“We are very proud of our European performance,” de Jong told us after the results were announced today showing the company’s EBITDA profits had climbed 5% on the previous year to €193m.
Although Europe, the Middle East and Africa (EMEA) was the slowest growing region for Chr Hansen at 5% (€364m) compared to the Americas (€276m, up 14%) and Asia Pacific (€98m, up 13%), de Jong said the growth was encouraging in a market hit by regulatory change and ongoing economic uncertainty.
“All our divisions and regions are in growth but EMEA does stand out as you have to remember remains in economic crisis and when you see that you have the ability for both cultures and enzymes and natural colours to deliver good growth in those markets, we are very proud of our European performance.”
Inside Europe
The health and nutrition division has struggled more in EMEA as probiotic health claims have been refused under the strict EU nutrition and health claims regulation (NHCR), provoking the company to write down €8m after two trials failed to deliver on gastrointestinal endpoints and switch its focus to emerging markets.
“But we haven’t given up on Europe, and smaller, more targeted trials are being commissioned in Europe,” de Jong said, noting advances in microbiome understanding may filter into claim-making, “in the next 5-7 years”.
Along with this activity are broader trials being commissioned among emerging market populations, “where we feel we have more to gain than say the EFSA (European Food Safety Authority)-regulated market.”
Across divisions on-the-ground sales forces were being beefed up in Asia and other emerging markets. “More and more we are dealing with customers directly rather than just dealing with distributors. Distributors will continue to play an important role but when it comes to owning the customer interface it is important that we are there.”
Going forward…
Despite preparing for a ‘soft Q1’ due to the loss of a major customer in its South American colours business (de Jong: “not carmine related”) that would suck 5% out of the value of its overall colours business, the company forecast 7-9% organic growth in 2013-2014.
It also said acquisitions were likely to feature in the coming financial period, especially smaller ‘bolt-on’ companies. "I would also expect us to form more partnerships and alliances - especially in the health and nutrition division," he reflected.
Colour supply issues around carmine and anthocyanin that affected the company in the early part of the year were close to be overcome, and likely to be fully resolved by the end of Q1, de Jong said.
Probiota 2014 will explore the prebiotic-probiotic scientific frontier, its evolution and commercial application in food, nutraceuticals, pharmaceuticals and cosmetics across the globe.
The global prebiotic and probiotic markets are changing rapidly and we are changing too - we even have a new name - Probiota - to reflect the meshing of Probiotech and Microbiota we began at the 2013 event. We´re also moving from Brussels to Amsterdam for the 2014 conference.