In this year's Leaders & Newsmakers issue, newly inducted Symrise CEO Jean-Yves Parisot, Ph.D., shares insight into the impressive number of acquisitions and investments of the company in the last 12 months as well as technical advancements made across segments.
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In this year's Leaders & Newsmakers issue, newly inducted Symrise CEO Jean-Yves Parisot, Ph.D., shares insight into the impressive number of acquisitions and investments of the company in the last 12 months as well as technical advancements made across segments.
Symrise
Holzminden, Germany
2023 Sales:
What was your company’s biggest business accomplishment in the last year?
2023 was again a successful year of growth for Symrise. We enhanced our portfolio very positively through targeted acquisitions and strategic partnerships. With the transition of CEO responsibilities to Jean-Yves Parisot, Ph.D., in early April 2024, Symrise is ready to shape the next chapter of its success story.
Putting this in numbers: The Symrise Group generated sales of € 4,730 million in the 2023 fiscal year, an increase of 2.4 % in the reporting currency. Excluding portfolio and currency translation effects, organic sales growth amounted to 7.9 % with a total of € 903.5 million, adjusted earnings before interest, taxes, depreciation, and amortization (adjusted EBITDA) This corresponded to a margin of 19.1 %. Net income attributable to the shareholders of Symrise AG amounted to € 340 million. Earnings per share achieved €2.44.
Symrise CEO, Jean-Yves Parisot, Ph.D.courtesy of Symrise
Cash flow from operating activities of €720 million was significantly above the previous year’s level, driven mainly by a reduction in working capital and lower tax payments compared to 2022. The operating cash flow rate relative to sales amounted to 15.2 %.
The equity ratio of 47.0 % was slightly above the prior-year level. Symrise therefore has a very solid basis for the continuing sustained development of its business.
After the end of the fiscal year, Heinz-Jürgen Bertram, Ph.D., has handed over the CEO position to Parisot, already a member of the Executive Committee and in charge of the segment Taste, Nutrition & Health, as new CEO effective March 31, 2024. The Supervisory Board also renewed the contract of Parisot for another four years until the end of September 2028. Heinz-Jürgen Bertram, Ph.D., is retiring in the best mutual consent and agreement after 21 years of service at Symrise, of which 19 as a member of the Executive Committee and 15 as CEO.
Also, Symrise expanded its Executive Board in spring 2023 and has hired the experienced manager Stephanie Cossmann, Ph.D., to take over the newly created executive responsibilities for the Human Resources and Legal group. At the same time, Jörn Andreas, Ph.D., has taken over the Scent & Care segment.
Moving to sustainability, the figures in the Sustainability Record 2023 clearly demonstrate that Symrise achieved key sustainability targets last year. For example, the Holzminden-based Group was able to increase the share of strategic biological raw materials from sustainable sources to 95%. This mainly resulted from the more stringent monitoring of its entire value chain and closer collaboration with its suppliers. In compliance with the German Supply Chain Due Diligence Act, Symrise performed sustainability risk assessments of all its suppliers. Seventy percent of them also reported on their own emission reduction measures last year.
In addition, with its transition to sustainable processes, Symrise improved the eco-efficiency of chemical oxygen demand in wastewater by 10.7%. It also made progress in cutting water consumption, with a reduction of 30.9% at dry locations in countries such as Egypt, India, Mexico, Spain, and Chile. Moreover, the company reduced greenhouse gas emissions from purchased raw materials and services in the supply chain (Scope 3) by around 43% between 2016 and 2023.
Taken together, these successes are enabling the company to achieve its overarching climate goals. From 2030, Symrise aims to operate net zero for direct emissions (Scope 1) and indirect emissions from purchased energy (Scope 2). The company is seeking to reduce emissions in the supply chain (Scope 3) by 30%. It intends to achieve net zero Group-wide by 2045.
What were your biggest technical advancements/key acquisitions for the last year?
