Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 B agsvaerd Phone +45 4446 0000
Ester Baiget, President & CEO:
“With 9% organic sales growth in the first nine months and a strong start to the
fourth quarter, we are well on track to deliver on our guidance upgrade from October 7. This also includes delivering
on the sales growth indications for each of our five business areas. Our efforts to enhance Novozymes’ commercial
capabilities are progressing well, and with more than two thirds of the price increases for 2023 already committed,
we feel comfortable with our 25%+ EBIT margin expectation. We continue to focus on the future and make
significant investments in strategic areas. Combined with a well-diversified product portfolio and end-market
exposure we are well positioned to deliver on our growth ambitions”.
Sales and financial performance:
• Sales growth in DKK at 17% (9% organic, 7% currency, 1% M&A), Q3 DKK sales growth at 16% (6% organic,
9% currency, 1% M&A).
• Broad-based and strong performance across the business:
o Bioenergy 26% (Q3: 32%): Strong growth across regions and applications, led by the North and Latin
America, driven by a broad and innovative solution toolbox in a favorable market environment.
o Grain & Tech Processing 11% (Q3: 7%): Strong performance led by double-digit growth in Grain, driven
by favorable market conditions and innovation. Tech Processing also grew, although at a lower rate.
o Food, Beverages & Human Health 8% (Q3: 2%): Broad-based growth, led by innovation, a focus on
healthy choices, and supported by an environment focused on yield and optimization. Human Health
performed well with double-digit growth in Q3, whereas Food was negatively impacted by timing.
o Agriculture, Animal Health & Nutrition 7% (Q3: –7%): Solid performance driven by strong growth in
Animal Health & Nutrition. Agriculture declined in Q3 due to timing.
o Household Care 0% (Q3: -1%): Performance in line with expectations, including a negative impact from
the war in Ukraine, especially in the third quarter.
• Organic sales growth: developed markets 10% (Q3: 9%); emerging markets 7% (Q3: 1%).
• EBIT margin at 27.2% (Q3: 29.5%). Adjusted for nonrecurring items affecting y/y comparability, the EBIT
margin was around 26% (Q3: ~25%). Gross margin lower as expected from higher input, logistics and energy
costs, partly offset by productivity improvements and slight price increases, also in Q3. The gross margin in Q3
additionally impacted by negative mix due to sales timing whereas the 21
st
.BIO accounting gain impacting
other operating income positively.
• Net profit strong with an increase of 11% (Q3: 37%).
• ROIC incl. goodwill at 17.8%, impacted by lower EBIT margin, acquisitions and growth investments.
• FCF before acquisitions at DKK 1.5bn, including stronger operating cash flow and higher investments
including the Advanced Protein Solutions production line in Blair, US.
• A solid balance sheet with a net-debt/EBITDA ratio of 1.0x.
Key events:
• Thirteen product launches in the first nine months of the year of which nine were public. This includes seven
product launches in the third quarter of which three were public.
• Selection of locations for customer co-creation centers in North America and Europe finalized.
• Participation at UNGA in New York with the focus on accelerating the transition towards a greener economy.
• In October, aligned with the company’s strategic direction, Novozymes signed an agreement to divest selected
waste-water treatment products, with expected closing in 2023.
2022 outlook:
• Strong start to the fourth quarter confirms the 8-9% full-year organic sales growth outlook. This follows the
third quarter sales that was impacted by timing in Food, Beverages & Human Health and Agriculture, Animal
Health & Nutrition.
• The outlook for EBIT margin and ROIC, incl. goodwill is maintained whereas FCF bef. acq. is reduced by DKK
400m due to phasing between 2022/2023, as the construction of the Advanced Protein Solutions production
line in Blair is progressing very well within the maintained timeline and investment level of DKK ~2bn.
