Symrise has grown for the 17th year in a row, and the 2022 fiscal year was successful despite major challenges. One reason for this is the Group’s long-term strategy based on the pillars of growth, portfolio and efficiency, says Dr. Heinz-Jürgen Bertram (Chief Executive Officer 2019 to March 2024) in the interview. He explains that the company employs this strategy with many projects – for example, by skill­fully acquiring companies, identifying new business units to add to those areas already established and relying more and more on the sustainable and efficient circular economy with regard to raw materials and product developments.

GOOD CORPORATE GOVERNANCE

Dr. Bertram, 2022 was another year of crises – with the Russian war of aggression in Ukraine, ­rising inflation and energy prices, and the lingering consequences of the COVID-19 pandemic. How did Symrise overcome all of these challenges?

With sales of € 4,618 million, we achieved an EBITDA margin1 of 20 % in a difficult environment. And what’s equally important to us is the fact that we grew organically and at a faster pace than the com­petition, with a rate of 11.4 %. We’re therefore approaching our medium-term goals with confidence: By 2025, we plan to achieve annual growth of 5 % to 7 %, with profitability between 20 % and 23 %. By the end of the 2025 fiscal year, we plan to generate sales of € 5.5 billion to € 6.0 billion.

You talk about growth as one of the three pillars of your strategy, the other two being portfolio and efficiency. What conditions are necessary to ensure healthy growth in the Group?

Let’s take a look at the markets first. For example, we increased our sales in emerging markets by more than 40 % as planned – our goal there is 50 %. We’ve also expanded our customer base as a whole without losing sight of our long-term goal. We plan to maintain our balanced portfolio that equally consists of global, regional and local customers, whom we serve from our 100 sites worldwide. New sales channels such as online retail, which is increasingly important, are interesting options for our customers and for us.

Dr. Heinz-Jürgen Bertram

Dr. Heinz-Jürgen Bertram is committed to the circular economy across the entire raw material and product portfolio. The CEO of Symrise wants to use raw materials as fully as possible in order to use natural resources efficiently.

It will make us less dependent on individual business units as well as transform interdisciplinary collaboration in the Group into powerful synergies. Dr. Heinz-Jürgen Bertram, Chief Executive Officer (2019 to March 2024)

Numerous acquisitions in recent years have contributed to growth at Symrise. Did you also acquire new business units in 2022?

We’re always on the lookout for opportunities in fast-growing segments. While our growth last year was primarily organic, we invested in the right places, including fine fragrances, which is experiencing double-digit growth again after the COVID-19 pandemic. We purchased two companies – Groupe Néroli and SFA Romani – in southern France near Grasse, the world capital of perfume production (All for one, one for all). With a combined 200 employees, the two former competitors will operate under the shared name SFA Néroli in the future and will be able to leverage enormous synergies. They develop and produce fragrance compositions for customers around the world, from the finest perfumes to household products, and jointly achieved sales of around € 40 million in 2022. In addition, we will combine their extraordinary know-how with our revived Maison Lautier brand, for which we will be building a new factory just a few hundred meters away at the same site (Embracing traditions, shaping the future).

20 %

Symrise achieved a 20 % EBITDA margin1 in 2022.

4.618 

Symrise generated sales of € 4,618 million in 2022.

11,4 %

Symrise attained 11.4 % organic sales growth in 2022.

1 Excluding impairment of the associated company Swedencare 

Another pillar is the Symrise portfolio, which you have significantly expanded in recent years, particularly in terms of scope and beyond the traditional flavor and fragrance business units. Have you already achieved your goals in this area?

In 2008, we achieved 10 % of our sales in new divisions. Now it’s more than 30 %. We kicked off this transformation process, which the entire industry is now following, with the purchase of Diana in 2015 and will continue to pursue this strategy. We plan to do more than 40 % of our business outside of the traditional areas by 2025. This will better prepare us for the future, as it will make us less dependent on individual business units as well as transform interdisciplinary collaboration in the Group into powerful synergies.

What measures are you taking to expand the portfolio?

