Flavor and fine ingredients specialists Frutarom has reported its full year financial results for 2016 with sales jumping 31.4% to a record US$1.14 million and gross profit for the company increase 31.4% to US$448 million. The company says this is another record year where it has successfully implemented its rapid growth and profitable strategy.
Sales from core business of special flavors and raw materials reached US$1.07 billion.
Flavors activity sales rose 39.3% to a record US$ 846.5 million, while specialty fine ingredient activity sales rose 23.2% to a record US$ 227.9 million.
Frutarom has been making a series of acquisitions which it contributes hugely to its success. Since the beginning of 2016, the company has completed nine strategic acquisitions for approximately US$255 million.
Ori Yehudai, president and CEO of Frutarom, explains how Frutarom is moving ahead with integrating the management, R&D, sales and marketing, operations, procurement and production platforms and fulfilling the plant amalgamation and resource optimization projects that are expected to bring operational savings at an annual rate of US$20-22 million, which will gradually be reflected over the course of 2017.
We are pleased with the additional leap forward we achieved in 2016 in which we again registered record results in sales, profits and cash flow. Over the past four years we have doubled Frutaroms revenues and profits, reflecting the successful implementation of our rapid and profitable growth strategy combining profitable internal growth, at growth rates higher than those of the markets in which we operate, together with strategic acquisitions that contribute to the continuing and consistent improvement in our results.
The 31.4% accelerated growth of our activity in 2016 stems from continued rapid internal growth of our profitable Flavors activity at the rate of 6.1% (on a constant currency and pro-forma basis) and from the contribution of the strategic acquisitions we made.
Further to the 11 acquisitions we made in 2015, since the beginning of 2016 we made another 9 strategic acquisitions and we progressed according to plan in fully merging and integrating them. We are continuing to create a strong quality pipeline of future acquisitions to support the fulfilling of our plan for accelerated growth in our core activities while expanding the share of the Flavors activity, including by gaining market leadership in the field of savory solutions and expanding the portfolio of natural solutions in the fields of flavors, health, colors and the natural antioxidants we offer our customers, and accelerating our growth and expanding our market share in North America and in emerging markets with high growth rates.
Their product range covers all the needs of modern flavor creators and includes: aroma chemicals, essential oils, natural botanical extracts, citrus specialties, distillates.
Their savory range covers: additives, emulsifiers, preservatives, butcher's aids, ripeners, marinades, anti-oxidants, as well as raw spices & mixtures for meat and fish and many other specialties. A key part of this range, now a thriving market, are Organic spices and mixtures.