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A new era of conscious consumption is creating a shift toward more sustainable ingredients and eye-catching colour palettes influenced by the natural world, according to GNT.

GNT, which supplies plant-based EXBERRY® colours, has identified “Regeneration Rising” as a key trend in the food and drink sector. The company’s analysis explores the growing global appreciation for the natural world and desire to protect the planet. This mindset is now intensifying the focus on the origins of raw materials and sustainable production.

The Regeneration Rising trend is also inspiring new colour palettes as brands seek to convey instinctive messages about how their products are created. The use of visually impactful colours that can be found growing on land and in the sea helps manufacturers to showcase products’ eco-credentials and build emotional connections with consumers.

GNT has identified three new colour directions in line with the trend. “Elevated Earth” involves earthy shades from red-browns and warm oranges to textured purples and inky teals, elevating products with an organic but premium look and feel. “Nature Lab” is about pushing the boundaries of what is considered natural and features a kaleidoscopic spectrum of green, pink, red, yellow, orange, and blue. Finally, “Wholesome Nostalgia” features yellows, greens, blues, peaches, and pinks that range from velvet-like to milky, translucent, muted, and dreamlike.

Dieuwertje Raaijmakers, Marketing Communications Specialist at GNT Group, said: “Consumers of all ages are developing a much stronger interest in sustainability and rebuilding their relationships with the natural world. To appeal to these shoppers, food and beverage companies have to showcase their commitment to the planet. Colour can play an important role in telling that story, helping brands create appealing products that send out strong visual signals about how they’re produced.”

GNT has set out an ambition to lead the food colouring industry on sustainability. The company creates its EXBERRY® colours from fruits, vegetables, and plants and has set out a series of ambitious targets to optimise its environmental and social impacts at every stage of the value chain.

Oterra announced a new Chief Financial Officer, Hubert Windegger, who joined Oterra effective April 22nd, 2024.

Hubert Windegger joins the company with over 14 years of finance leadership experience, including roles at Private Equity-owned carve-outs and as CFO of ASK Chemicals. His strategic insights and proven track record in driving growth make him an invaluable addition to Oterra as they continue to innovate and expand their reach in the natural colour ingredients markets.

This change comes from Oterra’s current CFO, Mads Dehlsen Winther, who, after careful consideration, has decided to explore other career opportunities.

GNT has achieved a 22 % reduction in carbon intensity at its EXBERRY® factories since 2020, the company’s latest sustainability report shows.

GNT, which creates EXBERRY® colours from non-GMO fruit, vegetables, and plants, has set out 17 ambitious targets to optimise its environmental and social impacts over the course of the current decade.

In 2023, GNT’s total carbon footprint at its production sites in the Netherlands, Germany, and USA stood at nearly 13 thousand metric tons of CO2-equivalent emissions. This means 22 % less CO2 was emitted per ton of product sold compared to the base year of 2020, taking GNT almost halfway toward its ambition to achieve a 50 % reduction by 2030.

The new sustainability report reveals there was important progress in a number of other areas. GNT aims to enhance water efficiency at its factories by 20 % and has already delivered a 13 % improvement compared to 2020 levels. In addition, 74 % of the farmers in the company’s supply chain achieved a minimum of Farm Sustainability Assessment (FSA) Silver standard. The compliance rate for GNT’s Policy on Sustainable Sourcing, meanwhile, increased from 70 % to 90 %.

GNT also secured an EcoVadis silver medal last year and remains the only food colour supplier to have published a third-party Greenhouse Gas Verification Statement.

To read GNT’s ‘Sustainability report 2023,’ visit: https://exberry.com/en/sustainability-report-2023

GNT has achieved a 22 % reduction in carbon intensity at its EXBERRY® factories since 2020, the company’s latest sustainability report shows.

GNT, which creates EXBERRY® colours from non-GMO fruit, vegetables, and plants, has set out 17 ambitious targets to optimise its environmental and social impacts over the course of the current decade.

