12020 Half Year Report2020 guidance
confirmed

Givaudan – 2020 Half Year Report2Creating for happier,healthier lives, withlove for nature.
Let’s imagine together.
Givaudan is committed todriving responsible, longterm growth while leading
the way to improve happinessand health for people andnature.
With a heritage stretching back over 250 years, wehave a long history of innovating scents and tastes,
and are proud to be the industry leader, withapproximately 25% of market share of the fragrance
and flavour industry.
Together with our customers in the food, beverage,
consumer goods and fragrance and cosmetics
industries, we create products that delight consumers
the world over. With a passion to understandconsumer preferences and a relentless drive toinnovate, we are at the forefront of creating scentsand tastes that touch consumers’ emotions.

Table of contents

Givaudan – 2020 Half Year Report03

At a glance

05

Business performance

07

Fragrance Division08

Flavour Division09

Half Year Financial Report3 - At a glance

At a glanceFirst half of 2020
Key Figures
For the six months ended 30 June, in millions of Swiss francs, except for earnings per share data

2020

2019

Percentagechange4.1%

Group sales

3,221

3,094

Fragrance sales

1,456

1,361

7.0%

Flavour sales

1,765

1,733

1.9%

Like-for-like sales growth

4.0%

6.3%

Gross profit

1,359

1,274

as % of sales

42.2%

41.2%

EBITDA a734

660

as % of sales

22.8%

21.3%

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

532

491

16.5%

15.9%

413

380

12.8%

12.3%

359

271

11.1%

8.8%

Free cash flow b

178

148

as % of sales

5.5%

4.8%

Earnings per share − basic (CHF)

44.81

41.24

6.7%
11.3%
8.4%
8.8%
32.5%
20.3%
8.7%

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 Junein millions of Swiss francs

2019
Sales
as reported

like-for-likedevelopment

2020
Change %Sales on like-for-like
like-for-likebasis

Acquisition
impact (net)Currency
effects

2020
Sales
Change %as reported in Swiss francs

Group

3,094

125

3,219

4.0%

194

(192)

3,221

4.1%

- Fragrance

1,361

62

1,423

4.5%

127

(94)

1,456

7.0%

- Flavour

1,733

63

1,796

3.6%

67

(98)

1,765

1.9%

2020
Change %Sales on like-for-like
like-for-likebasis

Acquisition
impact (net)Currency
effects

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

2019
Sales
as reported

like-for-likedevelopment

2020
Sales
Change %as reported in Swiss francs

Mature markets

1,802

9

1,811

0.5%

128

(71)

1,868

3.4%

High growth markets

1,292

116

1,408

9.0%

66

(121)

1,353

5.1%

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

Givaudan – 2020 Half Year Report4 - At a glance

At a glance“Our strong performance in the first half of 2020 demonstrates ourmarket leadership and the important role that we play in sustaining
the global supply chain in food and beverage as well as in household,health and personal care products,” said CEO Gilles Andrier. “I am very
proud of the entire Givaudan organisation for their dedication during
this challenging period and for enabling us to continue to support ourcustomers to keep critical products available to consumers throughout
the COVID-19 crisis.”

Performance summary
•
•
•
•
•

Strong financial performance in a very challenging environment related to COVID-19 pandemic
Global Manufacturing and supply chain sustained with minimal disruption
Both divisions and all geographical regions contributed to the good growth
Strong sales growth in those product categories which were not impacted by the COVID-19
pandemic
Strategic focus areas and acquired companies continuing to contribute positively

Building on our capabilities
•
•
•

•

Strengthening our speciality ingredient capabilities and our leadership in the fast growing local
and regional customer segment with the acquisition of Ungerer
The announcement to acquire Alderys is part of our long-term strategy to expand ourcapabilities in bio-engineering technologies
The acquisition of the cosmetic ingredients business of Indena further enables sustainable value
creation and strengthens our global Active Beauty capabilities in botanical active cosmetic
ingredients
Partnership with start-up company Kaffe Bueno brings innovative facial skin care benefits to
consumers through the launch of Koffee’Up ™, a scientifically proven premium coffee oil crafted
using upcycling techniques

Looking towards the future•
Delivery of 2020 guidance is fully on track•
Continued integration of acquired companies on to our operating platforms•
GBS almost fully implemented across the Company: GBS delivery centres working effectively
within the broader Givaudan organisation•
Finalising our strategic roadmap for 2021-2025 in line with the Company’s purpose

Givaudan – 2020 Half Year Report5 - Business performance - Group

Business performance
Strong financial performance

Business performance

Givaudan Group sales for the first six months of the year were
CHF 3,221 million, an increase of 4.0% on a like-for-like basis and4.1% in Swiss francs.
Fragrance Division sales were CHF 1,456 million, an increase of
4.5% on a like-for-like basis and 7.0% in Swiss francs.
Flavour Division sales were CHF 1,765 million, an increase of
3.6% on a like-for-like basis and 1.9% in Swiss francs.
As the COVID-19 pandemic continues to have an impact on a
global level, Givaudan sustained strong business momentum
whilst maintaining its operations and global supply chain withminimal disruption. The good growth was achieved across mostproduct segments and geographies, with particularly strong
performance in household, health and personal care segments
within the Fragrance division, as well as in packaged foods,
savoury, snacks and nutraceuticals in the Flavour division. In the
product segments most affected by the COVID-19 pandemic,
namely Fine Fragrance and to a lesser extent Active Beauty in
the Fragrance division and Foodservice in the Flavour division,
the Group experienced a significant reduction in businessactivity in the months from March through June, as the
restrictions related to the COVID-19 pandemic restricted retailand travel retail activity as well as out-of-home foodconsumption.

