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Outlook & long-term ambitions

Read about our long-term financial and non-financial ambitions until 2024/25 and our outlook for 2020/21

Financial ambition until 2024/25

Chr. Hansen has an ambitious financial agenda and remains committed to delivering industry-leading profitable growth and a strong cash flow generation. Under its 2025 Strategy and from the base year of 2018/19, Chr. Hansen aims to deliver:    

  • Mid- to high single-digit organic growth, averaged over the period.

  • An increase in EBIT margin before special items, before portfolio changes and currency impacts. The margin improvement is expected to be based on efficiency gains and scalability benefits from operations as well as synergies from recent acquisitions, which will be partly reinvested into the business during the strategy period.

  • An average growth in free cash flow before acquisitions and special items exceeding the average growth in absolute EBIT before acquisitions and special items.

The financial ambition is based on constant currencies and does not take future acquisitions or divestments into account, even if future activities are likely. The financial ambition is also based on the current political and economic environment and projections, and any deterioration may impact the ambition negatively.


Non-financial ambition until 2024/25

As part of its 2025 Strategy, Chr. Hansen has set the following sustainability and non-financial ambitions:

  • PRODUCTS: More than 80% of revenue from sustainable products that contribute to the United Nation’s Sustainable Development Goals 2, 3 and 12; 25 million hectares covered with natural solutions (Plant Health and silage inoculants); 200m people consuming Chr. Hansen’s probiotic strains; 2 million tons of yogurt waste reduced.

  • PLANET: As part of its commitment to limit global temperature rise to 1.5 degrees, Chr. Hansen aims for 100% renewable energy, circular management of biowaste and recyclable key packaging materials.

  • PEOPLE: the Company aims to have introduced 100% of its new employees to its culture model, have a 1:1 equal ratio between female employees and women in management, have a top 25% score in its employee engagement survey and reach a lost-time incident frequency of below 1.5.


Outlook for 2020/21

This information has been updated with our annual report 2019/20 that was published on October 8, 2020.

Organic revenue growth

For 2020/21, organic revenue growth is expected to be 5-8%, with the highest contribution from  Health & Nutrition. Food Cultures & Enzymes is expected to grow significantly above the relatively low end market growth, and with a positive impact from EUR pricing similar to the reported effect in 2019/20. Growth will be driven by continued momentum in bioprotection and dairy enzymes, as well as fermented plant bases, albeit from a relatively low base. Health & Nutrition is expected to grow faster than the respective underlying markets of probiotics for humans, animals and plants, and will generally be driven by increased demand and increased market penetration of new and recently launched products.

EBIT margin before special items (b.s.i.)

EBIT margin b.s.i. is expected to be 27-28%. Relative to the EBIT margin of 29.9% delivered in  2019/20, the margin is expected to be impacted negatively by currencies, primarily the USD and CNY, while the  portfolio changes – acquisitions of HSO Health Care, UAS Laboratories, and Jennewein, and the divestment of Natural Colors – combined are expected to have a small net negative impact (but accretive to EBITDA margin). Additionally, the Company expects to return to a more normalized travel activity and cost level during 2021, and to continue investments in growth and innovation opportunities.

Free cash flow

Free cash flow before acquisitions & divestments and special items is expected to be EUR 120-160 million. Cash flow from operations is expected to be similar to 2019/20 despite a normalization of certain working capital items and higher interest costs. Cash flow used for investing activities is expected to be around EUR 200 million driven by investments into the new HMO business incl. the new factory in Kalundborg (which is expected to be less than EUR 100 million), whereas as the capex-to-sales ratio excluding the HMO investments is expected to be lower than 2019/20.

Financial implications of portfolio changes

In addition to the guidance parameters outlined above, the acquired businesses (that will have no material impact on organic growth), are estimated to contribute around EUR 130-140 million in revenues, with the highest uncertainty around the timing of ramp-up of the HMO business, and with an estimated EBITDA contribution of around EUR 30 million. In addition, the divestment of Natural Colors is expected to contribute a gain from divested businesses on profit from discontinued operations for the period of around EUR 650-700 million.


Chr. Hansen is a global company serving more than 140 countries through subsidiaries in more than 30 countries. The most significant currency exposure relates to USD, which accounts for 30-35% of revenue, while exposure to other currencies is more modest. A 5% decrease in the EUR/USD exchange rate would impact revenue measured in EUR negatively by EUR 15-20 million.
Organic revenue growth is sensitive to exchange rate fluctuations in currencies for which Chr. Hansen applies a EUR-based pricing model. 

The EBIT margin is also sensitive to exchange rate fluctuations. Production in the US only partly offsets the impact on revenue from changes in the EUR/USD exchange rate. Therefore, the relative EBIT exposure is higher than the revenue exposure. A 5% decrease in the EUR/USD exchange rate would impact EBIT negatively by roughly two thirds of the revenue impact. The sensitivity to currency developments also applies to the free cash flow. The use of currency hedging of balance sheet exposures and future cash flows is described in note 4.3 to the Consolidated Financial Statements 2019/20.


The outlook is based on constant currencies and assumes no further acquisitions. The outlook is also based on the current political and economic environment. The depth and duration of a global recession, or other negative macroeconomic events, triggered by COVID-19 may affect demand negatively in the medium term, especially in emerging markets, and a combination of quarantine measures and recession may change consumption patterns between eating out, on-the-go and in-home. The various quarantine measures and travel restrictions already imposed around the world make it more difficult to visit customers to advance projects with new innovative solutions, a very important growth driver for Chr. Hansen, and this will slow the progress of the commercial project pipeline in the medium term.

The impacts of COVID-19 are  continuously being monitored and evaluated for their short- and medium-term effects. Any deterioration in the political and economic climate might impact the outlook negatively. This includes, but is not limited to, the economic climate in several emerging markets, such as China, Turkey, Brazil and Argentina; the overall situation in the Middle East, including any potential sanctions; a deterioration in global trading conditions; and a negative Brexit scenario.