9M
2022
9M
2021
Q3
2022
Q3
2021
2022 outlook
November 3
2022 outlook
October 7
Sales performance, organic
%
9
6
6
7
8-9
8-9
EBIT margin
%
27.2
28.8
29.5
29.1
26-27
26-27
ROIC, incl. goodwill
%
17.8
20.6
17-18
17-18
FCF, before acquisitions
DKKbn
1.5
2.7
0.5
0.9
1.3-1.7
1.7-2.1
9M 2022
9%
Organic sales
growth
27.2%
EBIT margin
17.8%
ROIC, incl.
goodwill
1.5
FCF before
acq. DKKbn
Full-year upgrade from October 7 confirmed by a strong start to Q4
Conference call
November 3, 2022
9.00 CET
Please pre-register
for the call here
Webcast
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
2/26
Selected key data
9M 2022
9M 2021
Q3 2022
Q3 2021
Sales performance, organic
%
9
6
6
7
Household Care
%
0
0
-1
3
Food, Beverages & Human Health
%
8
15
2
16
Bioenergy
%
26
12
32
5
Grain & Tech Processing
%
11
12
7
4
Agriculture, Animal Health & Nutrition
%
7
-3
-7
16
Sales
DKKm
13,024
11,117
4,367
3,761
Sales performance, DKK
%
17
5
16
10
Gross margin
%
54.9
58.2
53.8
57.9
EBITDA
DKKm
4,654
4,273
1,664
1,448
EBIT
DKKm
3,539
3,202
1,287
1,095
EBIT margin
%
27.2
28.8
29.5
29.1
Net profit
DKKm
2,809
2,522
1,153
843
Net profit performance
%
11
16
37
19
Net investments excl. acquisitions
DKKm
1,964
638
731
227
Free cash flow before acquisitions
DKKm
1,458
2,729
489
883
NIBD/EBITDA
x
1.0
0.9
ROIC, incl. goodwill
%
17.8
20.6
EPS
10.09
9.06
4.17
3.04
EPS (diluted)
10.01
8.99
4.14
3.01
Avg. USD/DKK
701
622
739
631
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
3/26
Sales by business area
Distribution of sales by business area, 9M 2022
Household Care
Household Care delivered flat organic sales performance for the first nine months of 2022 compared
to the same period last year, and sales in reported DKK grew 4%. The overall performance was in line
with expectations. Emerging markets performed well during the period, driven by a continued strong
performance in both Latin America and Asia Pacific, and despite the negative impact from the war in
Ukraine. In developed markets, sales to laundry and dishwash declined, primarily due to softness in
European market volumes. Both the cleaning and professional segments performed well across
geographies. Freshness performed in line with expectations with additional customer engagement
around the concept, and a newly launched exclusive partner solution in the third quarter.
Third-quarter sales declined 1% organically and grew 4% in reported DKK y/y. This was in line with
expectations, as developed markets grew, driven by North America, while emerging markets were soft
primarily due to the negative impact from the war in Ukraine.
Food, Beverages & Human Health
Food, Beverages & Human Health grew 8% organically in the first nine months of the year and by 18%
in reported DKK relative to the same period of last year. Growth was broad-based and supported by
customers’ additional focus on mitigating higher input costs. The year has been characterized by high
volatility in customer order patterns as also seen in Novozymes quarterly sales performance.
Food performed well across segments, mainly driven by innovation, ingredient substitution and
optimization of raw materials. Beverages performed very well, benefitting from market trends favoring
low-carb beer as well as higher and more volatile raw material prices. Growth in sales of solutions for
plant-based proteins was supported by increased penetration due to innovation, and Human Health
saw solid underlying in-market demand for health-focused solutions.
Organic sales growth was 2% in the third quarter and 13% in reported DKK year-on-year. This was
softer than expected and impacted by timing in customers’ order patterns between the third and the
fourth quarter, particularly in Food. Growth was supported by Beverages as well as by double-digit
growth in Human Health, while the sales of solutions for plant-based proteins performed well in
developed markets.
