IMCD has reported strong results for 2020, despite the Covid-related disruptions to markets and supply chains around the world. Revenues grew by 3 per cent to €2.77bn, gross profit was up 8 per cent at €647.5m, operating EBITA increased by 13 per cent to €253.5m and net profit rose 14 per cent to €178.1m.
“Much has been said about the impact of Covid-19 during 2020 and I can only repeat my gratitude to our dedicated staff who kept IMCD open for business during these trying times,” says CEO Piet van der Slikke. “We are in our 25th year of value creation for our suppliers and customers and we owe a big thank you to them as well, for their trust and partnership during all these years.
“2020 was also a year in which we accelerated our digital transformation and we successfully expanded our presence in several parts of the world,” van der Slikke continues. “This is testimony to our continuing ambition to be the global leading distributor in specialities and ingredients. Despite the uncertain times we live in, we are very positive about IMCD’s opportunities for further growth in the current year.”
Indeed, much of IMCD’s growth compared to 2019 can be put down to the impact of recent acquisitions. In the Europe, Middle East and Africa (EMEA) segment, for example, organic revenue growth slipped negative at -2 per cent, while first-time inclusions showed 5 per cent growth; this largely relates to the acquisitions of DCS in 2019 and Zifroni and Kokko-Fiber during 2020.
In the second half of 2020 IMCD agreed a number of other regional acquisitions, including South Africa-based Siyeza Fine Chem, Dutch pharmaceutical distributor Peak International Products and Turkish personal care specialist Eider Kimya; all three transactions closed in early January 2021 and will contribute to further revenue growth this year.
EYES ON ASIA
Overall, the EMEA segment increased revenues by 1 per cent over 2019 to €1.33bn, with gross profit up 4 per cent at €337.4m and operating EBITA up by the same percentage at €131.2m.
Revenues in the Americas segment fell by 4 per cent to €945.1m, mainly due to adverse currency movements, though there was also a drop in organic revenue growth, compensated once more by the impact of recent acquisitions, including Unired and DCS Mexico in 2019 and VitaQualy, Millikan and Banner Química in the second half of 2020.
The Asia-Pacific segment showed significant growth, with revenue up 28 per cent at €502.9m, gross profit ahead by 32 per cent at €105.9m and operating EBITA growing by 48 per cent year-on-year to €52.9m, despite negative currency movements. In this region, organic growth accounted for 11 per cent of the increase in revenue, and acquisitions 21 per cent. IMCD says it “continued with the execution of its selective acquisition strategy,” buying the pharmaceutical business of Shanghai-based Develing International in July 2020 and a 70 per cent shareholding in Indian excipients distributor Signet in November.
This is unlikely to be the end of IMCD’s expansion. It says it sees “interesting opportunities” to further increase its global footprint and expand its product portfolio both organically and by acquisition during 2021. Meanwhile, it also warns that the ongoing Covid-19 pandemic leaves the extent of its impact on the global economy uncertain. However, IMCD’s strong and diverse business and its “robust liquidity position and capital structure” leave it confident of being about to ride out the worst effects.