Corbion's Q3 Success: Sales Growth, Profit Improvement, and Positive Free Cash Flow

Corbion, the Amsterdam-listed sustainable ingredients company, has reported a strong performance in the third quarter, driven by sales growth, profit improvement, and positive free cash flow. The company's restructuring program, divestment of the Emulsifier business, and positive momentum in key segments have all contributed to these positive results.

Corbion's restructuring program has played a significant role in increasing margins and improving profitability. The program, which focuses on operational excellence and cost reduction, has led to increased efficiency and improved financial performance. The company's adjusted EBITDA margin increased to 15.3% in the first half of 2024, up from 10.8% in the same period last year.

The divestment of the non-core US Emulsifier business has also contributed to Corbion's Q3 performance and future outlook. The divestment, completed on April 2nd, has allowed the company to focus on its core businesses and improve its financial position. The divestment has also led to an improvement in the company's net debt/covenant EBITDA ratio, which stood at 2.2x at the half-year end.

The positive momentum in the Functional Ingredients & Solutions and Health & Nutrition segments has driven Corbion's sales growth. The Food segment within Functional Ingredients & Solutions has seen strong volume/mix growth, while the Biochemicals segment has experienced temporary softness in some markets. In the Health & Nutrition segment, Corbion has seen strong double-digit growth in both sales and adjusted EBITDA, driven mainly by the Nutrition segment, particularly Omega-3 DHA within aquaculture and pet nutrition.

The start-up phase of the new circular lactic acid plant in Thailand has also impacted Corbion's Q3 results and future prospects. The plant's completion has allowed the company to gradually ramp up production and produce the first volumes of lactic acid. This new plant is expected to contribute to the company's growth and sustainability efforts.

Corbion's positive free cash flow in Q3 is a testament to the company's strong financial performance. The company's free cash flow was €336.5 million, excluding divestment proceeds. This positive cash flow is driven by the company's strong sales growth, improved profitability, and effective working capital management.

In conclusion, Corbion's Q3 performance, driven by sales growth, profit improvement, and positive free cash flow, is a reflection of the company's strategic initiatives and strong execution. The company's restructuring program, divestment of the Emulsifier business, and positive momentum in key segments have all contributed to these positive results. With a strong outlook for the full year, Corbion is well-positioned to continue its growth trajectory and deliver value to shareholders.