Bioenergy
Bioenergy sales grew 26% organically in the first nine months of the year and 40% in reported Danish
kroner compared to the same period of last year. Novozymes' strong performance was driven by a
broad and innovative solution toolbox allowing for higher yields, throughput, and by-product value
capture for producers in a favorable market environment. The North American market experienced
strong developments overall, supported by increased U.S. ethanol production. According to the EIA,
29%
24%
20%
15%
12%
Household Care
Food, Beverages & Human Health
Bioenergy
Grain & Tech Processing
Agriculture, Animal Health &
Nutrition
Organic performance / Performance in DKK
7% / 15%
0% / 4%
11% / 19%
8% / 18%
26% / 40%
Total sales 9M y/y
Organic: 9%
DKK: 17%
Household Care 9M y/y
Organic: 0%
DKK: 4%
Food, Beverages & Human
Health 9M y/y
Organic: 8%
DKK: 18%
Bioenergy 9M y/y
Organic: 26%
DKK: 40%
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
4/26
U.S. ethanol production increased by an estimated 4% in the first nine months of the year compared
to the same period last year. Outside of North America, performance was also strong and driven by
innovation, capacity expansion of corn-based ethanol production in Latin America and supported by
growth in solutions for biodiesel production.
In the third quarter, Bioenergy sales grew 32% organically and 51% in reported currency compared to
the same quarter last year. Similar to the nine-month performance, growth was mainly driven by
innovation supported by market volume growth in both North and Latin America. In addition, sales of
enzymes used in second-generation biofuels, commonly referred to as biomass conversion, did well
and contributed to growth in the quarter. As estimated by the EIA, U.S. ethanol production grew
around 1% in the third quarter compared to the same quarter of last year.
Grain & Tech Processing
In the first nine months of 2022, Grain & Tech Processing sales grew 11% organically and 19% in
reported Danish kroner. The strong performance was mainly driven by double-digit growth in Grain,
with a strong performance in both developed and emerging markets, supported by innovation and
favorable market conditions. Tech Processing also grew organically, although at a lower rate, and was
supported by strong sales of enzymes used for COVID-19 testing kits.
In the third quarter, Grain & Tech Processing sales grew 7% organically and 16% in reported Danish
kroner, compared to the same period last year. Similar to the nine-month performance, growth in Grain
was broad-based, with double-digit growth in both developed and emerging markets, whereas sales in
Tech Processing declined slightly.
Agriculture, Animal Health & Nutrition
Sales in Agriculture, Animal Health & Nutrition grew 7% organically and 15% in reported Danish kroner
in the first nine months compared to the same period last year. Innovation and favorable market
conditions, partly linked to higher soft commodity prices, increased demand for yield-enhancing
solutions across subareas. The performance was solid and driven by strong growth in Animal Health &
Nutrition, especially in developed markets, while the performance in Agriculture was soft.
Third-quarter sales declined by 7% organically and grew 3% in reported Danish kroner year on year.
As in the first nine months, Animal Health & Nutrition performed well and grew in the quarter. Third-
quarter organic sales in Agriculture declined due to timing of orders between the third and the fourth
quarters.
Sales by geography
Distribution of sales by geography, 9M 2022
Novozymes’ organic sales grew 9% year-on-year in the first nine months of 2022. The performance was
broad-based and led by 10% organic growth in developed markets, followed by 7% in emerging
markets. Growth in developed markets was mainly driven by strong performance in Bioenergy,
supported by double-digit growth in Agriculture, Animal Health & Nutrition and Grain & Tech
35%
33%
20%
12%
Europe, the Middle East & Africa
North America
Asia Pacific
Latin America
Grain & Tech Processing
9M y/y
Organic: 11%
DKK: 19%
Agriculture, Animal Health &
Nutrition 9M y/y
Organic: 7%
DKK: 15%
15% / 29%
Organic performance / Performance in DKK
5% / 7%
12% / 26%
8% / 18%
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
5/26
Processing. Growth in emerging markets was broad-based and primarily driven by Bioenergy, Food,
Beverages & Human Health and Grain & Tech Processing, all growing at or close to double digits.