In 2023, GNT’s total carbon footprint at its production sites in the Netherlands, Germany, and USA stood at nearly 13 thousand metric tons of CO2-equivalent emissions. This means 22 % less CO2 was emitted per ton of product sold compared to the base year of 2020, taking GNT almost halfway toward its ambition to achieve a 50 % reduction by 2030.

The new sustainability report reveals there was important progress in a number of other areas. GNT aims to enhance water efficiency at its factories by 20 % and has already delivered a 13 % improvement compared to 2020 levels. In addition, 74 % of the farmers in the company’s supply chain achieved a minimum of Farm Sustainability Assessment (FSA) Silver standard. The compliance rate for GNT’s Policy on Sustainable Sourcing, meanwhile, increased from 70 % to 90 %.

GNT also secured an EcoVadis silver medal last year and remains the only food colour supplier to have published a third-party Greenhouse Gas Verification Statement.

To read GNT’s ‘Sustainability report 2023,’ visit: https://exberry.com/en/sustainability-report-2023

dsm-firmenich, a leading innovator in health, nutrition, and beauty, announces Peach+ as the 12th annual “Flavour of the Year” for 2024. Peach+ was inspired by PANTONE® 13-1023 Peach Fuzz, the 2024 Colour of the Year from PANTONE®, a global colour authority and provider of professional colour language standards and digital solutions for the design community. The selections were based on emerging signals in the cultural and consumer landscape where trends in kindness, community, goodness, and comfort have all been identified as having increasing relevancy. For more than 20 years, both companies have observed many of the same trend sources, drawing inspiration from a wide variety of influences, including culinary, fashion, hair and beauty, packaging and multimedia design, home decor and interior design, architecture, art, and the cultural zeitgeist.

Peach+ is an invitation to dsm-firmenich customers to innovate with this beloved flavour, to go beyond the traditional juicy sweet aspects to also consider softer, smoother, lighter, more refreshing, textural elements.

“Now in its 12th year, the announcement of the Flavour of the Year is an eagerly anticipated event,” said Maurizio Clementi, EVP Taste for Taste, Texture & Health at dsm-firmenich. “The delicate and natural qualities of Peach+ call for diverse applications across multiple food and beverage industries, and we are excited to see the innovations of our clients upon receiving this news.”

Empowering customers with insights into trends

The peach is one of the oldest cultivated fruits in the world, with a 4,000-year-old history that began in China and continues to this day. China is the world leader in peach production and exportation, with over 400 varietals under cultivation.

“Our research reveals that peach has many multifaceted meanings,” said Jeffrey Richard Schmoyer, VP of Human Insights for Taste, Texture & Health at dsm-firmenich. “And peach is incredibly emotional. While the peach has a long history, it also has an innovative future.”  According to Emotions 360, a proprietary dsm-firmenich consumer study that measures consumer emotions associated with ingredients, the peach is somewhat unique in that it has many innate qualities that contrast, such as being both indulgent and pampering, but also refreshing and revitalising, and youthful, but nostalgic.

Peach has been an evergreen fruit flavour in many categories for decades with a steady share of presence in innovations in most regions. Today, peach is growing in popularity in some regions and categories both as the primary tonality and in combination with others. The most prevalent areas of growth for peach new product development are carbonated soft drinks, nectars, candies, ready-to-drink teas, teas, flavoured alcoholic drinks, yogurt and fruit preparations, dairy drinks, juices containing peach, and fruit preserves. Other areas showing promise for growth are functional drinks and powdered soft drinks, as well as more savory opportunities for peach including side dishes, noodles, processed cheeses, and protein analogs. Peach in combination also spiked in favour of passion fruit plus peach, mango plus peach, peach plus tea, and apricot plus peach.