Group sales
in millions of Swiss francs

2020

3,221

2019

3,094

2018

2,674

2017

2,483

2016

2,334

Gross profit

The gross profit increased by 6.7% from CHF 1,274 million in2019 to CHF 1,359 million in 2020. Due to continued productivity
gains and cost discipline, the gross margin increased to 42.2% in2020 compared to 41.2% in 2019.

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

The EBITDA increased by 11.3% to CHF 734 million from CHF 660
million for the same period in 2019, whilst the EBITDA margin
was 22.8% in 2020 compared to 21.3% in 2019. On a comparable
basis, the EBITDA margin was 23.7% in 2020 compared to 22.3%
in 2019.
In 2020, the Group incurred costs of CHF 4 million in relation to
the implementation of the Givaudan Business Solutionsorganisation, compared with CHF 19 million in 2019.

In the continuing challenging environment related to the
COVID-19 crisis and in line with the Company’s purpose,
Givaudan is strongly focused on:Group EBITDA
in millions of Swiss francs•

Protecting and supporting its employees. Be it those onsite or those who are still working from home;

2020

734

2019

660

Meeting the demands of its customers. Particularly for
those products which support consumers throughout the
pandemic around the world;

2018

601

2017

597

2016

638

•

•

Taking care of the communities in which it operates. In
the early stages of the COVID-19 pandemic, the Company
established the Givaudan COVID-19 Communities Fund toenable Givaudan sites to support local communities thatare being affected around the world. Givaudan committed
to donate at least CHF 1 million to this fund and to date,over 120 initiatives across 40 countries have beenlaunched.

Givaudan – 2020 Half Year Report

Operating income

The operating income increased to CHF 532 million, comparedto CHF 491 million in 2019. When measured in local currency
terms, the operating income increased by 18.9%. The operating
margin increased to 16.5% in 2020 from 15.9% in 2019.

6 - Business performance - Group

Group operating income
in millions of Swiss francs
2020

532

2019

491

2018

489

2017

489

2016

500

Financial performance

Financing costs were CHF 39 million in the first half of 2020,
versus CHF 36 million for the same period in 2019, largely related
to the increase in net debt of the Group in connection with therecent acquisitions. Other financial expense, net of income, was
CHF 13 million in 2020 versus CHF 18 million in 2019.

Operating cash flow after net investments was CHF 220 million
versus CHF 177 million recorded in 2019, an increase of 24.3%.
Free cash flow was CHF 178 million in the first half of 2020,
versus CHF 148 million for the comparable period in 2019, an
increase of 20.3%. As a percentage of sales, free cash flow in thefirst six months of 2020 was 5.5%, compared to 4.8% in 2019.

Financial position

Givaudan’s financial position remained solid at the end of June
2020. Net debt at June 2020 was CHF 4,631 million, up from
CHF 3,679 million at December 2019, with the increase driven by
the acquisition of Ungerer in the first quarter of 2020. The
leverage ratio was 56% compared to 47% at the end of 2019.

2020 guidance:
Responsible growth. Shared success

Net income

The Company’s 2020 ambition is to create further value
through profitable, responsible growth. Building on the first
four 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’.

Cash flow

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 sixteen acquisitions, which are fully in line withthe growth pillars within the Company’s 2020 strategy.

Net Working capital was 27.9% of sales compared to 27.3%
in 2019, with temporarily higher accounts receivable andinventory levels related to the COVID-19 pandemic.

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 interim period income tax expense as a percentage of income
before taxes was 14% in 2020, compared with 13% for the same
period in 2019.

The net income for the first six months of 2020 was CHF 413
million compared to CHF 380 million in 2019, an increase of
8.8%, resulting in a net profit margin of 12.8% versus 12.3% in
2019. Basic earnings per share were CHF 44.81 versus CHF 41.24
for the same period in 2019.

Givaudan delivered an operating cash flow of CHF 359 million
for the first six months of 2020, compared to CHF 271 million
in 2019.

Total net investments in property, plant and equipment were
CHF 122 million, compared to CHF 77 million in 2019, as theGroup continues to invest in expanding its capabilities in highgrowth markets. As a reminder, in 2018 the Group completed anagreement to sell and leaseback the Zurich Innovation Centre(ZIC) for a total consideration of CHF 173 million, of which
CHF 60 million was received in the first six months of 2019.
Intangible asset additions were CHF 17 million in 2020,
compared to CHF 17 million in 2019, as the Company continues
to invest in its IT platform capabilities.
Total net investments in tangible and intangible assets were
4.3% of sales, compared to 3.0% in 2019. Excluding the impactof the ZIC transaction, total net investments in tangible andintangible assets in 2019 would have been 4.6% of sales.

Givaudan – 2020 Half Year Report

Givaudan’s purpose

The Company’s purpose, ‘Creating for happier, healthier lives
with love for nature. Let’s imagine together’, is at the heart ofits strategy. Under the purpose, Givaudan has defined bold
and ambitious goals in four domains, namely creations,nature, people and communities. These ambitions include
doubling its business through creations that contribute tohappier, healthier lives by 2030, becoming climate positive
before 2050, becoming a leading employer for inclusion
before 2025 and sourcing all materials and services in a waythat protects the environment and people by 2030.

Note: Definitions and further information and reconciliations of the Group’s
Alternative Performance Measures can be found in the Appendix ‘Alternative Performance Measures’ pages 24-25.

