

Other current assets

165

146

2,140

2,357

Current assets
Derivative financial instruments

1

Property, plant and equipment

1,327

1,430

Intangible assets

2,102

2,293

Deferred tax assets

218

258

Post-employment benefits plan assets

11

7

Financial assets at fair value through income statement

34

35

Jointly controlled entities

17

17

Other long-term assets

70

75

Non-current assets

3,780

4,115

Total assets

5,920

6,472

112

57

Short-term debt

12

Derivative financial instruments

8

19

Accounts payable – trade and others

392

423

Accrued payroll and payroll taxes

88

119

Current tax liabilities

58

82

Financial liability: own equity instruments

80

54

Provisions

8

12

Other current liabilities

123

155

Current liabilities

869

921

Derivative financial instruments

54

50

1,154

1,150

Long-term debt

12

Provisions

46

36

Post-employment benefits plan liabilities

625

735

Deferred tax liabilities

85

88

Other non-current liabilities

64

79

2,028

2,138

2,897

3,059

Non-current liabilities
Total liabilities
Share capital

14

92

92

Retained earnings and reserves

14

5,065

5,187

Own equity instruments

15

(104)

(78)

Other components of equity(2,030)(1,788)Equity attributable to equity holders of the parent

3,023

3,413

Total equity

3,023

3,413

Total liabilities and equity

5,920

6,472

The notes on pages 19-24 form an integral part of these interim condensed financial statements (unaudited).

16 – Half Year Report 2015 – Givaudan SA

Consolidated financial statements continued

Condensed consolidated statement of changes in equity
For the six months ended 30 June2015
in millions of Swiss francs

Note

Balance as at 1 January

Retained
Share earnings andreserves
Capital92

Income for the period

5,187

Own equity
instruments

Cash flow
hedgesAvailablefor-salefinancialassets

(78)

(67)

22

(1,195)

(548)

3,413

2

2

(278)

32

(242)

2

2

(278)

32

97

Total comprehensive income for theperiodTotalequity339

339

Dividends paid

14

Movement on own equity instruments, net

15

(461)

Net change in other equity items
Balance as at 30 June

92

Note

Balance as at 1 January

92

(461)
(26)

(26)

(461)

(26)

(487)

5,065

(104)

Retained
Share earnings andreserves
CapitalIncome for the period

5,057

(65)

24

(1,473)

(516)

3,023

Own equity
instruments

Cash flow
hedgesAvailablefor-salefinancialassetsCurrencytranslationdifferences

Defined benefit
pension plans
remeasurement

Total
equity

(70)

(34)

20

(1,353)

(289)

3,423

(15)

1

12

(76)

(78)

(15)

1

12

(76)

305

305

Other comprehensive income for the period
Total comprehensive income for theperiod305

Dividends paid

14

Movement on own equity instruments, net

15

(433)

Net change in other equity items
Balance as at 30 June

Defined benefit
pension plans
remeasurement

339

Other comprehensive income for the period

2014
in millions of Swiss francs

Currencytranslationdifferences

92

227
(433)

(28)

(28)

(433)

(28)

(461)

4,929

(98)

(49)

21

(1,341)

(365)

3,189

The notes on pages 19-24 form an integral part of these interim condensed financial statements (unaudited).

Givaudan SA – Half Year Report 2015 – 17

Consolidated financial statements continued

Condensed consolidated cash flow statement
For the six months ended 30 Junein millions of Swiss francs

2015

2014

Income for the period
Income tax expense
Interest expense
Non-operating income and expense
Operating income

339
42
23
24
428

305
71
26
20
422

Depreciation of property, plant and equipment
Amortisation of intangible assets
Impairment of long-lived assets
Other non-cash items- share-based payments- pension expense- additional and unused provisions, net- other non-cash items
Adjustments for non-cash items

54
80
4

54
86
-

16
(10)
16
22
182

18
20
12
(37)
153

(Increase) decrease in inventories(Increase) decrease in accounts receivable(Increase) decrease in other current assets
Increase (decrease) in accounts payable
Increase (decrease) in other current liabilities(Increase) decrease in working capital

(20)
(87)
(36)
6
(41)
(178)

(53)
(72)
(90)
(16)
(16)
(247)

Income taxes paid

(51)

(49)