’’Flavour of the Year showcases emerging trends in flavour through proactive sensory experiences and creations, and completes its mission year after year, which is to empower our customers to be leaders in global trends,” says Mikel Cirkus, Global Creative Director for Taste, Texture & Health at dsm-firmenich. The company identifies countless possibilities to put the Plus in Peach for 2024, and confidently envisions how customers can lead with these emerging trends to ultimately create products with high impact and superior business relevancy.

Oterra, one of the the world’s leading suppliers of natural colours with one of the widest portfolios in the industry announced the addition of Vera Karmebäck to the team as its first Global Sustainability Lead.

Karmebäck enhances the international profile of the company, having been named a UN Global Compact SDG Pioneer in 2022. Vera, recognised for her strong work in having ‘demonstrated extraordinary progress and commitment towards achieving the Sustainable Development Goals’, comes from RA International – a remote site service provider.

Sustainability is a key focus area for Oterra in 2023, as the company looks to step out of the shadows of its previous parent company Chr. Hansen, and strongly solidify its own world contributions. For Oterra CEO, Odd Erik Hansen, the company’s mission of ‘making food and beverage easy for a healthy and sustainable world’ resonates with industry aspirations.

“Our employees and customers expect us to be the industry leader when it comes to sustainability – and as a natural colours company that believes nature got it right – it makes perfect sense that we lead the colour industry in finding the best ways to adopt sustainable practices for the future,” said Hansen.

Oterra is a key supplier of natural colours to most of the world’s largest food and beverage manufacturers.

A bold new era of “Healthy Hedonism” is inspiring a radical rethink of what is possible with natural colours, according to trend analysis by GNT.

GNT, the global supplier of plant-based EXBERRY® colours, explored how today’s consumers see colour in the world of food and drink and beyond. The research revealed a powerful new trend shaped by Generation Z’s desire to embrace joy and creativity while staying true to core values.

The new generation of consumers is radical, diverse, and digitally native – and it is rapidly changing global attitudes toward food and drink. Gen Z shoppers are committed to holistic wellness and are actively promoting environmental and social agendas through their purchases. At the same time, their devotion to social media means visual impact is more important than ever before.

This consumer behavior can be described as Healthy Hedonism. This ethos is now set to spark a global surge in demand for eye-catching products that are good for people and planet. From seductive healthy snacks to kaleidoscopic TikTok treats, the trend showcases a lifestyle that is playful, considered, and nourishing.

GNT’s analysis found that it is already generating new directions in natural colour. For example, cute soft-play pastel shades are being used to redefine what “healthy and sustainable” looks like. Psychedelic colour schemes now work in harmony with mind-boosting ingredients to tap into new-age wellbeing. Bright, clashing colour combinations can also enable brands to create virtuous products that satisfy the desire for creativity and self-expression.

Maartje Hendrickx, Market Development Manager at GNT Group, said: “Healthy Hedonism resonates with the new generation of conscious consumers who are determined to rewrite the rules. To tap into the trend, brands need to celebrate disruption and adopt a new visual language for products that are both healthy and environmentally sound. Earthy colours are no longer a necessity – it’s time to be bold, be creative, and make people smile.”

Available in shades spanning the full spectrum, EXBERRY® colours are plant-based concentrates created from non-GMO fruit, vegetables, and plants using traditional physical processing methods. GNT has also set out a commitment to become the leader in its field on sustainability by 2030.

To access GNT’s exclusive colour trend analysis on how Gen Z is changing perceptions of color, click here: https://exberry.com/en/discover-the-trend-that-is-redefining-natural-color/

Oterra, one of the world’s leading suppliers of natural colours, with one of the widest portfolios in the industry, announced the launch of the industry’s best natural alternative to Red40/Allura Red for beverage – Hansen Sweet Potato FruitMax® Red 116 WS.

In 2019, Oterra, at that time known as Chr. Hansen Natural Colors, launched its Hansen Sweet Potato range. The result of nearly a decade of ground-breaking research and development, the range quickly became an award-winning industry favourite, scooping up prizes in three continents: Europe, North America, and South America. The new vegetable variety was an instant hit for its stable, vibrant, and natural red alternative.