7 - Business performance: - Fragrance Division

Fragrance Division
Fragrance sales

Fragrance Division sales were CHF 1,456 million, an increase of
4.5% on a like-for-like basis and an increase of 7.0% in Swiss francs
over 2019. Sales growth was driven by the particularly strong
volume growth of the consumer products business unit, despite
the impact on Fine Fragrances related to the COVID-19 pandemic.
Total sales for Fragrance Compounds (Fine Fragrances andConsumer Products combined) increased by 5.3% on a like-for-likebasis. In Swiss francs, sales of compounds increased to CHF 1,252
million from CHF 1,171 million in 2019.
Fine Fragrance sales decreased by 16.4% on a like-for-like basis
driven by a significant reduction of activity in retail stores andtravel retail related to COVID-19. After a strong start to the year,
driven by new wins and existing products, the months of Marchthrough June experienced a strong reduction in demand as the
COVID-19 pandemic severely restricted traditional retail channels
in the major Fine Fragrance markets.
Consumer Products sales increased by 11.8% on a like-for-like basis,
against 8.7% for the same period in 2019, with strong demand forhousehold, health and personal care products related to
COVID-19. The excellent growth was delivered in both highgrowth and mature markets and was spread across all customer
groups and regions.
Sales of Fragrance Ingredients and Active Beauty were almost flatwith a reported reduction of 0.1% on a like-for-like basis, against astrong comparable growth of 8.2% in 2019.
The EBITDA of the Fragrance Division increased to CHF 333 million
in 2020 compared to CHF 270 million for the first six months of
2019. The increase was mainly driven by higher sales, thecontribution of the recent acquisitions and the result of theactions taken to contain operating expenses. The EBITDA marginincreased to 22.9% in 2020 from 19.8% in 2019. On a comparable
basis the EBITDA margin of the Fragrance Division was 23.4% in2020 compared to 21.3% in 2019.
In the first six months of 2020 the division incurred costs
associated with the GBS project of CHF 4 million, compared to
CHF 19 million in 2019.
The operating income increased by 23.8% to CHF 264 million in
2020, versus CHF 213 million for the same period in 2019. The
operating margin increased to 18.2% in 2020 from 15.7% in 2019.

Fine Fragrances

Fine fragrance sales decreased by 16.4% on a like-for-like basis
against a strong comparable of 8.5% growth in 2019. These
results were impacted by the COVID-19 outbreak driving highGivaudan – 2020 Half Year Report

Fragrance Division sales
in millions of Swiss francs
2020

1,456

2019

1,361

2018

1,223

2017

1,137

2016

1,132

levels of business erosion across all customer groups and regions
due to the restricted activities in retail and travel retail channels.
On a regional basis, sales performance in Western Europe wasnegatively impacted by the overall slowdown in demand from
customers, while sustained levels of new business wins in North
America were offset by established volume decline. In thehigh-growth markets, double-digit sales growth in Latin
America was offset by weaker performance in Asia and the
Middle East.

Consumer Products

Consumer Products sales increased by 11.8% on a like-for-likebasis with excellent growth across all customer groups andgeographies, supported by increased consumption of household,health and personal care products related to COVID-19.
On a regional basis, Latin America reported double-digit growthacross all customer groups and most sub-regions. Asia recorded
good growth led by strong double-digit growth with local andregional customers. Europe, Africa and the Middle East delivered
double-digit sales increase across all product segments led by
local and regional customers, as well as strong double-digit
growth in the African and Middle East sub-region. North America
posted double-digit growth spread across all products segmentswith strong performance of international customers.
On a product segment basis, sales growth was led by doubledigit growth in Home Care and Fabric Care, followed by solid
performance in Personal Care.

Fragrance Ingredients and Active Beauty

Sales of Fragrance Ingredients and Active Beauty were almost flatwith a reported decline of 0.1% on a like-for-like basis, against astrong comparable growth of 8.2% in 2019. Active Beauty
performed relatively well in difficult market conditions related to
COVID-19, with a minimal sales reduction thanks to its wellbalanced portfolio of products and customers. Fragrance
Ingredients experienced a moderate single digit growth driven by
Local & Regional customers.

8 - Business performance: - Flavour Division

Flavour Division
Flavour sales

Flavour Division sales were CHF 1,765 million, an increase of
3.6% on a like-for-like basis and 1.9% in Swiss francs.
The sales performance was driven by both new wins andexisting products with strong business momentum across all
regions coming from both Global and Local and Regionalcustomers. The key strategic focus areas of the 2020 strategy,
namely Health and Well-Being and Naturals grew at doubledigit and single-digit levels respectively.
Linked to the COVID-19 pandemic, the Flavour divisions
experienced a shift in demand from Foodservice and alcoholic
beverages into established products in categories such as Juice
Based Beverages, Culinary Solutions, Nutritional Bars, Savoury
and Snacks.
From a segment perspective Dairy, Sweet Goods, Savoury andSnacks were the main contributors to the division growth.
The EBITDA increased to CHF 401 million from CHF 390 million
in 2019, an increase of 2.8%, with continuing productivity gains
and cost discipline contributing to the increase. The EBITDA
margin was 22.7% in 2020, up from 22.5% in 2019. On a
comparable basis the EBITDA margin of the Flavour Division
was 23.8% in 2020 compared to 23.1% in 2019.

Flavour Division sales
in millions of Swiss francs
2020

1,765

2019

1,733

2018

1,451

2017

1,346

2016

1,202

Europe, Africa and Middle East

Sales in Europe, Africa and the Middle East increased by 3.4%
on a like-for-like basis. In the high-growth markets of Africa
and the Middle East, double-digit growth was achieved inAlgeria, Egypt and Cameroon followed by the Middle Eastwith good single-digit growth. Growth in Central andEastern Europe was led by Russia and Turkey. In the mature
markets of Western Europe, we saw very good momentum
driven by France, the Netherlands, Belgium and Sweden.
The growth was driven by the Dairy, Savoury and Snacks
segments.

North America

The operating income decreased to CHF 268 million in 2020
from CHF 278 million in 2019, a decrease of 3.5%. The operating
margin was 15.2% in 2020 compared to 16.0% in 2019.