Technical advancements: In the Taste, Nutrition & Health segment, work continued systematically using digital tools in our principal areas of research such as sugar, salt and fat reduction and improving the taste of plant proteins as meat substitutes or alternatives to dairy products. To this end, special statistical processes were optimized and applied, making a significant contribution to reducing project development cycles. Symrise presented an example of this way of working at the 21st FEI Cooperation Forum entitled “Characterization, processing and use of plant proteins – Concepts for foods of the future” held in Bonn on April 18, 2023. A further use of modern digital tools in identifying flavors to reduce sugar in food applications was presented by Symrise in a paper entitled “Identification of taste actives from cultural food heritage via combined text-mining and senso- analytical approach” that was delivered at the 13th Wartburg Symposium held in Eisenach on October 3, 2023. At the same conference, the company also presented current findings from citrus research in a paper entitled “Molecular-sensory decoding of Citrus latifolia Aroma” and described biotechnological approaches to manufacturing taste-balancing raw materials in a paper entitled “Biotransformation of flavonoids by fungal mycelium from edible Lentinus spp. to produce taste active flavonoids with isovanilloid motif.” The further development of our citrus expertise is of significant importance considering the widespread use of these products in beverages, sweets, and other foods. That is why the molecular-sensory decoding process developed by Symrise is crucial for the exact characterization of flavor molecules and their combinations. This information is used by our developers and application technologists to create authentic product solutions for our customers. The use of renewable raw materials is becoming increasingly important in continuing to evolve selected technologies for the formulation of fragrances and product solutions. In this regard, Taste, Nutrition & Health presented its current work on spray drying coacervates on plant protein at the 21st Gums and Stabilisers for the Food Industry Conference that took place in Greece in July 2023.
The research and technology strategy is being implemented based on various research platforms. A large number of key topics are being worked on with a special focus on sustainability aspects. In the Food & Beverage division, examples include the development and adaptation of new, gentle and environmentally friendly separation technologies (Selective Enrichment Technologies Flavors SETFlavorsa) and the expansion and elaboration of raw material sources for sustainable and natural product solutions for the Symrise code of natureb platform, which are primarily used for healthy food concepts; the continuous development of natural and sustainable raw materials for flavor solutions that lead to the sensory-preferred reformulation of low-sugar, low-salt and low-fat food concepts; and the development of energy-efficient and low-solvent methods for concentration, beginning with plant-based raw materials. In 2023, a special focus was placed on the challenge of improving the taste of plant proteins as meat substitutes or for use in dairy products. Another focus is on reducing sugar in beverages and dairy products as well as in savory applications. In this context, the selection of varieties and new cultivation methods for a sustainable supply chain were developed and established for specific plant-based raw materials for the Taste Balancing product platform. Another focus of research in the Taste, Nutrition & Health segment is the development and application of modern digital tools for the rapid and targeted development of flavor solutions for selected food applications. The ProtiScanc process – developed by Symrise for recording the flavor release from innovative food preparations made with vegetable protein – is noteworthy in this context and was developed further in 2023. This process enables a significant reduction in project development times and forms a solid foundation for IT-based development concepts.
In addition, work is being conducted on the continuous improvement of product safety and the targeted optimization of the use of flavor solutions for application in reduced sugar and plant protein-based foods. In recent years, particular attention has been given to the development of digital prediction tools to support flavor development and creation. A sizable portion of this work was continued and completed in 2023 and grouped under the umbrella term “PropheSY”.
Probi and the Naturals business unit have launched a joint project to develop new symbiotic products containing live microorganisms and polyphenols extracted from fruits.
Regarding its R&D strategy, the Scent & Care segment focuses on raw materials and technologies in accordance with the Fragrances division’s strategic research fields of captives and ingredients, delivery systems, health and emotion, and malodor. The strategic field of captives and ingredients is researching individual perfume raw materials for the Fragrance and Oral Care business units. In the case of new synthetic substances (captives) based on petrochemicals and renewable raw materials, the focus is on floral, woody, and musky fragrances. In respect of the captives based on natural raw materials such as roots, flowers and fruits, work is concentrated on the strategic fields of biodiversity essential oils, natural technologies (Supernature) and artisan. In 2023, Cocoa Shell Madagascar, Neroli Oil Egypt, Supernature Sympep, Apple Symtrap, Strawberry Symtrap, Banana Symtrap and Blackcurrant Symtrap were added to the portfolio.