Driven by innovation and the desire to provide exceptional solutions for the industry, Oterra’s scientists went back to work after launching the original range to develop the next must-have solution for the beverage market. The result, FruitMax® Red 116 WS, is designed specifically for beverage manufacturers. It addresses the high complexity this industry faces when using anthocyanins, including fortification, high water-activity, carbonisation, off-flavour, and colour stability.

FruitMax® Red 116 WS provides manufacturers with a unique clean label, minimally processed, and GMO-free fire-engine red shade for beverage, making it the industry’s best natural alternative to RED40 or Allura Red.

FruitMax® Red 116 WS is recommended for alcoholic beverages, carbonated soft drinks, cordials, energy drinks, juice-based drinks and near waters.

Moving beyond the traditional annual colour forecast, GNT has launched groundbreaking research that empowers food and beverage brands to devise tailormade solutions for the modern market.

The growth of the personalization and customization trends is fueling demand for products that appeal to shoppers on a deeper level. Building on more than 40 years’ experience, GNT has developed ‘The Power of Colour’ to help brands create colouring solutions that will connect with their target consumers.

The research combines consumer psychology and semiotics to deliver unique insights into how color generates meaning across products, brands, and categories, enabling manufacturers to create powerful stories and stand out in their category.

Maartje Hendrickx, Market Development Manager at GNT, said: “It’s clear that a one-size-fits-all approach to colour is rapidly becoming outdated. As a service provider, innovation has always been in our DNA and this trailblazing project enables us to help customers find the cutting-edge colouring solutions they need to strengthen their market position and reach new audiences.”

Created alongside professional semioticians, The Power of Colour explores the many ways in which colour sends out messages on a conscious and subconscious level.

For an inside-out perspective, it uses psychology to explore consumer motivations. It examines the tensions that drive product and brand choices, such as the desire for pleasurable yet permissible food and drink.

The second phase uses semiotics to provide an outside-in perspective, showing how colour can help to deliver on these motivations and needs.

Colour codes and cues create a variety of meanings across different cultures, categories, and situations. For example, colour can indicate how to navigate situations and guide decision-making, as in the case of food nutrition labels. It can also signal personal identity, whether through fashion, cosmetics, or even food and drink. Colours evoke moods and emotions, too – red is seen as an energizing shade, for instance, while yellow is associated with joy.

Together, these two perspectives allow brands to build a comprehensive understanding of how colour can be used to cater to different consumer needs and create a compelling narrative.

Jill Janssen, GNT’s Power of Colour lead, said: “Colour can send out any number of messages about brands and products. It might signal a moment of blissful escapism, tell stories about origins and process, showcase powerful ingredients, or help to highlight healthy formulations. The Power of Colour helps brands think about colour in a new way, delving deeper than ever before into its cultural power while also exploring the psychology behind colour trends.”

Establishing global leadership position in natural colours

As part of its 2025 strategy to expand the portfolio of its global Taste & Wellbeing business, Givaudan announced that it has reached an agreement to acquire DDW, The Color House, a US based natural colour company. The acquisition will enable Givaudan to become a global leader in natural colours, enhancing its ability to create “Feel Good” Food Experiences through its extensive portfolio of taste and sense solutions.

Headquartered in Louisville, Kentucky, USA, DDW is a leading privately-held company in the natural colour industry, with 12 manufacturing facilities around the world and 315 associates. Founded in 1865, the company has developed a strong market position from its origins in the brewing industry through its market leading capabilities in caramel colours and for the last 20 years having a strong focus on natural colours for the food and beverage industry.

The terms of the deal have not been disclosed and Givaudan plans to debt fund the transaction. DDW’s business would have represented approximately USD 140 million of incremental sales to Givaudan’s results in 2020 on a proforma basis. The transaction is expected to close in Q4 2021.

