DSM announces 2021 results

Adjusted net profit increased 21% to €858m ($973.5m), with adjusted net operating free cash flow up 9%.

Geraldine Matchett and Dimitri de Vreeze, Co-CEOs, said, "2021 was a pivotal year for DSM and our people in which we accelerated our journey towards becoming a fully focused health, nutrition and bioscience company. In line with our purpose-led strategy, we took further significant climate action and set a more aggressive path toward net-zero. We also launched ambitious new food system commitments to target and measure where we can best make a meaningful impact on the health of people and the planet through our core activities.​

Both Nutrition and Materials realized strong results, as we continued to successfully navigate dynamic market conditions including global supply chain and logistics disruptions. We started to counter inflationary pressures in the second half of the year with appropriate pricing actions to offset cost increases, of which the first positive effects can be seen in the fourth quarter, with the remainder being effective as of 2022.​

We are well positioned going forward, with an exciting innovation portfolio of sustainability-focused solutions with considerable growth potential such as our methane-inhibiting livestock feed additive Bovaer. We have a positive outlook for 2022 in line with our mid-term strategic targets for our Health, Nutrition & Bioscience activities."​

DSM said it expects its health, nutrition and bioscience activities to deliver a high-single digit adjusted EBITDA increase. For the group, it expects a mid-single digit adjusted EBITDA increase, with a high-single digit adjusted net operating free cash flow increase. This outlook is based on DSM's expectation of a stable adjusted EBITDA in materials following the strong performance in 2021.

As of January 1 2022, DSM's new health, nutrition and bioscience (HNB) structure became effective. HNB consists of the previous reportable operating segments of nutrition (which included animal nutrition, human nutrition and other nutrition) and innovation. HNB is organized in three newly created business groups: food & beverage; health, nutrition & care; and animal nutrition & health.

DSM said it sees significant headroom for further growth and innovation by building on its business model combining 'global products' and 'local solutions' and by adding a third dimension of 'precision and personalization' that captures emerging big data, digital and bioscience capabilities. In the new structure, DSM said it is also well positioned to address the huge environmental and societal challenges facing the global food system. 

DSM also announced a review of strategic options for its materials businesses in September 2021, including a possible change of ownership. From January 1, 2022 DSM said these businesses are managed largely on a stand-alone basis and will continue their existing growth strategies focusing their innovations and business development on the increasing demand for materials that protect the health of both people and planet by adding further bio-based and circular solutions.

The company was busy on the acquisition front. In March 2021, DSM acquired the flavor and fragrance bio-based intermediates business of Amyris, Inc., extending its offerings in personal care and aroma ingredients.

In July 2021, DSM acquired full ownership of Midori USA, Inc., a biotechnology start-up developing targeted eubiotics for animals, while in October, it acquired First Choice Ingredients, a US supplier of dairy-based savory flavorings for a wide range of food and beverage applications including plant-based alternatives. First Choice Ingredients has annual sales of about €70m ($79.4m). In December 2021, DSM acquired Vestkorn Milling, a producer of pea- and bean-derived ingredients for plant-based protein products with annual sales of about €20m ($22.7m).

In April, DSM closed the sale of DSM's Resins & Functional Materials and associated businesses to Covestro AG. DSM received about €1.4bn ($1.59bn) net in cash. DSM's remaining solar back sheet business was sold to Worthen Industries, Inc. in June 2021. In October 2021, DSM received about €300m ($340m) net in cash from the sale of its minority share in AOC.

Throughout 2021, DSM said it made further progress on improving its environmental footprint and in August announced an acceleration of its greenhouse gas (GHG) scope 1 and 2 emissions reduction ambitions. Within this context, DSM will also highlight progress on its scope 3 target, originally set in 2019, going forward. Chiefly attributed to purchased goods and services, a company-wide supplier engagement program CO2REDUCE was expanded during 2021 to target those that contribute the highest GHG emissions in DSM's value chain.

DSM said it remains ahead of its purchased renewable electricity target, with all North American sites becoming the latest to switch to 100% renewable electricity as part of a company-wide energy transition program. DSM's climate targets are reviewed and validated by the Science Based Targets initiative, providing a roadmap to achieve net zero by 2050 in line with the Paris climate agreement.

In September 2021, DSM announced a series of quantifiable commitments aimed at addressing urgent societal and environmental challenges linked to how the world produces and consumes food. These commitments cover areas where the company believes, together with its partners, it can support the transformation of the global food system and make the greatest positive impact on the health of the planet, the health of people, and healthy livelihoods. DSM will seek to obtain reasonable assurance on these new commitments from the first full year, 2022, and to report its progress alongside its impact reporting every year in its integrated annual report.