For example, we acquired Dutch company Schaffelaarbos, which processes by-products from egg production into products for the pet food industry. These complement the portfolio of Nuvin, the nutrition brand of Symrise Pet Food (Egg-Experts).This way, we’ve successfully expanded our areas of expertise and consolidated our leading position in the pet food industry, where we will continue to significantly expand our production and, over the medium-term, achieve sales of € 1.5 billion. For that reason, we also plan to grow in the field of animal health, where our interest in the Swedencare company will come in handy.

Based on our size and our responsibilities, it was time to expand our Executive Board.Dr. Heinz-Jürgen Bertram, Chief Executive Officer (2019 to March 2024)

Do you have such ambitious plans also in other areas of the portfolio?

We plan to further accelerate our sales growth in the Cosmetic Ingredients division, where we’ll primarily benefit from innovations and expand our business model to include decorative cosmetics. And in terms of Consumer Health, we’ll continue to research the microbiome – a collection of micro­organisms that are different in each part of the body – in order to develop suitable pre-, pro- and postbiotics.

The third pillar of your strategy is efficiency. How do you plan to improve Symrise in this area?

We purchase around 10,000 raw materials throughout all of the Group’s divisions. We can improve efficiency significantly by optimizing procurement with an increase in cross-divisional thinking. At the same time, we plan to acquire our raw materials in accordance with the highest sustainability standards. This is an issue that goes far beyond high levels of quality, as biodiversity plays a key role throughout the entire process. We continue to promote backward integration and are working closely with partners throughout the value chain.

Let’s stick with the topic of efficiency for just a moment. Why did you add two new members to the Executive Board at the end of January?

Based on our size and our responsibilities, it was time to expand our Executive Board. For example, in addition to my work as Chief Executive Officer, I was temporarily in charge of the Scent & Care segment, which was always supposed to be a short-term solution. As the new Executive Board, we’ve now found a wonderful internal solution for this area. Dr. Jörn Andreas, who has a doctorate in economics and until recently managed the Cosmetic Ingredients division at Symrise, will take over. Dr. Jörn Andreas has held a wide range of management positions at the company and overseen numerous mergers &  acquisitions as well as strategic initiatives. For the increasingly important, newly created Human Resources & Legal department, we’ve appointed experienced manager Stephanie Cossmann to the Executive Board. She has a doctorate in law and was most recently a member of the Board of Management and Head of HR at Lanxess AG.

We want to use 100 % of raw materials wherever possible and thus use our natural resources much more efficiently.Dr. Heinz-Jürgen Bertram, CEO

Just like time and staff, raw materials are in short supply, which is what makes the circular economy all the more important. In fact, the current Corporate Report is entitled “Creating resources with the circular economy.” Why is there such a focus on this approach?

We can follow the principles of the circular economy throughout our entire portfolio of raw materials and products. There are so many raw material processes in which valuable materials go unused. But we want to use 100 % of raw materials wherever possible and thus use our natural resources much more efficiently, which will also allow us to avoid traditional recycling in many areas. Incidentally, these innovative concepts have always been part of our DNA. When chemists Wilhelm Haarmann and Ferdinand Tiemann first produced synthetic vanillin from the sap of conifers in 1874, they used a raw material that no one else needed. Today, we’d describe that as value-adding upcycling. When Haarmann founded his company in 1875, he laid the foundation for the company now known as Symrise.

How do you implement the circular economy today?

We use the principles of the circular economy in many areas – for example, with the aforementioned purchase of Schaffelaarbos in the Taste, Nutrition & Health segment. We successfully implement similar business models there with by-products from meat production. Another example: Thanks to innovative methods, we can also use by-products from orange and sugar cane processing in the Scent & Care segment, resulting in many products that are renewable and biodegradable (One of a kind). But it doesn’t end there. As patented components, fragrance and ingredients offer the benefit of making fragrance compositions unmistakable, thus protecting them from imitators.

So, sustainable processes are still a key component of your strategy?

Absolutely. Our approaches are sustainable in many areas of the Group and help us to continuously reduce our CO2 emissions. That will allow us to be climate-positive in energy supply and consumption by 2030 and climate-neutral throughout the supply chain by 2045 (Positively into the Future). This way, we can continue our recipe for success, with sustainable business processes that benefit people and animals, the climate and the environment, while guaranteeing economic success.