DSM-Firmenich to Launch up to 1 Billion Euro Buyback After Strong Results

DSM-Firmenich Announces Up to €1 Billion Share Buyback Following Strong Profits

By Alberto Chiumento

(Reuters) - European chemicals maker DSM-Firmenich on Thursday announced a new share buyback program and said it expected its adjusted core profit to rise to at least 2.4 billion euros ($2.5 billion) in 2025.

The group, born out of a 2023 merger of Dutch DSM and Swiss Firmenich, said it would launch the buyback in the second quarter of 2025 for an initial amount of 500 million euros, which would later be increased to up to 1 billion euros.

Its shares rose 3.5% by 1040 GMT. Barclays analysts said the buyback plan was the "key positive surprise" of the day.

At 1 billion euros, the buyback would represent around 4% of the company's current market share, Jefferies analysts added in a note.

DSM-Firmenich, which supplies fragrances used in the perfumes of French luxury giants LVMH and Kering, reported adjusted core profit of 2.12 billion euros for 2024, just above market expectations.

"We had very good results for 2024, with an organic (sales) growth of 6%," CEO Dimitri de Vreeze told Reuters.

As part of its sharpening focus on perfumes and flavours, DSM-Firmenich said in February 2024 it planned to carve out its Animal Health and Nutrition business by the end of 2025, without specifying the means.

The group will start meeting investors interested in the unit next week, it said on Thursday, after it agreed to sell its stake in enzymes joint venture to partner Novonesis earlier this week.

"It's a little bit like you're selling your house, you announce you're selling your house, but now we're announcing that everything is ready to be sold and you invite possible interest candidates to visit your house," de Vreeze said.

DSM-Firmenich proposed a dividend of 2.50 euros per share for the year, the same amount it had paid out in 2024.

($1 = 0.9584 euros)

(Reporting by Alberto Chiumento in Gdansk; editing by Milla Nissi and Kim Coghill)