Business performance – Group Excellent financial performance 2020 guidance delivered As the COVID-19 pandemic continued to have an impact on a global level, Givaudan sustained good business momentum whilst maintaining its operations and global supply chain at a high level, despite ongoing challenges in certain parts of the supply chain. The strong sales growth was achieved across all product segments and geographies, with the mature markets growing at 6.3% and the high growth markets at 8.3% on a like- for-like basis. In Fragrance & Beauty the product segments most affected in the first phases of the COVID-19 pandemic, namely Fine Fragrances and to a lesser extent Active Beauty, delivered excellent double-digit growth in 2021, demonstrating strong consumer demand for these product categories. In Taste & Wellbeing, there was excellent sales growth in the beverage, savoury and snacks categories, as well as in the strategic focus areas of plant-based proteins, health and wellness and naturals. In addition, there was a progressive recovery in the foodservice segment, as restrictions in relation to out-of-home food and beverage consumption started to be eased in certain markets. With higher input costs in 2022, the company is implementing price increases in collaboration with its customers to fully compensate for the increases in input costs. Group sales Givaudan Group full year sales were CHF 6,684 million, an increase of 7.1% on a like-for-like basis and 5.7% in Swiss francs when compared to 2020. Gross margin The gross profit increased by 7.4% from CHF 2,659 million in 2020 to CHF 2,855 million in 2021. Due to the operating leverage related to the strong sales volume growth and continued cost discipline, the gross margin increased to 42.7% in 2021 compared to 42.1% in 2020. Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) The EBITDA increased by 6.0% to CHF 1,482 million in 2021 compared to CHF 1,397 million in 2020, whilst the EBITDA margin was 22.2% in 2021 compared to 22.1% in 2020. On a comparable basis, the EBITDA margin was 22.5% in 2021 compared to 22.8% in 2020. Operating income The operating income was CHF 1,089 million compared to CHF 996 million, an increase of 9.3% versus 2020. The operating margin was 16.3% in 2021 compared to 15.8% in 2020. Financial performance Financing costs in 2021 were CHF 94 million versus CHF 86 million in 2020, largely related to the increase in the net debt of the Group in connection with the acquisitions that the Group has made. Other financial expense, net of income, was CHF 30 million in 2021 compared with CHF 34 million in 2020. The income tax expense as a percentage of income before taxes was 15%, compared to 15% in 2020. Net income The net income was CHF 821 million in 2021 compared to CHF 743 million in 2020, an increase of 10.5%, resulting in a net profit margin of 12.3% versus 11.8% in 2020. Basic earnings per share were CHF 89.03 compared to CHF 80.59 for the same period in 2020. 7.1 % Sales growth (like-for-like) Givaudan – 2021 Integrated Annual Report 40 Financial value creation Bu siness performance – Group