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UPDATE 1-Givaudan confirms targets as Q1 growth beats poll
April 11, 2017 / 5:40 AM / 8 months ago

UPDATE 1-Givaudan confirms targets as Q1 growth beats poll

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ZURICH, April 11 (Reuters) - Flavour and fragrance maker Givaudan confirmed its mid-term targets and said it wanted to keep growing its dividend after growth slowed less than expected in the first quarter, helped by a strong performance in North America.

Givaudan and its peers are grappling with slowing growth at consumer goods groups such as Nestle and Unilever , to whom they supply flavours for foods and drinks and fragrances for toothpaste and soap, and a rise in raw material prices.

“Givaudan started the year with good business momentum,” the Geneva-based company said in a statement on Tuesday, adding it was implementing price increases in collaboration with its customers to compensate for increases in input costs.

It confirmed its goal of like-for-like annual sales growth of 4-5 percent on average until 2020 and said it wanted to maintain its dividend practice. It has increased the dividend for 16 years in a row.

Sales of 1.24 billion Swiss francs ($1.23 billion) in the first quarter of 2017 were up 3.5 percent like-for-like, slower than 5.8 percent in the year-ago period but above the average estimate of 1.5 percent growth in a Reuters poll.

Sales at its fragrance unit that created perfumes such as Tom Ford Noir Pour Femme and Bottega Veneta Pour Homme Extreme rose 2.1 percent despite a high comparison base, helped by strong gains in fine fragrances in western Europe, Africa and the Middle East and a double-digit increase in the home care segment.

Sales in the flavours business were up 4.8 percent, above the 3.5 percent progression in the first quarter of 2016. Including recently acquired Spictec and Activ International, growth stood at 14.1 percent in local currency.

Among regions North America stood out with 9.2 percent like-for-like overall growth, thanks to a weaker comparison and new wins in dairy and beverages, Givaudan said.

$1 = 1.0087 Swiss francs Reporting by Silke Koltrowitz; Editing by Michael Shields

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