Oterra is pleased to announce that it has closed its acquisition of SECNA Natural Ingredients Group S.L.

This is the first acquisition for Oterra, which itself was purchased by private investment firm EQT in March 2021 when Chr. Hansen divested their natural colours business. Oterra, recently announced its intention to pursue a second acquisition, namely Diana Food’s colours business. 

Odd Erik Hansen, CEO of Oterra, stated, “This is an exciting time for the industry as demand for natural colors continues to increase. We expect the addition of SECNA to be a meaningful contributor to Oterra’s growth in 2021 and beyond, as we solidify our position as one of the world’s leading suppliers of natural colours. We look forward to offering both our, and SECNA’s, customers a fully integrated go-to-market service soon.”

With this acquisition, Oterra, will further enhance its value offerings to customers worldwide. Notable portfolio additions include SECNA’S anthocyanins from black carrots and grape, as well as caramel, and an organic range. After a period, the SECNA group will be fully incorporated into Oterra.

Approximately 80 SECNA employees, based in Spain and Italy, will join Oterra. This is an exciting time for Oterra, who look forward to having them on the team. “SECNA’s skilled and competent workforce stood out from the start, and I am happy to welcome them to the Oterra family,” said Odd Erik Hansen.

Chr. Hansen Natural Colors, an EQT portfolio company, announces its first major transaction, after becoming a standalone company, further bolstering the company’s position as the world leader in natural colours.

Chr. Hansen Natural Colors, a world leading provider of natural colors with the widest portfolio in the industry, has announced plans to continue its strong growth acceleration with the integration of SECNA Natural Ingredients Group S.L into its portfolio.

This is the first add-on investment since being acquired by private equity firm EQT, and it significantly strengthens Chr. Hansen Natural Colors position by giving it access to SECNA Groups’ strong pigment portfolio, which notably includes anthocyanins from black carrots and grape, and caramel.

“We’re committed to continuing to find new ways to harness and share the power of nature’s true colours. This is the first of many exciting milestones for us as a standalone company. We look to enhance our value proposition and strengthen our operational platform together with the team at SECNA at a time when demand for naturally sourced colours is increasing” said Odd Erik Hansen, CEO, Chr. Hansen Natural Colors.

For SECNA Group CEO, Gabriel Muñoz, this partnership is the ideal opportunity to join forces with a like-minded established industry leader. “It’s a win–win situation as Chr. Hansen Natural Colors will add our strong pigment offerings in anthocyanins and caramel to their collection, while providing our valued customers and suppliers with access to their portfolio, technologies and market reach, which is the most extensive in the industry”.

“The combination of our colour platforms puts us in a prime position to better serve the market and our customers, and we’re looking forward to welcoming SECNA Groups’ 100 employees to the Chr. Hansen Natural Colors team” said Klaus Bjerrum, COO, Chr. Hansen Natural Colors.

The SECNA group is a holding of several companies, with a presence in Spain, Italy and Turkey.

Chr. Hansen Holding A/S entered into an agreement to divest its Natural Colors business to the EQT IX Fund for a cash consideration of 800 EUR million on cash and debt free basis. The transaction is expected to close during the spring of 2021, subject to regulatory approvals.

This agreement concludes the strategic review of the Company’s portfolio announced in July 2020, where Chr. Hansen’s Board of Directors and the Executive Board decided to explore strategic options for the Natural Colors business as it does not share the microbial and fermentation technology platforms.

Mauricio Graber, CEO of Chr. Hansen, said: “The divestment of Natural Colors completes the Review part of our recently launched 2025 Strategy. Chr. Hansen can now focus on fulfilling the ambition of becoming a pure-play, microbial and fermentation company with industry leading, profitable growth. I am convinced EQT will be a great owner of the Natural Colors business which has a leading global position in the industry. During the process it has become clear that EQT showed the strongest conviction in the potential of the business, and the highest dedication to the future development of it. I want to thank all the employees of the Natural Colors business for their contribution to Chr. Hansen over many years, and wish them all the best in the future journey as an independent company.”