Research is also being conducted to find inexpensive raw materials for perfumery. Symrise has also added Natural Neofreshd to its Neofresh platform to meet customers’ desire for sustainable products made from renewable raw materials.
Having continued the development of its combined expertise in fragrances and pet food, especially for dogs and cats in recent years, Symrise is now deploying these developments increasingly in direct customer projects.
The marketing of Symcap BGe biodegradable capsules has generated a great deal of interest from some customers for use in fabric softeners. Research for capsules for fragrance oils is now heading to vegan capsules with improved efficacy for other areas of application as well. There is also growing customer demand for vegan capsules. Symcap BG contains gelatin, so an alternative raw material based on pea protein has been found and developed into the new Symcap BP capsule that is market-ready. There is also increasing demand for kosher and halal products.
The Oral Care business unit has developed Fuji, a new cooling agent that is expected to be market-ready in 2024.
Research for the Aroma Molecules division is focused on improving existing manufacturing processes for market products such as menthol and on increasing process efficiency.
In the Cosmetic Ingredients division, there is an interdisciplinary group of cell biologists, molecular biologists and microbiologists researching the human microbiome. The new research area is investigating the benefits and risks of interactions between humans and microorganisms and is providing scientific and cross-divisional support in the development of new products for skin, scalp, and oral care, or in nutrition. The first products and product concepts have already been introduced to the market. In addition, in-depth analyses on healthy volunteers showed that neither multifunctional active ingredients nor modern UV filters influence the microbiome. In 2023, microbiome expertise was expanded to the armpit. The proprietary ex vivo model developed to identify active ingredients for deodorants was presented at a number of conferences, including the International Federation of Cosmetic Chemists and Scientists (IFSCC) Congress. It is expected that the first active substance based on the research model and the specific method will be market-ready in 2024.
Patents & Awards
The number of patents filed (34 new applications in 2023) is used to measure innovation results and quality and to evaluate global coverage and competitive impact.
In 2023, as in previous years, Symrise research was recognized with awards for its high level of innovation. Launched in 2023, the yarrow-based Supervisomef EPH received two awards: a European BSB Innovation Award in the “Cosmetics/Raw Materials/Actives” category and the Pure Beauty Award UK. The product is manufactured in a special process that extracts the juice from fresh, organically grown yarrow and spray dries it to yield a stable raw material that, when used in cosmetic products, is proven to give the skin a more even appearance. Also launched in 2023, SymProt’in™ Oat is manufactured by enzymatic extraction from organically grown oats and is rich in hydrolyzed proteins. Thanks to its special composition, the product helps to protect the structure of hair and received the BSB Award in the “Natural Products/Raw Materials/Actives” category. SymHairg Thermo, which was already launched in 2022 and has garnered numerous awards, won the Pure Beauty Global Award in the “Best Ingredient” category. It is a sustainable product that combines carbohydrates with different chain lengths, providing outstanding protection for the hair against thermal damage. Launched back in 2020, Crinipan PMC green impressed another jury in 2023 to win the prestigious PCHi Fountain Award in the “Hair Care/Scalp Care Ingredient” category. The product delivers proven efficacy against dandruff and satisfies consumer demands for environmentally compatible products.
The above technological advancements have led to a number of product innovations across all business areas.
Product innovation: Symrise has launched a collection of multifunctional ingredients for household care products. In addition to classic cosmetic ingredients, the company is now also offering multifunctional ingredients for household care products in this category. The multiple multifunctional ingredients improve cleaning performance, product aesthetics and enhance formula protection of products such as laundry, dishwashing, and surface care detergents. The demand for high-performance sustainable cleaning agents is growing rapidly while regulatory requirements for manufacturers constantly change. The Symrise ingredients assist with this change and support sustainability by reducing impact on the environment.