On a like-for-like basis, sales in North America increased by
2.8% driven by the good performance of global and local andregional Customers. From a segment perspective good
growth was achieved in Beverages, Snacks and Sweet Goods.

Asia Pacific

Latin America

Sales in Asia Pacific grew by 2.4% on a like-for-like basis,
against a comparable growth of 6.2% in 2019. The highgrowth markets of Thailand and China delivered strong
double-digit performance, whilst India, Indonesia andMalaysia were heavily impacted by the COVID-19 crisis.
In the mature markets, growth was driven by Japan,
Korea and Singapore.
From a customer perspective in Asia Pacific, there was a shift
towards Global and International customers, which were less
impacted by the COVID-19 crisis compared to Local andRegional customers. From a segment perspective, Savoury,
Snacks and Sweet Goods contributed significantly to thegrowth.

Givaudan – 2020 Half Year Report

Sales in Latin America increased by 10.6% on a like-for-likebasis, against a strong comparable of 22.8% growth in 2019.
The strong growth was achieved across all markets and in
the segments of Dairy, Beverage, Savoury and Sweet Goods.

9 - Financial statements

2020 Half Year
Financial Report

Table of contents:

Givaudan – 2020 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

2020

2019

6

3,221

3,094

Cost of sales(1,862)(1,820)Gross profit

1,359

1,274

as % of sales

42.2%

41.2%

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

Sales

Selling, marketing and distribution expenses

(412)

(373)

Research and product development expenses

(261)

(259)

Administration expenses

(104)

(109)

Share of results of joint ventures and associates

3

3

Other operating income

11

11

(64)

(56)

Other operating expense

7

Operating income
as % of sales

532

491

16.5%

15.9%

Financing costs

8

(39)

(36)

Other financial income (expense), net

9

(13)

(18)

Income before taxes

480

437

Income taxes

(67)

(57)

Income for the period

413

380

Attribution
Income attributable to non-controlling interests––

Income attributable to equity holders of the parent

413

380

as % of sales

12.8%

12.3%

Earnings per share − basic (CHF)

10

44.81

41.24

Earnings per share − diluted (CHF)

10

44.48

40.94

The notes on pages 15 to 23 form an integral part of these interim condensed financial statements (unaudited).

Givaudan – 2020 Half Year Report11 - Financial statements

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

2020

2019

Income for the period

413

380

Items that may be reclassified to the income statement
Cash flow hedges
Movement in fair value, net

(58)

(49)

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

33

Movement on income tax

7

4

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

46

22

(340)

(46)

(2)

(4)

Remeasurement gains (losses) of post-employment benefit obligations

39

(87)

Movement on income tax

(2)

(1)

Other comprehensive income for the period

(307)

(158)

Total comprehensive income for the period

106

222

Currency translation differences
Movement on income tax
Items that will not be reclassified to the income statement
Defined benefit pension plans

Attribution
Total comprehensive income attributable to non-controlling interests––

Total comprehensive income attributable to equity holders of the parent

106

222

The notes on pages 15 to 23 form an integral part of these interim condensed financial statements (unaudited).

Givaudan – 2020 Half Year Report12 - Financial statements

Condensed consolidated statement of financial position
At period ended

in millions of Swiss francs

Note 30 June 2020

31 December
2019

Cash and cash equivalents

432

452

Derivative financial instruments

4

32

24

Financial assets at fair value through income statement

4

4

4

Accounts receivable - trade

1,472

1,365

Inventories

1,336

1,149

Current tax assets

5250

Prepayments

49

35

Other current assets

135

163

3,512

3,242

Current assets
Derivative financial instruments–

1

Property, plant and equipment

2,229

2,326

Intangible assets

4,644

4,286

Deferred tax assets

221

211

Post-employment benefit plan assets

15

32

173

177

Interests in joint ventures and investments in associates

36

34

Other long-term assets

85

87

7,403

7,154

Financial assets at fair value through income statement

44Non-current assets
Total assets

10,915

10,396

Short-term debt

11

846

335

Derivative financial instruments

4

28

29

856

833

Accrued payroll and payroll taxes

156

189

Current tax liabilities

140

111

Financial liability - own equity instruments

133

108

Accounts payable - trade and others

Provisions

17

18

Other current liabilities

206

207

2,382

1,830

Current liabilities
Derivative financial instruments

4

130

79

Long-term debt

11

4,217

3,796

Provisions

75

69

Post-employment benefit plan liabilities

548

601

Deferred tax liabilities

329

280

Other non-current liabilities

71

82

5,370

4,907

7,752

6,737

Non-current liabilities
Total liabilities
Share capital

12

92

92

Retained earnings and reserves

12

5,803

5,961

Own equity instruments

13

(198)

(168)

Other components of equity(2,552)(2,245)Equity attributable to equity holders of the parent

3,145

3,640

Non-controlling interests

18

19

Total equity

3,163

3,659

Total liabilities and equity

10,915

10,396

The notes on pages 15 to 23 form an integral part of these interim condensed financial statements (unaudited).

