Performance 2022 in Animal Nutrition & Health

The year 2022 saw the unwinding of the exceptional 10% volume growth of 2021 that had been driven by COVID-19-related supply chain disruptions. With a modest decline for the full year, the resulting average rate of growth over the past three-year period of around 4.5% is in line with DSM’s long-term growth rate. As farmers continue to focus on optimizing feed efficiency yields, DSM’s performance solutions, such as enzymes, gut health solutions and mycotoxins, showed good growth.

Continuous pricing actions were taken through the year to mitigate rising cost inflation. Overall, the business realized a 7% price increase for the year, albeit with a continued price-cost gap as energy and raw materials cost inflation accelerated. Lower vitamin prices impacted pricing as from September.

Demand for animal protein overall remained resilient. Poultry and eggs performed well, while pork improved in the course of the year, helped by the normalization of the swine market in China. Ruminants and aquaculture saw more challenging conditions, owing to their relatively high price points against weakening consumer purchasing power.

The business realised an Adjusted EBITDA of €546 million with a full-year Adjusted EBITDA margin of 14.4%, which includes a dilutive mathematical effect from rising prices (higher sales and therefore relatively a lower margin percentage) and foreign exchange effects. Margins in the fourth quarter were further negatively impacted by lower vitamin prices and inventory reduction actions.