Pension contributions paid
Provisions used
Purchase and sale of own equity instruments, net
Impact of financial transactions on operating, net
Cash flows from (for) operating activities

(27)
(6)
(12)
5
341

(32)
(8)
(9)
(12)
218

200
(127)
306
(300)
(19)
(461)
(6)
(3)
(410)

450

Increase in long-term debt
(Decrease) in long-term debt
Increase in short-term debt
(Decrease) in short-term debt
Interest paid
Distribution to the shareholders paid
Purchase and sale of derivative financial instruments financing, net
Others, net
Cash flows from (for) financing activities

Note

12
12
12
12
14

(57)
(17)
(3)

119
(482)
(29)
(433)
(18)
(2)
(395)

Acquisition of property, plant and equipment
Acquisition of intangible assets
Increase in share capital of jointly controlled entities
Acquisition of subsidiary, net of cash acquired
Proceeds from the disposal of property, plant and equipment
Interest received
Purchase and sale of available-for-sale financial assets, net
Others, net
Cash flows from (for) investing activities

1
(5)
4
(77)

(46)
(21)
(1)
(33)
56
1
5
(1)
(40)

Net increase (decrease) in cash and cash equivalents

(146)

(217)

Net effect of currency translation on cash and cash equivalents
Cash and cash equivalents at the beginning of the period

(50)
412

(3)
513

Cash and cash equivalents at the end of the period

216

293

The notes on pages 19-24 form an integral part of these interim condensed financial statements (unaudited).

18 – Half Year Report 2015 – Givaudan SA

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

3. Accounting policies

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.

The accounting policies adopted are consistent with those of
the annual financial statements for the year ended
31 December 2014, as described in the 2014 consolidated
financial statements for the year ended 31 December 2014,
with the exception of the adoption as of 1 January 2015 of thestandards and interpretations described below:

Givaudan is a leading supplier of creative fragrance and flavour
products to the consumer goods industry. It operates in over
100 countries and has subsidiaries and branches in more than
40 countries. Worldwide, it employs 9,750 people.

•

Amendments to IAS 19 Employee benefits: Defined Benefit
Plans: Employee Contributions

The Group is listed on the SIX Swiss Exchange (GIVN).

•

Annual Improvements to IFRSs 2010-2012 Cycle (except for
the amendment to IFRS 3 Business combinations)

2. Basis of preparation of financial statements•

Annual Improvements to IFRSs 2011-2013 Cycle

These financial statements are the unaudited interim
condensed consolidated financial statements (hereafter ‘‘theinterim financial statements’’) of the Group for the six month
period ended 30 June 2015 (hereafter ‘‘the interim period’’).
They have been prepared in accordance with International
Accounting Standard 34 ‘‘Interim Financial Reporting’’.
The interim financial statements include the operations ofGivaudan SA and its controlled subsidiaries where control isdefined 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 2014 consolidated financial statements
as they provide an update of the most recent financial
information available.
Income tax expense is recognised based on management’s
best estimate of the weighted average annual income tax rate
expected for the full financial year.
The Group operates in markets where no significant seasonalor cyclical variations in sales are experienced during thefinancial year.
These interim financial statements are not audited. The
31 December 2014 statement of financial position has
been derived from the audited 2014 consolidated financial
statements. Givaudan SA’s Board of Directors approved theseinterim financial statements on 15 July 2015.

The Group assessed that the adoption of the above standards
does not affect the information already disclosed by the Group.

4. Fair value measurements recognised in thestatement of financial position
Available-for-sale financial assets, corporate owned life
insurance, and derivative assets and liabilities are the only
items measured at fair value subsequent to their initialrecognition.
Available-for-sale financial assets of CHF 71 million(31 December 2014: CHF 64 million) were measured with Level
1 inputs whereas CHF 39 million (31 December 2014:
CHF 41 million) were measured with Level 2 inputs. Corporate
owned life insurance of CHF 34 million (31 December 2014:
CHF 35 million) were measured with Level 2 inputs.
Derivative assets of CHF 31 million (31 December 2014:
CHF 21 million) and derivative liabilities of CHF 62 million(31 December 2014: CHF 69 million) were measured with Level
2 inputs. Derivative assets and liabilities consist of forward
foreign exchange contracts that are measured using quoted
forward exchange rates and yield curves derived from quoted
interest rates matching maturities of the contracts, and ofinterest 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 Level 1 and Level 2 categories
in the period. The Group did not carry out any transactions
on Level 3 inputs during and at the period presented in theseinterim financial statements.

