Finance
Novonesis reports Q2 profits below market expectations
Published by Global Banking & Finance Review®
Posted on August 21, 2025
2 min readLast updated: January 22, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on August 21, 2025
2 min readLast updated: January 22, 2026
Novonesis's Q2 profits fell short of expectations, affecting shares. Key growth is driven by India's bioethanol blending and bioenergy trends.
(Corrects to India's bioethanol blending in fuels to be 35%, not 45% in paragraph 3; details of Russia exit in paragraph 9)
By Jesus Calero
(Reuters) -Danish biotech company Novonesis reported second-quarter profits which were below market expectations, sending its shares down 7% on Wednesday.
Global bioenergy markets are navigating shifting demand and pricing pressures, with some regions hit by inflation and evolving energy policies. In particular, India has emerged as a critical growth driver against this backdrop.
A government push for energy independence has sharply increased India's bioethanol blending in fuels, from 5% a few years ago to 25% today, and with 35% "very close", Chief Executive Officer Ester Baiget said in an interview.
Novonesis is targeting compound annual revenue growth 6% to 9% through 2030, with a core profit margin of 39%. Bioenergy is a key driver to reach these targets.
However, those negative effects were partly offset by local U.S. production,
"We're merging our solutions for bioenergy from corn and from biomass, upgraded into labelling solutions of yeast and an enzyme that our customers convert into biofuels," she said.
"For every single biofuel plant created in India, about 300 jobs are generated upstream and downstream," she added.
Beyond job creation, this demand reflects a broader geopolitical shift, with similar trends unfolding in Brazil and Southeast Asia where demand for biodiesel made from waste oil is accelerating, Baiget said.
Novonesis also exited Russia earlier this year, which had a modest impact on sales growth. The exit was due to the challenges of operating in that market following Russia's invasion of Ukraine, the company said.
"We're growing two times, three times, four times the market that we're present in," Baiget said.
(Reporting by Jesus Calero in Gdansk, editing by Milla Nissi-Prussak)
Bioethanol is a type of renewable energy made from plant materials, primarily used as a fuel additive to reduce greenhouse gas emissions.
Profit margin is a financial metric that shows the percentage of revenue that exceeds the costs of goods sold, indicating how efficiently a company is managing its expenses.
CAGR is a measure used to calculate the mean annual growth rate of an investment over a specified time period, assuming the investment grows at a steady rate.
Job creation refers to the process of providing new employment opportunities, often as a result of economic growth or business expansion.
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