Givaudan – 2020 Half Year Report13 - Financial statements

Condensed consolidated statement of changes in equity
For the six months ended 30 June2020
in millions of Swiss francs

Balance as at 1 January

Retainedearnings
Share Capital and reserves

92

Income for the period

5,961

Own equity
instruments

Cash flow
hedges

(168)

(107)

Remeasurement of post
Currency employmenttranslation
benefitdifferences
obligations(1,613)

(525)

413

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

413

Dividends paid

(571)

Movement on own equity
instruments, net

(48)

(296)

37

(48)

(296)

37

Equityattributable
to equity
holders of
the parents

Noncontrollinginterests

Total equity

3,640

19

3,659

413

–

413

(307)
106

(30)

Balance as at 1 January

92

(571)

(30)

5,803

(198)

(30)

Retainedearnings
Share Capital and reserves

92

Income for the period

5,811

(155)

Own equity
instruments

Cash flow
hedges

(142)

(61)

Total comprehensive
income for the period

380

Dividends paid

(552)

Movement on own equity
instruments, net

(601)

(1)

(602)

18

3,163

Remeasurement of post
Currency employmenttranslation
benefitdifferences
obligations

Equityattributable
to equity
holders of
the parents

Noncontrollinginterests

Total equity

3,710

22

3,732

380

–

380

(1,559)

(431)

(42)

(28)

(88)

(42)

(28)

(88)

(158)
222

92

–

(552)

(34)

5,639

(176)

(34)
–

–

22

3,368

(586)
(103)

(1,587)

(519)

3,346

222
(552)

(34)

The notes on pages 15 to 23 form an integral part of these interim condensed financial statements (unaudited).

Givaudan – 2020 Half Year Report

(158)

(552)
(34)

Net change in other equity
items

(1)

3,145

Non-controlling interests

Balance as at 30 June

(30)

(488)

(1,909)380

Other comprehensive
income for the period

106
(571)

(1)

Net change in other equity
items

2019
in millions of Swiss francs

–

(571)

Non-controlling interests

Balance as at 30 June

(307)

(586)

14 - Financial statements

Consolidated statement of cash flows
For the six months ended 30 Junein millions of Swiss francs

Note

Income for the period

2020

2019

413

380
57

Income tax expense

67

Interest expense3831

Non-operating income and expense

14

23

532

491

Operating income
Depreciation of property, plant and equipment

6

100

88

Amortisation of intangible assets

6

91

80

Impairment of long-lived assets

6

11

1

- share-based payments

24

18- pension expense24

19- additional and unused provisions, net

104- other non-cash items

–

(18)

Other non-cash items

Adjustments for non-cash items

260

192

(Increase) decrease in inventories

(184)

(180)

(Increase) decrease in accounts receivable

(170)

(137)

(Increase) decrease in other current assets

11

(13)

Increase (decrease) in accounts payable

100

131

Increase (decrease) in other current liabilities

(80)

(72)

(Increase) decrease in working capital

(323)

(271)

Income taxes paid

(54)

(63)

Pension contributions paid

(17)

(18)

Provisions used

(9)

(9)

Purchase and sale of own equity instruments, net

(30)

(51)

359

271

Cash flows from (for) operating activities
Increase in long-term debt

11

1,260

6

(Decrease) in long-term debt

11

(781)

(170)

Increase in short-term debt

11

2,616

1,296

(Decrease) in short-term debt

11

(2,091)(817)

Cash flows from debt, net
Interest paid
Purchase and sale of derivative financial instruments, net
Lease payments

11

Transactions of non-controlling interest

1,004

315

(14)

(10)

(15)

(2)

(28)

(19)

(1)

Other, net(8)–Cash flows from financial liabilities

938

284

Distribution to the shareholders paid

(571)

(552)

Cash flows from (for) financing activities

367

(268)

Acquisition of property, plant and equipment

(123)

(138)

Acquisition of intangible assets

(19)

(17)

(614)

(61)

Proceeds from the disposal of property, plant and equipment

1

61

Proceeds from sales of intangible assets

2

Acquisition of subsidiaries, net of cash acquired

125Interest received

3

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

2

Impact of financial transactions on investing, net

24

(17)

Other, net
Cash flows from (for) investing activities
Net increase (decrease) in cash and cash equivalents

3

1

(20)

(725)

(187)

1

(184)

Net effect of currency translation on cash and cash equivalents

(21)

–

Cash and cash equivalents at the beginning of the period

452

423

Cash and cash equivalents at the end of the period

432

239

The notes on pages 15 to 23 form an integral part of these interim condensed financial statements (unaudited).
Givaudan – 2020 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 15,847 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 2020 (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 2019 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 financial
year. The COVID-19 pandemic has not materially affected the business activities of the Group; thus the operating results as well as
the interim condensed consolidated financial statements for the six month period ended 30 June 2020 have not been materially
impacted.
The 31 December 2019 statement of financial position has been derived from the audited 2019 consolidated financial statements.
Givaudan SA’s Board of Directors approved these interim financial statements on 17 July 2020.

3. Accounting policies

The accounting policies adopted are consistent with those of the annual financial statements for the year ended 31 December 2019,as described in the 2019 consolidated financial statements with the exception of the adoption as of 1 January 2020 of the standards
and interpretation described below:
Amendments to IFRS 10 and IAS 28: Sales or Contribution of Assets between an Investor and its Associate or Joint Venture
clarify that in a transaction involving an associate or joint venture the extent of gain or loss recognition depends on whether theassets sold or contributed constitute a business. The adoption of these amendments has no impact on the accounting of the joint
arrangements currently held by the Group.
Definition of Material: Amendments to IAS 1 and IAS 8 align the definition used in the Conceptual Framework and thestandards themselves. The clarification does not impact the current practice of the Group.
Definition of Business: Amendments to IFRS 3 narrow and clarify the definition of a business. They also permit a simplified
assessment of whether an acquired set of activities and assets is a group of assets rather than a business. The amendments do not
impact the current practice of the Group.
Amendments to IFRS 9, IAS 39 and IFRS 7: Interest Rate Benchmark Reform provide certain reliefs in connection with interest
rate benchmark reform. The reliefs relate to hedge accounting and have the effect that IBOR reform should not generally cause
hedge accounting to terminate. The amendments do not impact the current practice of the Group.

