Danisco

Groundbreaking enzyme product launches

Pressmeddelande   •   Okt 13, 2005 12:00 CEST

Danisco’s acquisition of Genencor earlier this year signalled Danisco’s firm belief in the growth potential of the fermentation technology platform, i.e. enzymes and cultures which now represent approximately 30% of the total ingredients business.

This technology perspective was also a driver for the USD 20 million R&D collaboration agreement entered with Genencor in October 2001 aimed at accelerating the development of new food enzymes. The introduction of two new enzymes for the baking industry is the first major result of the multi-year R&D effort of the combined Danisco and Genencor organisations.

Danisco sees significant business potential from the two new enzyme products, primarily for the baking industry where our market share is around 20% today. Danisco’s existing capabilities for the food industry in terms of application knowledge and distribution power are important drivers for expanding the sales potential of the new enzyme products.

GRINDAMYL™ POWERBake – new baking enzyme
GRINDAMYL™ POWERBake is a strengthening enzyme (glycolipase) for the baking industry. With its ability to make flour perform more effectively in the baking process the enzyme is an important factor in optimising the industrial bread production processes. The better usage of flour will result in more uniform and high-quality bread products to the consumers.
The new enzyme is part of Danisco’s POWERBake product range and targets an estimated annual market value of DKK 500 million according to Jan Sindesen, President Danisco Specialities. The new enzyme is expected to expand the existing market potential and support sales of Danisco’s other products to the baking industry such as emulsifiers. Danisco aims to achieve a significant market position for this product category, although a global market introduction will run over a couple of years.

GRINDAMYL™ MAX-LIFE – new shelf-life enzyme
GRINDAMYL™ MAX-LIFE is an enzyme (special amylase) that helps maintain the soft and fresh texture in bread and prevents the development of a dry and hard crumb structure and crust. This is an important functionality for the baking industry, as it extends the shelf life of bread, reducing retailers' waste. The main application is in sandwich bread products, which are mainly sold in North America, Europe, Japan and Australia.
'This enzyme segment is an attractive market for Danisco today,' states Jan Sindesen. Previously, Danisco did not have its own product alternative in the product range offered through our global sales and distribution organisation to the baking industry. The enzyme will enable Danisco to go for a considerable market position in this product category, which currently has an estimated market value of around DKK 600 million annually.

Greater visibility in synergy guidance for Genencor
The full-year 2005/06 EBIT guidance for Genencor of DKK 200 million was reiterated in the Announcement of Results for Q1 2005/06. However, cost synergies are now accounting for a greater proportion of the total synergies than originally expected following a complete strategic review of the overall enzyme platform after the acquisition of Genencor. In this context it is also important to highlight our recent construction start of a new enzymes production facility in Wuxi, China.
Synergies coupled with Genencor's own growth forecast means that return on invested capital in the third full year after the acquisition is expected to exceed the cost of capital (WACC) of 7.5%, thereby fulfilling our financial targets.

For further information, please contact:
Jan Sindesen, President, Danisco Specialities, tel.: +45 3266 2000
Carl Johan Corneliussen, Media Relations Manager, Tel. +45 3266 2926
Hans Gregersen, Investor Relations Manager, tel.: +45 3266 2925