Mads Ditlevsen, Partner at EQT Partners, and Investment Advisor to EQT IX, commented: “We are immensely proud and humble of having been chosen as the future owner of Natural Colors. It is a high- quality and truly global business with a proud legacy of servicing customers all over the world for more than 100 years. We are highly impressed by the strong ESG profile, the high-quality organization and talented people we have met during this process, as well as the dedicated focus on food safety. Natural Colors fits very well with EQT’s thematic investment criteria and is operating in two of EQT IX’s five prioritized sub- sectors within Industrial Technology. EQT’s ambition is to help the business achieve further growth both organically and through acquisitions.”

Klaus Bjerrum, Executive Vice President of Natural Colors, said: “I am very pleased to announce EQT as the new owner of Chr. Hansen’s Natural Colors business. EQT has acquired our great business (pending closing) to grow it organically and inorganically based on our capabilities and organization, and not least our leading market position. It is my conviction that this marks a new and exciting chapter for us, and I am
excited to embark on this journey with EQT and all our talented employees around the world.”

Financial implications and outlook
Chr. Hansen’s long-term financial ambition is unaffected by the divestment. The proceeds from the divestment will reduce the leverage of Chr. Hansen, and will otherwise be utilized according to the capital allocation principles.
In the Chr. Hansen Annual Report, which will be released on October 8, the divested business will be presented as discontinued operations. The outlook for organic growth, EBIT before special items and free cash flow before acquisitions and special items for 2020/21, that will also be presented in the annual report, will not include the discontinued operations. Furthermore, the preliminary estimates of impacts of the transaction in 2020/21 will be part of the outlook.

Chr. Hansen Holding A/S today released its 2025 Strategy with the ambition to create a differentiated bioscience company with focus on its microbial and fermentation technology platforms putting Food Cultures & Enzymes and Health & Nutrition at the center of its new strategy. During the strategy period which runs until the end of the financial year 2024/25, Chr. Hansen’s long-term financial ambition is to deliver mid- to high single-digit organic growth, averaged over the period. Furthermore, the Company plans to increase its underlying EBIT margin before special items, before portfolio changes and currency impacts, with efficiency gains and scalability benefits from operations, as well as synergies from recent acquisitions, to be partly reinvested into the business during the strategy period. Average growth in free cash flow before acquisitions and special items is expected to exceed the average absolute EBIT growth.

CEO Mauricio Graber says: “Chr. Hansen has undertaken a tremendous journey since its start as an ingredient supplier to the dairy industry, and I feel very proud to lead a company with such a strong purpose and so many exciting growth prospects. With the launch of our 2025 Strategy we are stepping up our game to unlock the next wave of value creation by advancing Chr. Hansen into a focused global bioscience player that specializes in fermentation technology and microbial solutions. With this focus we will be uniquely positioned and clearly stand out in our industry.”

“At Chr. Hansen, we will continue to pioneer microbial science to improve food and health, for a more sustainable future. Already today, more than 80 % of our revenue contribute to the United Nation’s Sustainable Development Goals, and we are committed to continuing to leverage the Power of Good Bacteria™ which is also reflected in our newly defined purpose: ‘Grow a better world. Naturally.’”

Underlying markets remain attractive

During its strategy process, Chr. Hansen has conducted a thorough review of industry dynamics, consumer trends and growth opportunities in its existing segments. Megatrends such as a growing world population, demographic shifts, increasing health awareness and a strong climate change agenda continue to support Chr. Hansen’s business model. Growth prospects in the Company’s underlying markets remain attractive.

2025 Strategy (‘where to play’)

Under its 2025 Strategy, Chr. Hansen has defined four strategic focus areas that set the framework for its future growth trajectory: REINVEST, LEVERAGE, EXTEND and REVIEW.