Givaudan – 2020 Half Year Report16 - Financial statements

4. Financial risk management
Derivative financial instruments
The Group entered into several forward starting EUR interest rate swaps in 2020, in order to protect against future increases in the
EUR interest rate, while also fixing the interest rate on future debt issuance. The transactions have the following characteristics:

EntityIssue
date

Givaudan SA 2020

Typeof instrument

Forwardstarting
interest
rate swaps

Currencyofinstrument

EUR

Notional
amount in
millions

Annual fixedinterest rate
(payment)

25

0.390%

25

0.120%

50

0.499%

25

0.818%

25

0.510%

25

0.145%

25

0.304%

25

0.260%

Floating
rate(receipt)The
6 months
EUR Liborrate

Starting
date

Maturitydate

20 Dec2024

22 Dec2031

Private placement of
EUR 200 million, issued in Dec
2017 with a 7 year maturity

17 Sep2025

17 Sep2032

Public bond of
EUR 500 million, issued in Sep
2018 with a 7 year maturity

17 Sep2030

17 Sep2040

Public bond of
EUR 800 million, issued in Sep
2018 with a 12 year maturity

22 Apr2032

22 Apr2042

Public bond of EUR 500 million,
issued in Apr 2020 with a 12 year
maturity

Assigned to

In addition the Group entered into cross-currency swaps with the following characteristics:

EntityIssue
date

Givaudan SA 2020

Typeof
instrument

Crosscurrency
swaps

Notional
amount in
millions of
EUR

Notional
amount in
millions of
USD

Annual USD
fixed
interest rate
(payment)

2.218%

80

87.3

100

108.8

2.166%

80

86.9

2.167%

80

87.0

2.166%

90

97.9

2.133%

70

76.2

2.126%

Annual EUR
fixed
interest rate
(receipt)1%

Starting
date

Maturitydate

22 Apr
2020

22 Apr2027

Purpose of the instrument

Conversion of the EUR 500 million
public bond issued in April 2020
with a 7 year maturity into a USD
synthetic debt of USD 544 million

In 2020 the Group applied hedge accounting on the net investment in foreign currency in Ungerer (Note 5) with the aim of being
protected from the foreign currency risk on the translation of the investment in Ungerer (i.e. USD) into the Group’s presentation
currency (i.e. CHF). The combination of a Eurobond and cross-currency swap as one single item are designated as hedge
instrument for an amount of USD 544 million corresponding to the foreign currency principal cash flow of the cross-currency
swap. In the period ended 30 June 2020, it resulted in a gain of CHF 17 million recognised in currency translation differences inequity.
Fair value measurements recognised in the statement of financial position
Financial assets consisting of equity and debt securities of CHF 111 million (31 December 2019: CHF 112 million) were measured with
Level 1 inputs whereas CHF 32 million (31 December 2019: CHF 33 million) were measured with Level 2 inputs. Corporate owned life
insurance of CHF 34 million (31 December 2019: CHF 36 million) were measured with Level 2 inputs.

Givaudan – 2020 Half Year Report17 - Financial statements

Derivative assets of CHF 32 million (31 December 2019: CHF 25 million) and derivative liabilities of CHF 158 million(31 December 2019: CHF 108 million) were measured with Level 2 inputs. Derivative assets and liabilities consist of cross-currency
swaps and 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 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. The carrying amount of each class of financial assets andliabilities disclosed above approximates their fair value.

5. Acquisitions
Ungerer
On 20 February 2020 Givaudan acquired 100% of the share capital of Ungerer and its affiliates for a purchase price of CHF 676
million (USD 688 million). Headquartered in New Jersey, USA, Ungerer is a leading independent company in the flavour andfragrance specialty ingredients business, most notably in essential oils, which provides a rich palette of predominantly naturalingredients for flavour and fragrance creation, as well as for end customers of such specialties. Ungerer also has an impressive local
and regional customer presence for both flavours and fragrances in North America. Founded more than 125 years ago, Ungerer has
developed a strong market position in all segments and a high quality reputation with its customer base. With a presence in morethan 60 countries, a total of eight manufacturing facilities and six R&D centres, Ungerer’s capabilities and its 650 employees willfurther extend Givaudan’s market leadership in its core flavour and fragrance activities. As from 1 February 2020 the acquisition
contributed CHF 96 million of sales and a net profit of CHF 11 million to the Group’s consolidated results.
The identifiable assets and liabilities of Ungerer acquired are recorded at fair value at the date of acquisition and are as follows:in millions of Swiss francs

Fair value

Cash and Cash equivalents

94

Accounts receivable

36

Inventories

78

Other current assets

10

Property, plant and equipment

36- Client relationships

213- Process-oriented technology and other73- Name and product brands

10- Software / ERP system

1

Total identified intangible assets

297

Accounts payable(4)

Other payables(67)

Provisions

(7)

Debt

(7)

Deferred tax liabilities(63)

Net assets acquired403

Cash consideration

676

Goodwill

273

Givaudan – 2020 Half Year Report18 - Financial statements

The goodwill of CHF 273 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 goodwill is allocated partly to the flavour
division and partly to the fragrance division for the amounts of CHF 191 million and CHF 82 million respectively. The total amount of
goodwill that is expected to be deductible for tax purposes is nil.
The acquired receivables are fair valued at CHF 36 million. The gross contractual amounts of the receivables acquired are
CHF 37 million. The best estimation at the acquisition date of the contractual cash flows not to be collected amounts to CHF 1 million.
In compliance with IFRS 3, the fair values determined are provisional and the Group has twelve months from the date of acquisition
to finalise the allocation of the acquisition price.
IndenaOn 29 May 2020 Givaudan acquired the cosmetics business of Indena for a purchase price of CHF 32 million (EUR 30 million).
Headquartered in Milan, Italy, Indena is a world leading company dedicated to the identification, development and production ofhigh quality active ingredients derived from plants, for use in the pharmaceutical, health-food and personal care industries. With
almost a century of botanical experience, Indena has developed an extensive breadth of expertise in this field, while ensuring
bio-diversity and protecting the ecosystem from uncontrolled harvesting. From 29 May 2020, the acquisition has contributed CHF
0.3 million of sales to the Group’s consolidated results.
The identifiable assets and liabilities of the cosmetics business of Indena acquired are recorded at fair value at the date ofacquisition and CHF 21 million goodwill has been recognised. The goodwill arising on the acquisition relates mainly to the value ofthe qualified workforce and expected synergies that do not meet the criteria for recognition as separable intangible assets. 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