In the third quarter, developed markets grew 9% and emerging markets grew 1% organically. Similar
to the performance of the first nine months of the year, the strong growth in developed markets was
mainly driven by Bioenergy. Performance in emerging markets was soft, primarily due to the war in
Ukraine impacting mainly Household Care and timing in Agriculture, Animal Health & Nutrition, while
Bioenergy performed well.
Europe, the Middle East & Africa
Sales grew 5% organically, with three out of five business areas growing at or close to double digits.
Growth was led by strong performance in Agriculture, Animal Health & Nutrition and Food, Beverages
& Human Health, whereas Household Care declined.
In the third quarter, sales grew 1% organically. The performance was mixed across business areas,
with solid growth in Agriculture, Animal Health & Nutrition, while Household Care was soft and
declined due to the war in Ukraine and soft European detergent market volumes.
North America
North America performed well and grew 12% organically y/y in the nine-month period. Growth was
driven by strong performance in Bioenergy as well as in Grain & Tech Processing.
Third-quarter sales also grew 12% organically, mainly driven by strong performance in Bioenergy and
growth in Household Care, while Agriculture, Animal Health & Nutrition declined.
Asia Pacific
Sales grew 8% organically in the first nine months of 2022 compared to last year. Growth was broad-
based, with all five business areas contributing, led by strong performance in Food, Beverages &
Human Health, Household Care and Grain & Tech Processing.
Sales in the third quarter grew 5% organically, mainly driven by Household Care and Grain & Tech
Processing.
Latin America
Organic sales grew 15% in the first nine months of the year, with four out of five business areas growing
double digits. Growth was led by a very strong performance in Bioenergy, while Agriculture, Animal
Health & Nutrition was somewhat soft and declined.
In the third quarter, organic sales grew 8%. As in the first nine months of the year, growth was mainly
driven by Bioenergy, while Agriculture, Animal Health & Nutrition was somewhat soft and declined.
Europe, the Middle East &
Africa 9M y/y
Organic: 5%
DKK: 7%
North America 9M y/y
Organic: 12%
DKK: 26%
Asia Pacific 9M y/y
Organic: 8%
DKK: 18%
Latin America 9M y/y
Organic: 15%
DKK: 29%
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
6/26
Income statement
Total costs excluding net other operating income, net financials, share of losses in associates and taxes
amounted to DKK 9,756 million in the first nine months and DKK 3,320 million in the third quarter of
2022. This was DKK 1,691 million (21%) and DKK 644 million (24%) higher, respectively, than in the
corresponding periods of 2021. The year-on-year increases in the nine-month period and in the third
quarter were mainly due to the higher cost of goods sold, which increased due to higher raw material
and logistics costs, as well as higher sales.
The gross margin was 54.9% for the first nine months and 53.8% for the third quarter. This corresponds
to a decrease of 3.3 percentage points compared to the first nine months of the previous year and a
4.1 percentage point decrease compared to the third quarter of last year. The lower year-on-year gross
margins were mainly a result of higher input and logistics costs as well as a negative product mix in
the third quarter, partly offset by productivity and operating leverage for the nine-month period.
Currencies provided a minor positive effect in the first nine months of the year and in the third quarter,
while sales prices made a slightly positive impact to the gross margin for the first nine months of the
year, with a growing contribution over the quarters.
Operating costs totaled DKK 3,886 million in the first nine months and DKK 1,301 million in the third
quarter of 2022. This was an increase of DKK 464 million (14%) and DKK 209 million (19%),
respectively, compared to the same periods of 2021. The increase in operating costs was mainly due
to higher sales and distribution costs as well as higher administrative costs during both the first half
of the year and the third quarter. M&A-related effects from the recent acquisition of Synergia Life
Sciences had a minor impact on all three operating cost lines. In addition, the increase in sales and
distribution costs was due to higher logistics costs and continued investments in commercial activities.