REINVEST in core platforms

Chr. Hansen has been the ingredient supplier of choice for the dairy industry for many decades and has also built a strong microbial business for animal feed, dietary supplements and infant formula over the last thirty years. During the strategy period the majority of the absolute growth will come from the core platforms. As such Chr. Hansen will continue to prioritize and invest in Food Cultures & Enzymes, Animal and Human Health. Innovative products, launched across all business areas, are expected in the strategy period, both in existing and new product categories, for example probiotic solutions for foods and pet food.

LEVERAGE the Microbial Platform to grow lighthouses and new areas

Chr. Hansen continues to see many attractive growth opportunities to leverage its technology platform to develop solutions for new applications and end markets. The Company remains committed to further develop its existing lighthouses Bioprotection, Plant Health and Bacthera, and is today launching a new lighthouse in Fermented Plant Bases, where Chr. Hansen sees itself uniquely positioned to gain a meaningful share in this fast-growing market.

“Each of the four lighthouses holds tremendous potential. We are breaking new ground, and I am truly excited about the journey that lies ahead of us when it comes to fighting food waste, shaping the future of food and contributing to sustainable farming and the development of pharmaceuticals based on bacteria,” says CEO Mauricio Graber.

Lighthouses at a glance:

  • Bioprotection: Special culture range that prevents spoilage, reduces food waste and increases safety of dairy and other foods. The long-term market opportunity is estimated to be around EUR 1 billion with an addressable market of around EUR 200 million in 2025
  • Fermented plant bases: Fermentation solutions for spoonable and drinkable fermented milk alternatives and fermented beverages. The long-term market opportunity is estimated to be more than EUR 100 million with an addressable market of less than EUR 100 million in 2025
  • Plant health: Crop protection solutions with a focus on bionematicides, biostimulants and biofungicides. The long-term market opportunity is estimated to be more than EUR 1 billion with an addressable market of around EUR 400 million in 2025
  • Bacthera: Joint venture with Lonza AG in contract manufacturing for live biotherapeutics. The long-term market opportunity is estimated to be more than EUR 1 billion with an addressable market of EUR 150-200 million in 2025 (only clinical trial market)

EXTEND Microbial Platform through M&A and R&D partnerships

During the strategy period Chr. Hansen intends to further strengthen its technology platform across its competencies, such as cultures and probiotics, dairy enzymes and value-added fermentation through acquisitions and the expansion of the R&D partner network. The recent acquisitions of HSO Health Care and UAS Laboratories are examples of this, and both offer attractive commercial, operational and R&D synergy opportunities.

REVIEW strategic options for non-microbial assets

Chr. Hansen’s Natural Colors division is the global market leader for natural colors. Whilst the division shares the Company’s overall purpose and stand-alone offers an attractive return profile, synergies with the Microbial Platform are limited. As already communicated on July 2, Chr. Hansen has therefore decided to initiate a strategic review of its Natural Colors division. The process is progressing well.

Implementation of 2025 Strategy (‘how to win’)

Chr. Hansen has defined five dimensions along which the Company is going to implement the strategy:

  1. CUSTOMERS: Chr. Hansen will further broaden its customer base and expand its global reach to become a truly global bioscience company. The Company aims to increase its presence in emerging markets. Secondly, Chr. Hansen will continue to invest in application development, sales and marketing resources to positively influence end-market demand and advance its digital agenda to deliver best-in-class service to its customers
  2. INNOVATION: Bringing new innovations with a sustainable impact to market remains a top strategic priority. As such Chr. Hansen will allocate around 75 % of the R&D spending during the strategy period towards new product development. Furthermore, the Company will intensify its efforts to bring products to market faster
  3. OPERATIONS: Chr. Hansen continues to see ample room to realize further operational efficiencies in its production through process innovations and automation/digitization whilst driving scalability benefits through future capacity expansions. Capex spending as a percentage of sales is expected to decline over the period compared to 2018/19
  4. PEOPLE: As Chr. Hansen grows as an organization it is important to safeguard the Company’s unique purpose and performance culture. Furthermore, the Company will continue to invest in talent management and is committed to driving diversity
  5. PURPOSE: As part of its new strategy, Chr. Hansen will accelerate its sustainability ambition and commits to the Science Based Targets initiative to limit global temperature rise to 1.5 degrees by reducing its environmental footprint with investments into renewable energy, recyclable packaging and circular biowaste management.