2020

2019

2020

2019

2020

2019

1,456

1,361

1,765

1,737

3,221

3,098

–

–

–

(4)

–

(4)

1,456

1,361

1,765

1,733

3,221

3,094

333

270

401

390

734

660

22.9%

19.8%

22.7%

22.5%

22.8%

21.3%

Depreciation

(39)

(34)

(61)

(54)

(100)

(88)

Amortisation

(30)

(23)

(61)

(57)

(91)

(80)

–

(11)

(1)

(11)

(1)

Additions to Property, plant and equipment

39

61

36

211

75

272

Acquisitions of Property, plant and equipment

11

6

25

36

6

Additions to Intangible assets

10

17

11

10

21

27

312

20

221

444

325

as % of sales

Impairment of long-lived assets

Acquisitions of Intangible assets (excluding goodwill)

39

20

273

Total gross investments

99

104

345

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

Givaudan – 2020 Half Year Report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

2020

2019

2020

2019

2020

2019

EBITDA

333

270

401

390

734

660

Depreciation

(39)

(34)

(61)

(54)

(100)

(88)

Amortisation

(30)

(23)

(61)

(57)

(91)

(80)

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

–

–

(11)

(1)

(11)

(1)

264

213

268

278

532

491

18.2%

15.7%

15.2%

16.0%

16.5%

15.9%

Financing costs

(39)

(36)

Other financial income (expense), net

(13)

(18)

Income before taxes

480

437

14.9%

14.1%

as % of sales

Classification of amortisation expenses is as follows:
Fragrances

Flavours

Group

2020

2019

2020

2019

2020

Cost of sales

5

3

7

5

12

8

Selling, marketing and distribution expenses

16

9

18

13

34

22

Research and product development expenses

5

6

26

29

31

35

Administration expenses

1

2

6

7

7

9

Other operating expenses

3

3

4

3

7

6

Total

30

23

61

57

91

80

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

2019

7. Other operating expense
2020

2019

Project related expenses

10

21

Amortisation of intangible assets

7

6

Impairment of long-lived assets

11

1

Loss on divestment

5

Losses on disposal of fixed assets

1

1

Environmental provisions

1–

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

Business taxes

10

10

Acquisition and integration related expenses

13

9

Other expenses

6

8

Total other operating expense64

56

During the first half of 2020 the Group continued to review its business portfolio and divested a small part of its business, which
resulted in a loss on divestment of CHF 5 million. Furthermore, as part of the manufacturing footprint optimisation program, theGroup restructured some of its operations and as a consequence recorded impairment charges of CHF 11 million.

Givaudan – 2020 Half Year Report20 - Financial statements

8. Financing costs
2020

2019

Interest expense38

31

Net interest related to defined benefit pension plans34

Derivative interest (gains) losses(3)–

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

Amortisation of debt discounts

1

1

Total financing costs

39

36

2020

2019

9. 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)

3

32

Exchange (gains) losses, net

(2)

(18)

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

3(5)Interest (income)

(2)

(2)

Capital taxes and other non-business taxes

44

Other (income) expense, net

7

7

Total other financial (income) expense, net

1318

10. 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:
2020

2019

413

380

Ordinary shares

9,233,586

9,233,586

Treasury shares(17,338)(19,197)

Income attributable to equity holder of the parent (in millions of Swiss francs)
Weighted average number of shares outstanding

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

9,216,248 9,214,389
44.81

41.24

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 (in millions of Swiss francs)
Weighted average number of shares outstanding for diluted earnings per share of 68,834 (2019: 67,443)
Diluted earnings per share (CHF)

Givaudan – 2020 Half Year Report

2020

2019

413

380

9,285,082 9,281,832
44.48

40.94

21 - Financial statements

11. Debt

2020
in millions of Swiss francs

Bank
overdrafts Public bonds

Privateplacements

Total
short-termandlong-term
debt

Total leaseliabilities

Total debt

Bankborrowings

Bank facility

Balance as at 1 January

68

600

2

2,453

567

3,690

441

4,131

Cash flows

736

(600)

1

907

(40)

1,004

(28)

976

1

4

5

1

4

2

6

(10)

(57)

(16)

(73)

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

1
3
(18)

(29)

- Lease liabilities
Balance as at 30 June

789

3

3,332

3

100

518

18

18

4,642

421

5,063

Within 1 year

703

806

40

846

Within 1 to 3 years

17

249

248

514

76

590

Within 3 to 5 years

38

350

270

658

55

713

Thereafter

31

2,633

2,664

250

2,914

Balance as at 30 June

789

518

4,642

421

5,063

Privateplacements

Total
short-termandlong-term
debt

Total leaseliabilities

Total debt

582

3,270

260

3,530

461

(52)

409

2019
in millions of Swiss francs

3

Bankborrowings

Bank facility

Balance as at 1 January

11

169

3

Cash flows

31

431

(1)

3,332

Bank
overdrafts Public bonds

2,505

Non-cash changes- Amortisation of debt discount1- Acquisition / Divestment31

1- Currency effects

(5)

(1)

(53)

(15)

1

9

10

32

20

52

(2)

(76)

(74)

- Lease liabilities
Balance as at 31 December

68

Within 1 year2

Within 1 to 3 years

18

Within 3 to 5 years

40

Thereafter

8

Balance as at 31 December

68

Givaudan – 2020 Half Year Report

600

600

206
4,131
335

2,453

2

250

39

293

42

249

108

375

49

424

150

362

1,152

35

1,187

2

3,690

441

2

600

567

206

1,804

58

1,870

315

2,185

2,453

567

3,690

441

4,131

22 - Financial statements

Details of the Group’s various debt transactions are as follows:

Issuer

Issue
date

Type
of debt

Givaudan SA

2011

Public bonds

Givaudan UnitedStates, Inc.

