UPDATE 1-Givaudan hikes dividend, confirms outlook after profit jump

Thu Jan 30, 2014 1:38am EST

* Full-year net profit 490 mln Sfr, beats poll

* Sales rise 5.5 pct to 4.4 bln Sfr, in line with poll

* Confirms midterm guidance

* Says to pay out dividend of 47 Sfr/share

ZURICH, Jan 30 (Reuters) - Fragrance and flavour maker Givaudan hiked its dividend by nearly a third and said it aims to continue to gain market share, after full-year net profit beat forecasts.

The world's No. 1 maker of flavours for beverages and snacks and fragrances for perfumes and washing powder said it would propose a dividend of 47 Swiss francs per share for 2013, a 30 percent increase over last year.

The company confirmed it intended to return above 60 percent of the company's free cash flow to shareholders while maintaining a medium-term leverage ratio target below 25 percent.

"Mid-term, the overall objective is to grow organically between 4.5 percent and 5.5 percent per annum, assuming a market growth of 2-3 percent and continue on the path of market share gains," Givaudan said in a statement on Thursday.

Net profit climbed 19.5 percent to 490 million Swiss francs ($547 million), beating a forecast of 470 million francs in a Reuters poll, helped by an improved operating performance, stable financial expenses and a lower income tax rate, Givaudan said.

Sales rose 5.5 percent on a like-for-like basis to 4.369 billion francs, in line with poll forecasts.

The group's EBITDA (earnings before interest, tax, depreciation and amortisation) margin rose to 22.2 percent from 20.9 percent a year ago, helped by an increase in profitability in its fragrances unit.

Givaudan shares rose over 32 percent last year, outperforming a 14 percent rise in the European chemicals sector . They trade at about 20.5 times forward earnings, at a premium to Symrise at 18.9 times and International Flavors & Fragrances at 17.7 times.

Symrise will publish full-year results on March 10 and IFF on February 13.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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