New financial and non-financial ambitions until 2024/25

Chr. Hansen has an ambitious financial agenda and remains committed to delivering industry-leading profitable growth and a strong cash flow generation. From the base year of 2018/19, Chr. Hansen aims to deliver:

  • Mid- to high single-digit organic growth, averaged over the period
  • An increase in EBIT margin before special items, before portfolio changes and currency impacts. The margin improvement is expected to be based on efficiency gains and scalability benefits from operations as well as synergies from recent acquisitions, which will be partly reinvested into the business during the strategy period
  • An average growth in free cash flow before acquisitions and special items exceeding the average growth in absolute EBIT before acquisitions and special items
  • The financial ambition is based on constant currencies and does not take future acquisitions or divestments into account, even if future activities are likely. The financial ambition is also based on the current political and economic environment and projections, and any deterioration may impact the ambition negatively (please see next page for details on COVID-19).

Chr. Hansen has set the following sustainability and non-financial ambitions:

Products: More than 80 % of revenue from sustainable products that contribute to the United Nation’s Sustainable Development Goals 2, 3 and 12; 25 million hectares covered with natural solutions (Plant Health and silage inoculants); 200m people consuming Chr. Hansen’s probiotic strains; 2 million tons of yogurt waste reduced

Planet: As part of its commitment to limit global temperature rise to 1.5 degrees, Chr. Hansen aims for 100 % renewable energy, circular management of biowaste and recyclable key packaging materials

People: The Company aims to have introduced 100 % of its new employees to its culture model, have a 1:1 equal ratio between female employees and women in management, have a top 25 % score in its employee engagement survey and reach a lost-time incident frequency of below 1.5

Capital allocation priorities

Chr. Hansen’s capital allocation framework remains unchanged. Organic growth remains the number one priority followed by bolt-on acquisitions which the Company seeks proactively to strengthen its Microbial Platform, particularly in the dynamic and evolving Health & Nutrition markets. Thirdly, Chr. Hansen will maintain the policy of issuing an ordinary dividend of 40-60 % of net income . Finally any excess cash will be distributed as extraordinary dividends or share buy-backs.

Impact of COVID-19 on market outlooks

The global COVID-19 pandemic has changed consumption patterns and consumer choices and has put supply chains globally under pressure. As an essential part of the food supply chain and supplier to the health industry, Chr. Hansen did not see material impacts to its operations or business model from the pandemic. However, during a global recession, potentially lower protein consumption (especially in emerging markets) and delayed or reduced demand from customers may impact Chr. Hansen’s ability to drive sales. That said, the pandemic crisis also provides new opportunities, for example through increasing health awareness and interest in probiotics with immunity concepts.

DDW, The Color House, is pleased to announce that on June 28, 2019 it completed a transaction to acquire the DuPont Natural Colors business which was part of DuPont’s Nutrition & Biosciences division.  The acquisition expands DDW’s global reach and adds technical and manufacturing capabilities in several core natural colors.

DDW adds two DuPont manufacturing facilities (Burton-on-Trent, UK and Santiago, Chile) and all related customer contracts. The expanded business will operate under the “DDW, The Color House” brand. DuPont originally acquired the business in 2017 as part of their acquisition of FMC’s Health & Nutrition business.

“This is the perfect opportunity to expand our portfolio with unique new products and  deepen our position in blending and emulsions. The associates at both sites are very experienced and will ensure that we can continue to provide outstanding products and services during the transition,” explains Ted Nixon, CEO of DDW.