In 2009, Givaudan group sales totalled CHF 3,959 million, an increase of 1.4% in local currencies and a decrease of 3.1% in Swiss francs compared to the previous year. On a comparable basis (in local currencies and excluding the impact of divestments), sales increased by 1.6% versus 2008. Other important figures:

* Sustained EBITDA margin at 20.7%
* Net income up 79% to CHF 199 million
* Free cash flow tripled to CHF 459 million
* Strengthened balance sheet, net debt reduced by CHF 939 million
* Cash dividend of CHF 20.60 proposed

Givaudan's solid 2009 performance was driven by an acceleration of volume growth toward the end of the year, says Sal. Oppenheim. "Despite a slight gross margin decline due to high priced raw materials, the company showed a highly promising performance at the Ebitda line.". Expects a further continuation of the business recovery. Puts CHF780 fair value under review for an upgrade. Keeps neutral rating.

 

Vontobel downgrades Givaudan to hold from buy, as "substantial de-stocking" last year won't be repeated in 2010. "Besides that, market growth will normalize," says Vontobel. However, raises the price target to CHF940 from CHF890, saying Givaudan's sales growth and margin trend will outpace its peer group this year and will reflect the expected ongoing positive news flow. 

 

UBS raises Givaudan price target to CHF1,070 from CHF1,050 following the company's 2009 figures. Likes the company's cash generation. "We see an attractive and predictable 13% EPS compound annual growth rate through '14 complemented by strong deleveraging, share buybacks from '11 and a declining tax rate to 19% from the current 25% by '12," says UBS that has a buy rating.