Novozymes launches updated strategy
The strategy will enable more growth and value from the core business and make it possible to invest in new longer-term opportunities.
June 16, 2019 - Today, Novozymes announced the path to drive stronger growth over the three-year period 2020-2022. The updated strategy and consequent adjustments focus on better utilization of Novozymes’ core capabilities, making it possible to better prioritize high-impact pipeline projects, invest in new longer-term strategic opportunity areas and drive stronger commercial execution.
In the three-year period 2020-2022, Novozymes targets 5+% annual organic sales growth with 2020 likely negatively impacted by portfolio changes. By 2022, the company expects the EBIT margin to be at 28% or above and ROIC incl. goodwill at 23% or above.
“We will free up DKK 200-300 million from our existing portfolios, as well as from simplification and efficiency improvements. We will reinvest a significant part of that in new strategic opportunities, high-growth projects and commercial activities that generate improved performance over the coming years and create significant options and results for Novozymes and its stakeholders," says CEO Peder Holk Nielsen.
Setting the future direction
During the past years, Novozymes has developed a strong market position and today supplies biological solutions to more than 30 different industries. Its enzymatic and microbial solutions help bring biological answers to many of the global challenges we face today.
Overall, the financial performance is strong across key financials, but Novozymes has not delivered its full growth potential. External factors have had a negative impact on the business, and the company has not performed as expected.
“The updated corporate strategy, Better business with biology, sets the direction for Novozymes and will ensure that we will create more impact for our customers, for our business and for the world than we do today,” says CEO Peder Holk Nielsen.
Read more in the company’s official stock exchange announcement here
Non-financial targets by 2022
Novozymes has defined commitments for 2030 and targets for 2020-22 for three global challenges:
- Climate - Save 60 million tons of CO2 in the transport sector
- Water - Reach more than 4 billion people with laundry solutions
- Production & Consumption: Gain 500,000 tons of food by improving farm-to-table efficiency