As in the first nine months of the year, the third quarter increase in operating costs was mainly driven
by higher sales and distribution costs as well as higher administrative costs. Total operating costs in
the first nine months as a percentage of sales was roughly 30%, a decrease by 1 percentage point
compared to the same period last year. In the third quarter, total operating costs was also around
30%, an increase of 1 percentage point compared to the same period last year. Year-on-year currency
developments added to the higher operating costs in both the first nine months of the year and the
third quarter.
• Sales and distribution costs increased by 29% to make up 13% of sales during the first nine
months of the year and increased by 26% to make up 13% of sales in the third quarter.
• Research and development costs decreased by 2% to make up 11% of sales in the first nine
months of the year and increased by 9% to make up 11% of sales in the third quarter.
• Administrative costs increased by 19% to make up 5% of sales in the first nine months of the
year and increased by 26% to make up 6% of sales in the third quarter.
Other operating income amounted to DKK 271 million in the first nine months and DKK 240 million in
the third quarter of 2022. This was an increase of DKK 121 million and DKK 230 million higher than in
the corresponding period of 2021 and was due to the expected non-cash accounting gain related to
the 21
st
.BIO intellectual property investment in the third quarter of 2022.
Depreciation and amortization amounted to DKK 1,115 million in the first nine months of 2022,
corresponding to an increase of DKK 44 million compared to the same period of 2021. In the third
quarter, depreciation and amortization amounted to DKK 377 million, which was DKK 24 million higher
compared to the same period of 2021.
EBIT was DKK 3,539 million in the first nine months and DKK 1,287 million in the third quarter of 2022,
corresponding to an EBIT margin of 27.2% and 29.5%, respectively. This was an increase of DKK 337
million and a decrease of 1.6 percentage points for the first nine months of the year and an increase
of DKK 192 million or 0.4 percentage points for the third quarter compared to the EBIT and the EBIT
margins for the corresponding periods of 2021. The decrease in the EBIT margin for the first nine
months of the year was mainly a result of a reduced gross margin. The positive impact from the
Total costs
DKK 9,756 million
Gross margin
54.9%
Operating costs
DKK 3,886 million
Depreciation and amortization
DKK 1,115 million
EBIT
DKK 3,539 million
EBIT margin
27.2%
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
7/26
accounting gain from the 21
st
.BIO investment recognized under other operating income contributed
by around 1.5 percentage points to the EBIT margin after the first nine months. M&A had a roughly
neutral impact and currencies provided a tailwind.
Adjusting for the one-off effects in the first half year and the non-cash gain from the 21
st
.BIO
investment in the third quarter, the underlying EBIT margin was around 26%, which is approximately
2 percentage points below the underlying EBIT margin for same period last year, explained
predominantly by a lower gross margin.
The third quarter EBIT margin increased compared to last year benefitting from the contribution of
the 21
st
.BIO accounting gain, as well as a tailwind from currencies. Adjusting for the third quarter non-
recurring items, the EBIT margin was around 25%, which is lower than the underlying EBIT margin for
the third quarter of last year due to the lower gross margin impacted by increased input, energy and
logistics costs, as well as a negative mix effect and a higher operating cost-to-sales ratio.
Net financials including the share of losses in associates amounted to negative DKK 28 million in the
first nine months of the year and positive DKK 101 million in the third quarter of 2022. This equals an
improvement of DKK 21 million in the first nine months and DKK 142 million in the third quarter
compared to the corresponding periods of 2021, and includes the previously announced divestment
of Novozymes’ minority ownership in Albumedix.
Profit before tax amounted to DKK 3,511 million in the first nine months and DKK 1,388 million in the
third quarter of 2022. This was DKK 358 million (11%) and DKK 334 million (32%) higher, respectively,
than in the corresponding periods of 2021. For both periods, the increases were driven by higher EBIT,
additionally benefitting from the divestment-gain related to Albumedix.