Givaudan SA – Half Year Report 2015 – 19

Notes to the consolidated financial statements continued

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

Flavours

Group

2015

2014

2015

2014

2015

2014

Segment sales
Less inter segment sales a

1,023
-

1,034
-

1,167
(6)

1,162
(5)

2,190
(6)

2,196
(5)

Segment sales to third parties

1,023

1,034

1,161

1,157

2,184

2,191

EBITDA
as % of sales

244
23.8%

252
24.3%

322
27.8%

310
26.8%

566
25.9%

562
25.6%

Depreciation
Amortisation
Impairment of long-lived assets

(25)
(37)
(1)

(26)
(38)
-

(29)
(43)
(3)

(28)
(48)

(54)
(80)
(4)

(54)
(86)
-

Acquisition of property, plant and equipment
Acquisition of intangibles

32
8

19
10

25
9

27
11

57
17

46
21

Capital expenditures

40

29

34

38

74

67

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

Reconciliation table to Group’s operating income
Fragrances

Flavours

Group

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

2015

2014

2015

2014

2015

2014

EBITDA
Depreciation
Amortisation
Impairment of long-lived assets

244
(25)
(37)
(1)

252
(26)
(38)
-

322
(29)
(43)
(3)

310
(28)
(48)

566
(54)
(80)
(4)

562
(54)
(86)
-

181
17.7%

188
18.1%

247
21.3%

234
20.2%

428
19.6%

422
19.2%

(31)
(16)

(32)
(14)

381
17.4%

376
17.1%

Operating income
as % of sales
Financing costs
Other financial income (expense), net
Income before taxes
as % of sales

20 – Half Year Report 2015 – Givaudan SA

Notes to the consolidated financial statements continued

Classification of amortisation expense is as follows:
Fragrances
For the six months ended 30 June, in millions of Swiss francs

Cost of sales
Marketing and distribution expenses
Research and product development expenses
Other operating expense
Total

Flavours

Group

2015

2014

2015

2014

2015

2014

4
8
6
19
37

1
7
12
18
38

1
8
14
20
43

1
8
20
19
48

5
16
20
39
80

2
15
32
37
86

2015

2014

-

38

6. Other operating income
For the six months ended 30 June, in millions of Swiss francs

Gains on fixed asset disposals
Other income

36

4

Total other operating income

36

42

In the first six months of 2015 the Group recognised a one-off non-cash gain of CHF 32 million following a change in the pension plans.

7. Other operating expense
For the six months ended 30 June, in millions of Swiss francs

Amortisation of intangible assets

Note

2015

2014

5

39

37

Impairment of long-lived assets

4

Losses on fixed asset disposals

1

2

Acquisition related costs-

1

Other expenses
Total other operating expense

13

23

10

67

50

8. Financing costs
For the six months ended 30 June, in millions of Swiss francs

2015

2014

Interest expense

23

26

Net interest related to defined benefits pension plan86

Derivative interest (gains) losses

(1)

(1)

Amortisation of debt discounts

1

1

Total financing costs

31

32

Givaudan SA – Half Year Report 2015 – 21

Notes to the consolidated financial statements continued

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

2015

2014

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

(53)

(2)

Exchange (gains) losses, net

65

18

-

(3)

Gains from available-for-sale financial assets
Realised gains from available-for-sale financial assets removed from equity-(2)

Unrealised (gains) losses from fair value through income statement financial instruments

(1)

(1)

Interest income

(1)

(1)

Capital taxes and other non business taxes

5

4

Other (income) expense, net

1

1

Total other financial (income) expense, net

1614

10. Income taxes
The interim period income tax expense as a percentage of income before taxes was 11%, considerably lower than in 2014 followingchanges in Swiss Accounting Law and the Group’s operating structure. Excluding these items, the income taxes as a percentage ofincome before taxes was 19%.