2012

Privateplacements a

2014
Public bonds
2016
2017
Givaudan SA

Givaudan FinanceEurope BV

Other entities

Privateplacements

Currencyofprincipal

Principal
amount in
millions

Redeemable

Interest
rate

150

07 Dec 2021

2.125%

149

40

06 Feb 2020

2.740%

reimbursed

39

USD

150

06 Feb 2023

3.300%

142

145

USD

60

06 Feb 2025

3.450%

CHF

100

18 Sep 2020

1.000%

57

58

100

100

CHF

150

19 Mar 2024

1.750%

150

150

100

07 Dec 2022

0.000%

100

100

0.625%CHF

200

05 Dec 2031

EUR

100

20 Dec 2022

EUR

200

20 Dec 2024

CHF

150

09 Apr 2020

1.331%

CHF

200

09 Apr 2025

0.375%

500

17 Sep 2025

1.125%

EUR

800

17 Sep 2030

2.000%

CHF

600

26 Jun 2023
Variousmaturities

Other local
borrowings

CHF

210

2020

EUR

150

USD

350

EUR

500

22 Apr 2027

500

22 Apr 2032

EUR

7

CNY

426 (2019)
609 (2020)

1.000%
1.625%
1.180%

Variousmaturities

otherTotal short-term and long-term debtb

200

200

Floating

106

108

Fixed

213

217

reimbursed

150

Floating

EUR

2019

2019

Fixed

149

CHF

Group bankcredit facility

Other local
borrowings

31 Dec 2019in millions of Swiss francs

CHF

Public bonds

Public bond

30 June 2020

USD

2018

2020

Type ofinterest

200

200

529

540

847

864

Floating

reimbursed

600

Floating

701

Fixed

Fixed
Fixed
Floating

528
529
6

8

82

59

3

3

4,642

3,690

a)	T here are various covenants contained in these transactions covering conditions on net worth, indebtedness and EBITDA ratio to net interest expense of Givaudan UnitedStates, Inc. The company is and has been in full compliance with the covenants set.
b) The fair value of the short-term and long-term debt exceeds its carrying value by approximately 5% as at 30 June 2020.

12. Equity

At the Annual General Meeting held on 25 March 2020 the distribution of an ordinary dividend of CHF 62.00 per share(2019: ordinary dividend of CHF 60.00 per share) was approved. The dividend payment has been paid out of available retained
earnings. At 30 June 2020, 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.

13. 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 2020 the Group held 4,594 own shares (2019: 15,541), as well as derivatives on own shares,
equating to a total long position of 54,000 (2019: 44,000).

Givaudan – 2020 Half Year Report23 - Financial statements

14. 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.

15. Other Information

As part of its long term strategy to expand its capabilities in bio-engineering technologies, Givaudan announced that it is toacquire Alderys. Founded in 2009, Alderys is an innovative French biotechnology company headquartered in Orsay, France,
employing 30 employees. Alderys develops innovative approaches to the biological engineering of valuable compounds fromrenewable feedstock. The projects developed by Alderys are aimed at the chemical and cosmetic industry sectors as well as
nutrition. They are recognised for offering innovative technological industrial solutions with high sustainability standards. The
closing of the acquisition is expected to take place in the second half of 2020.

Givaudan – 2020 Half Year Report

24 - Alternative Performance Measures

Alternative Performance Measures
Appendix to the 2020 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 2020 Half Year Results Media Release and on pages 5 - 8 of the 2020 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, (b) excluding sales of businesses acquired
from the acquisition date until the period end date, up to 12 months from the acquisition date, and (c) excluding sales of thebusinesses disposed of from the disposal date until the period end date of the comparable prior period.
Reconciliation tables of the LFL sales to the reported sales in accordance with IFRS have been included in the 2020 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

2020

2019

Income for the period

413

380

Interest and other financial (income) expense, net

52

54

Income taxes

67

57

Operating income

532

491

Depreciation

100

88

Amortisation

91

80

Impairment

11

1

EBITDA

734

660

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 2020 Half Year Results Media Release. In that reconciliation table, all significant one-off items have been
explained.

Givaudan – 2020 Half Year Report25 - 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

2020

2019

Cash flows from (for) operating activities

359

271

Acquisition of property, plant and equipment

(123)

(138)

Proceeds from the disposal of property, plant and equipment
Acquisition of intangible assets
Proceeds from the disposal of intangible assets

1

61

(19)

(17)

2

Interest paid

(14)

Lease payments

(28)

(10)
(19)

Free cash flow (FCF)

178

148

Sales

3,221

3,094

Free cash flow (FCF) as a % of sales

5.5%

4.8%

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 2020

31 December 2019

Short-term debt

846

335

Long-term debt

4,217

3,796

Less: cash and cash equivalents

(432)

(452)

Net debt

4,631

3,679

Total equity attributable to equity holders of the parent

3,145

3,640

Remeasurement of post-employment benefit obligations

488

525

Equity (as defined for leverage ratio)

3,633

4,165

Net debt and equity (as defined for leverage ratio)

8,264

7,844

Leverage ratio

56%

47%

Givaudan – 2020 Half Year Report26 - Financial statements

Givaudan – 2020 Half Year Report27 - 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, 2020

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