Symrise has introduced SymEffect™ UV and expanded its functionals portfolio. The synergistic mixture of renewable ingredients enhances the effectiveness of organic and mineral UV filters. It also improves the sustainability profile of sunscreens because of its natural raw material base. With this product launch, Symrise is responding to the trend towards sustainable sun care.
Symrise has launched a new range of diana foodh bioactives for use in Beauty from within products. The company is expanding its offer with the development of these differentiating and innovative nutricosmetic ingredients. The range includes a full line of solutions for skin conditioning and anti-aging, skin brightening, as well as hair and nail care. It is composed of naturally sourced bioactives, such as collagen type I, vitamins C & A, and polyphenols from various fruits.
Symrise has introduced its tropolone-based SymDiol 68T and SymOcide PT. New data confirms the antioxidant effect of tropolone: It works effectively to protect from primary and secondary free radicals and stabilizes organic compounds that prevent oxidation. It also reduces protein oxygenation by 60% and the formation of peroxides in sunflower oil by 45%. Thanks to these properties tropolone supports the product protection system of formulations.
SymCalmini Avena made from certified organic oats – can help soothe the skin and regulate its moisture balance. The product's effectiveness is on par with that of established substances. It also scores points for its sustainability. SymCalmin Avena has received the COSMOS certificate for its organic ingredient base. The organic oats come from regional sources in Germany.
Symrise has launched a range of diana food chickpea and aquafaba ingredients with multiple benefits. The range is backed by the expertise of Symrise in sourcing, quality, and food safety. The ingredients open opportunities in the development of plant-based food products with cleaner labels.
Symrise has introduced Crinipanj PO, an anti-dandruff active. The premium-grade ingredient offers proven efficacy and an option to replace zinc pyrithione when needed. Used in shampoos or other hair care products, it effectively combats dandruff, ensuring a flake-free scalp. Piroctone olamine, alongside zinc pyrithione, and climbazole, stands as one of the top traditional anti-dandruff actives globally. This product complements the comprehensive dandruff control portfolio of Symrise, offering versatility for all customer needs.
Some of our notable acquisitions in the last year include: Symrise has announced to participate in the Series A funding round of Ignite Venture Studio. The U.S.-based company creates and invests in global innovative start-up ventures associated with beauty, health, and wellness. By investing in Ignite Venture Studio, Symrise will expand its expertise in this market environment and grow alongside the creativity, and speed of the personal care industry. The partnership will further enable the development of tailored fragrance and cosmetic solutions in accordance with the latest consumer demands.
For its recent capital increase, Danish biotech company EvodiaBio was looking for strategic investors. Symrise joined the group of international contributors to support the fast-growing start-up. EvodiaBio has developed a ground-breaking technology platform that uses precision fermentation to produce sustainable taste for the food and beverage industry, with the potential to go beyond this market. Symrise looks forward to the future collaboration.
Symrise announced a strategic investment in Synergio. The biotech company specializes in the development of natural and sustainable solutions using advanced plant-based technology for consumer goods products. Symrise considers this investment a strategic step to expand its leadership position in the product protection business in the personal care industry. Symrise will acquire a minority ownership in Synergio with the possibility to acquire a majority stake in Synergio’s share capital in the future.
Symrise AG has signed a minority investment agreement with Bonumose. The early-stage food ingredient manufacturer specializes in the affordable production of delicious, good-for-you rare monosaccharides (alternatives to sucrose) such as tagatose and allulose. With this strategic transaction, Symrise will accelerate growth in its sugar reduction initiatives. The area represents a high-priority focus for the North America region within the Taste, Nutrition & Health segment.
Symrise AG has increased its holdings in the U.S. company Kobo Products Inc., a pigment and powder specialist. The transaction creates further opportunities for both companies in the fields of mineral UV filters and decorative cosmetics. Kobo customers will also benefit from expanded capacities and global supply chains.
Symruse filed 34 new applications in 2023 to measure innovation results and quality and evaluate global coverage and competitive impact.courtesy of Symrise
What are the key factors/trends shaping innovation in F&F in 2023?