11. 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:
Income attributable to equity holder of the parent (CHF million)

2015

2014

339

305

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

9,233,586 9,233,586(26,986)(28,213)

9,206,600 9,205,373
36.82

33.13

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:
Income attributable to equity holder of the parent (CHF million)
Weighted average number of shares outstanding for diluted earnings per share of 114,548(2014: 120,070)
Diluted earnings per share (CHF)

22 – Half Year Report 2015 – Givaudan SA

2015

2014

339

305

9,321,148 9,325,443
36.37

32.71

Notes to the consolidated financial statements continued

12. Debt
2015
in millions of Swiss francs

Within1 to 3 years

Within3 to 5 years

Thereafter

Total
Short-termlong-term within 1 year

Total

Floating rate debt
Bank facility

75

75Bank overdrafts
Total floating rate debt

75

75

75
5

5

5

80

Fixed rate debt
Bank borrowings
Straight bonds

56
448

Private placements

398

846

56
846

37

196

233

51

284

Total fixed rate debt

448

37

594

1,079

107

1,186

Balance as at 30 June

448

112

594

1,154

112

1,266

Within1 to 3 years

Within3 to 5 years

Thereafter

Total
Short-termlong-term within 1 year

Total

2014
in millions of Swiss francs

Floating rate debt
Bank facility
Bank overdrafts

3

3

Total floating rate debt

3

3

Fixed rate debt
Bank borrowings

2

1

Straight bonds

149

298

398

3

4

845

7
845

Private placements

55

247

302

50

352

Total fixed rate debt

206

299

645

1,150

54

1,204

Balance as at 31 December

206

299

645

1,150

57

1,207

In March 2015, Givaudan SA issued a tranche of CHF 200 million of the multilateral facility (maturity July 2018), of which
CHF 75 million was reimbursed in April 2015 and CHF 50 million in June 2015.
On 28 May 2015, Givaudan United States, Inc. reimbursed a USD 50 million (CHF 47 million) private placement made on 28 May
2003, with an annual interest rate of 5.00%.

Givaudan SA – Half Year Report 2015 – 23

Notes to the consolidated financial statements continued

13. Provisions

16. Contingent liabilities

Givaudan’s affiliate, Givaudan Fragrances Corporation, is one ofmore than 100 companies identified by the US Environmental
Protection Agency (‘‘EPA’’) as ‘‘Potentially Responsible Parties’’
for alleged contamination within the lower 17-mile stretchof the Passaic River. EPA released a Focused Feasibility Study(‘‘FFS’’) covering only the lower eight miles of the river in 2014,
which contains several potential options for future remediationof that portion of the river. The Cooperating Parties Group,of which Givaudan is a member, has issued a draft Remedial
Investigation/Feasibility Study which proposes a Sustainable
Remedy for the entire lower 17 miles of the river. To date, the
EPA has not selected the remedy for the river.

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 alreadyrecovered or will recover amounts it is entitled to under theterms of its insurance policies.

At this time, there are many uncertainties associated with thefinal remediation plan and the Company’s share of the costs,
if any. However, in accordance with accounting guidance,
the Company has recorded a reserve which it believes canreasonably be expected to cover the Company’s obligation, if
any, given the information currently available.

14. Equity
At the Annual General Meeting held on 19 March 2015 the
distribution of an ordinary dividend of CHF 50.00 per share(2014: ordinary dividend of CHF 47.00 per share) was approved.
The dividend payment has been made out of the additional paidin capital reserve.
At 30 June 2015, the share capital amounts to CHF 92,335,860,
divided into 9,233,586 fully paid-up registered shares with anominal value of CHF 10.00 each. Each share gives the right toone vote.

15. 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 and share option plans. At 30 June 2015,
the Group held 21,706 own shares (2014: 27,872), as well asderivatives on own shares equating to a long position of 65,288(2014: 21,735).

24 – Half Year Report 2015 – Givaudan SAGivaudan SA
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T + 41 22 780 90 53
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Investor Calendar
Givaudan will announce its 2020 strategy on 27 August 2015 at 07:00 CETHalf year conference, Zurich: Thursday, 27 August 2015
Nine month sales results: Friday, 9 October 2015
Full year results: Tuesday, 2 February 2016
Annual General Meeting: Thursday, 17 March 2016
Dates may be subject to change, please consult the calendar
on the Givaudan website:www.givaudan.com/investors/shareholder-information/investor-calendar

The Givaudan 2015 Half year report is published on www.givaudan.com in English,
German and French.
The Givaudan 2015 Half year financial Report is published on www.givaudan.com in
English.
All trademarks mentioned enjoy legal protection.

This Half year and financial report may contain forward-looking information. Suchinformation 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, 2015