The effective tax rate was 20% for the first nine months of the year and 17% for the third quarter of
2022. This was on par with the first nine months of last year and 3 percentage points lower than for
the third quarter of 2021. The lower tax rate in the third quarter can be explained by the two non-
recurring gains.
Net profit totaled DKK 2,809 million in the first nine months and DKK 1,153 million in the third quarter
of 2022. This was DKK 287 million (11%) higher and DKK 310 million (37%) higher than in the respective
corresponding periods of 2021. The higher net profit was due to an increase in EBIT, a positive one-
off financial gain and a decrease in the effective tax rate in the third quarter.
Net financial and share of
losses in associates
DKK 28 million
Effective tax rate
20%
Net profit
DKK 2,809 million
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
8/26
Cash flows and balance sheet
Cash flow from operating activities amounted to DKK 3,442 million in the first nine months and DKK
1,220 million in the third quarter of 2022 for increases of DKK 55 million and DKK 110 million
respectively compared to the corresponding periods of 2021. The developments of the nine-month
period were mainly due to a higher net profit and a positive contribution from working capital, which
were somewhat offset by reversals of non-cash items. The third-quarter increase was driven by higher
net profit, which was partly offset by the reversal of non-cash items.
Net investments excluding acquisitions totaled DKK 1,964 million in the first nine months and DKK
731 million in the third quarter of 2022. This was DKK 1,326 million and DKK 504 million higher
respectively than in the corresponding periods of 2021. In both the nine-month period and the third
quarter, the increase was mainly due to investments in the new production line for Advanced Protein
Solutions in Blair, Nebraska, U.S.
Free cash flow before acquisitions was DKK 1,458 million in the first nine months and DKK 489 million
in the third quarter of 2022. The respective declines of DKK 1,271 million and DKK 394 million relative
to the corresponding periods of 2021 were mainly due to an increase in net investments.
Total equity was DKK 14,043 million at September 30, 2022, corresponding to an equity ratio of 50.2%.
This was an increase of DKK 2,465 million and an increase of 21 percentage points respectively
compared to the total equity of DKK 11,578 million and the 53% equity ratio reported at September
30, 2021.
Net interest-bearing debt (NIBD) and the NIBD-to-EBITDA ratio were DKK 5,529 million and 1.0x
respectively at September 30, 2022 and in line with Novozymes’ capital structure target. This was an
increase of DKK 822 million in NIBD and an increase of 0.1x in the NIBD-to-EBITDA ratio compared to
September 30, 2021. The cash flow was positively impacted by developments in the cashflow from
operating activities and adversely impacted by the cash outflows relating to the increased CAPEX and
M&A activities.
Return on invested capital (ROIC) including goodwill was 17.8% in the first nine months of 2022. This
was 2.8 percentage points lower than in the corresponding period of 2021 mainly due to the increase
in invested capital, including acquisitions and growth investments.
The holding of treasury stock was at September 30, 2022 was 4,623,768 B shares, which was
equivalent to 1.6% of the common stock.
Operating cash flow
DKK 3,442 million
Net investments excluding
acquisitions
DKK 1,964 million
Free cash flow before
acquisitions
DKK 1,458 million
Equity ratio
50.2%
NIBD/EBITDA
1.0x
ROIC incl. goodwill
17.8%
Treasury stock
1.6%
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
9/26
Sales Outlook
Novozymes’ well-diversified business maintained its overall strong momentum in the third quarter as
organic sales grew by 6% y/y, and 9% compared to the first nine months of 2021. Sales growth in the
third quarter was particularly strong and exceeded expectations in Bioenergy and Grain & Tech
Processing. While the third quarter organic sales growth was relatively soft in both Food, Beverages &
Human Health and in Agriculture, Animal Health & Nutrition, it was mainly due to the timing of sales
between the third and the fourth quarters.
