Novonesis (NSIS) CMD 2024 summary

Strategic vision and market positioning

• Positioned as a leading pure-play biosolutions company after merging two legacy firms, leveraging a broad toolbox and unmatched scale across the value chain.

• Focused on sustainable, biology-based solutions for human and planetary health, with over 80% of sales aligned to six UN Sustainable Development Goals.

• Integration of legacy businesses is progressing well, with a new organization focused on agility, customer-centricity, and innovation leadership.

• Addressable market for biosolutions is estimated at €20 billion, with potential to expand into the €1 trillion specialty chemicals and ingredients market.

• Strong advocacy and partnerships on the global stage support systemic change and faster adoption of biosolutions.

Growth drivers and business segments

• Organic sales growth CAGR of 6-8% is targeted through 2025, with ambitions to accelerate further beyond that period.

• Food & Health Biosolutions are expected to outpace Planetary Health Biosolutions in growth, driven by volume, price, and synergy effects.

• Key business areas include Food & Beverages (34% of sales), Human Health (12%), Household Care (18%), and Agriculture, Energy & Tech (36%).

• Revenue synergies of €200m are targeted by 2027, with 80-90m EUR in cost synergies on track, mainly from procurement and organizational efficiencies.

• Prioritization and selective investment in high-return areas are central to the growth strategy, with willingness to sunset non-core projects.

Financial guidance and operational performance

• 2024 guidance upgraded, with organic sales growth expected at the upper end of 5-7% and adjusted EBITDA margin of 35-36%.

• Margin expansion to ~37% adjusted EBITDA by 2025 is expected, driven by synergies, productivity, and value pricing.

• Achieved 80% of targeted cost synergies within five months of the merger, ahead of the original three-year plan.

• Free cash flow supported by operational efficiencies, improved payment terms, and disciplined capital allocation.

• Continued commitment to a stable dividend policy (40%-60% payout ratio) and selective bolt-on acquisitions.