第一季度报告的十大关键要点

Restricted - External European Specialty ChemicalsNEUTRALEuropean Consumer StaplesNEUTRALEuropean Specialty ChemicalsAlex Sloane+44 (0)20 3555 0645alexander.sloane@barclays.comBarclays, UKSetu Sharda+ 91 (0)22 6175 1934setu.sharda@barclays.comBarclays, UKKatie Richards+44 (0)20 3555 0315kathryn.richards@barclays.comBarclays, UKAnil Shenoy+91 (0)22 6175 2487anil.shenoy@barclays.comBarclays, UKAlex Stewart, CFA+44 (0)20 3555 4957alex.stewart@barclays.comBarclays, UKEuropean Consumer StaplesWarren Ackerman+44 (0)20 3134 1903warren.ackerman@barclays.comBarclays, UK disconnect. Givaudan indicated that it is currently growing 2x as fast with these customers vs.multinationals in Taste & Wellbeing and 3x as fast in Fragrance & Beauty, as a result of which theCEO cautioned against drawing a simple read-across to Givaudan's performance from listedmultinational customers. That said, North American OSG performance was notably weaker thangroup for Givaudan and Symrise, with the strongest growth in emerging markets and still robustperformance in Europe. Kerry, Ingredion and Symrise all attributed strong volume performancein food & beverage ingredient solutions to stepped up reformulation on health grounds,particularly in North America.Ingredients group valuation less demanding vs. Staples:Aftersharp relative de-rating of Q424 on growth slowdown fears, which continued into Q1 25, European Ingredients' PE premiumvs. MSCI EU Staples is back to 54%, below its five-year average of 60% and well below 2024'speak of 91%. As Ingredients stocks are deemed long-duration growth assets with a highpercentage of enterprise value in the terminal value, higher interest rates are relativelyunhelpful for valuation of the group due to higher discount rates on future growth. Given therelative valuation today, if Ingredients companies can prove that Q1 outperformance vs. Stapleswas driven more by structural tailwinds from innovation and customer mix, with continued top-line outperformance over the course of 2025, we see scope for relative valuation to rebuildsomewhat. Against other Speciality Chemicals groups, including the Industrial Gases group, theEU Ingredients group's valuation also looks relatively attractive in a historical context with PEparity vs. a 10-year average premium of 13% (see Figure 38).Conviction increased in Novonesis (OW), Tate (OW) and AAK (UW):Aftervery robust Q1results, Novonesis's unchanged FY25 guidance embeds some weaker end-market growthassumptions, which we think could prove conservative. In an uncertain macro environment,this is welcome and increases our confidence in Novonesis's relative ability to deliver. AAK'ssizeable volume miss in Q1 proved to be something of an outlier (particularly in its FoodIngredients segment), with the company prioritising its strong margin build over the past fewyears over top-line growth. This could prove moredifficultto sustain if competitors becomemore aggressive on price, in our view. Recent guidance from key peer Fuji Oil (NR) expecting itsVegetable Oil unit margin to decline from 12.6% in FY24 to 7.9% in FY25 (year to March2026) due to the “loss of temporary raw material gains” in fiscal 2024 increases our concern onthis front. Lauren Lieberman upgraded IFF to OW post Q1 results (see Upgrade to OW). Withmanagementre-affirmingits 2025 guidance, includingtariffsand encapsulating a significanteconomic slowdown at the low end of sales, we believe IFF has essentially de-risked numbers,such that YTD weakness in the stock could provide an attractive entry-point. We recentlyupgraded Tate & Lyle to OW on what we saw as a compelling risk/reward skew, given lowabsolute and relative valuations and early evidence that CP Kelco's performance has inflectedpositively. We think the company's CMD in July could be a positive catalyst. While there hasbeen no further news regarding the speculated (and unconfirmed) takeover interest in Tatefrom Advent in October 2024 (see FT reports Advent preparing a bid for Tate, 16 October), wethink the potential for renewed bid speculation likely provides at least a degree of downsideprotection to the share price and valuation.2 FIGURE 1. Q1 25 organic sales growth was driven by volume acrossFIGURE 2. Ingredient volume growth vs. major listed EU/US Food& HPC customer volume-2%-1%0%1%2%3%4%5%6%7%8%Source: Company data, Barclays ResearchFIGURE 3. Givaudan end-markets – share of largest multinationalcustomers is declining as local & regional customers take shareFIGURE 4. 52w dollar change in nutritional bars in the US –independents are driving >70% of growth-80-4004080120$mnSource: NielsenIQ, Barclays ResearchThe story in 6 charts...... FIGURE 5. EU Ingredients PE premium/discount vs. MSCI EU StaplesSource: BBG, Barclays Research20 May 2025 TariffguidanceGIVN sources c16kdifferentinputs, approximately 20% of which by value are from China. The company willpass through anytariff-associatedcost increases to customers with surcharge pricing, which will beimmediate