1. Sustainability and natural ingredients: Sustainability continued to drive the F&F industry. Consumers increasingly demanded safe and effective and environmentally friendly products. We address this with the increased use of natural and bio-based ingredients, as well as increasing efforts to ensure sustainable sourcing and reduce carbon footprints across production processes.
2. Health and Wellness: The growing consumer focus on health and wellness significantly influenced the F&F sector. We saw an increased demand for products that contribute to wellbeing, including functional fragrances with benefits such as mood supporting, and immune system support. Taste solutions that promote health, such as those with reduced sugar, salt, and fat, or enhanced with vitamins, also gained popularity. Our broad portfolio offers solutions for all those areas.
3. Technological Advancements: Advances in technology played a critical role in innovation within the F&F industry. We evolved our tools involving artificial intelligence (AI) and machine learning for scent and taste creation, improving the speed, efficiency, and sustainability of product development. Additionally, we employed biotechnology for creating novel ingredients and achieving flavors and fragrances that are hard to extract from natural sources.
4. Personalization: Another trend we observed, links towards increased personalization, with consumers seeking products tailored to their specific preferences and needs. We facilitate this by developing customized fragrance and taste experiences, enabled by digital technologies that allow customers to create unique products.
5. Cultural and demographic shifts: Changes in consumer demographics and cultural shifts continue to influence taste and fragrance preferences. For instance, the growing multicultural populations in many countries lead to an increased appetite for global, exotic, and ethnic tastes and scents.
Could you share your insights on the impacts of evolving regulatory updates?
Regulatory updates exert a profound impact on the flavor and fragrance (F&F) industry ranging from product formulation to marketing strategies.
1. EU Taxonomy & EU Green Deal: Through the introduction of the EU Taxonomy, the European Union has classified environmentally sustainable business activities. Beginning in 2023, companies must demonstrate how they will incorporate six environmental goals into such areas as their capital expenditures or production technologies. Because Symrise’s business model is sustainably structured per se, it has already well prepared itself for this work. The European Green Deal is designed to make the EU the world’s first net zero economic region by 2050. The EU Taxonomy is an important aspect of this plan. This uniform classification system is aimed at channeling private and public investments in a way that will finance the transformation to a sustainable economy. The EU has defined six overarching environmental goals to structure the process: 1) Climate protection, 2) Climate change adaption, 3) Sustainable use and protection of water and marine resources, 4) Transition to a circular economy, 5) Pollution prevention and control, 6) Protection and restoration of biodiversity and ecosystems.
2. Product Reformulation: With new regulations, we may have to reformulate products. This can involve significant research and development to find suitable alternatives with the same sensory qualities, safety, or effectiveness. For example, regulations limiting the use of synthetic ingredients might push companies to explore natural alternatives, which can be more costly or variable in supply. At the same time, this can also drive innovation.
3. Compliance Costs: Adhering to evolving regulations typically increases operational costs. These costs arise from the need to conduct additional testing and certification, modify production processes, and manage more complex supply chains. Companies may need to invest in modern technologies or processes to meet these standards.
4. Consumer trust and brand image: Companies that proactively address regulatory changes and adopt more stringent safety and sustainability standards can enhance their brand image and build consumer trust.
In summary, regulatory changes pose challenges and offer opportunities to lead innovation. By adapting to these changes, we can improve our products and processes, ultimately benefiting both consumers and the environment.
Footnotes
aSelective Enrichment Technologies Flavors SETFlavors is a registered trademark of Symrise
bSymrise code of nature platform is a registered trademark of Symrise
cProtiScan trademark of Symrise
dNatural Neofresh is a registered trademark of Symrise
eSymcap BG is a registered trademark of Symrise
fSupervisome is a registered trademark of Symrise
gSymHair is a registered trademark of Symrise
hdiana food is a trademark of Symrise
iSymCalmin is a registered trademark of Symrise
jCrinipan is a registered trademark of Symrise