Based on the strong nine-month performance and strong start to the fourth quarter, Novozymes
confirms the full-year organic sales growth outlook of 8-9%. This includes the previously mentioned
negative full-year impact of around 1 percentage point from the war in Ukraine, mainly impacting
Household Care. Novozymes is experiencing good momentum and demand across a large part of its
portfolio focusing on innovation and market penetration combined with supportive market conditions.
The areas where yield and throughput are more relevant are benefitting relatively more from the
current market conditions. Sales in DKK are expected to be around 9% higher than the organic sales
growth outlook.
Sales prices were roughly neutral in the first quarter and slightly positive in the second and third
quarters. The good momentum with regards to pricing efforts and dialogues in collaboration with
customers across business areas and regions continues, and prices are expected to have an even
stronger impact in the fourth quarter, leading to a positive impact for the full year. Novozymes has
increased its efforts to structurally improve Novozymes’ commercial dynamics, including pricing, which
is progressing very well with more than two thirds of the price increases for 2023 already committed,
giving comfort to the 25%+ EBIT margin assumption for any individual year during the strategy period
until 2025, where the EBIT margin is expected at 26% or higher.
Household Care (organic 0% in 9M 2022) organic sales in 2022 are indicated to be ‘flat to 2%’,
including a negative impact from the war in Ukraine. Growth will be driven by enzymatic penetration
in emerging markets, primarily within the laundry category, and include an assumed overall very good
growth performance in the fourth quarter. The performance in the European detergent/laundry
market is based on an expectation of slightly contracting market volumes, whereas the emerging
markets are expected to grow despite the negative impact from the war in Ukraine. The Freshness
technology is expected to contribute positively to performance in both emerging and developed
markets.
Food, Beverages & Human Health (organic 8% in 9M 2022) organic sales growth is maintained in the
‘low teens’ and is expected to be broad-based across Food, Human Health and Beverages. Fourth-
quarter growth is expected to be strong which is confirmed by the start to the quarter. Growth in Food
is expected to be driven primarily by innovation and health-focused solutions. Growth is also expected
to benefit from raw material optimization and ingredient substitutions, including strong performance
in baking and growth in solutions for plant-based protein. Beverages is expected to grow, mainly driven
by increased market penetration, and supported by customers focused on yield, throughput, and
quality. Human Health is expected to grow organically in the solid double-digits, driven by cross-selling
in regions and channels, and with a growth acceleration in the fourth quarter.
Bioenergy (organic 26% in 9M 2022) following the strong performance for the first nine months of the
year, including for the third quarter, the full-year organic growth indication for Bioenergy is raised from
‘mid teens’ to ‘high teens’. Organic sales growth is driven by innovation and supported by increased
U.S. ethanol production, capacity expansion of corn-based ethanol production in Latin America, and
market penetration with enzymatic solutions for biodiesel production. Additionally, as experienced in
the third quarter, sales of enzymes for 2G ethanol production supports the full-year performance. The
full-year indication also reflects a more difficult comparator in the last quarter of the year and is based
on the assumption that U.S. ethanol production in 2022 will increase by 3-4% compared to the previous
year.
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
10/26
Grain & Tech Processing (organic 11% in 9M 2022) organic sales growth is expected to be broad-based
with growth in both Grain and Tech Processing. Performance in Grain is expected to be led by strong
end-market demand in starch and vegetable oil processing, as well as by innovation. Growth in Tech
Processing is expected to be mainly driven by sales of enzymes used for COVID-19 testing kits.
Following a strong performance in the nine-month period, the full-year organic growth indication for
Grain & Tech Processing is raised to ‘around 10%’.
Agriculture, Animal Health & Nutrition (organic 7% in 9M 2022) organic sales growth will be led by
strong growth in Animal Health & Nutrition complemented by solid growth in Agriculture. Innovation
and a more diversified commercial model are key enablers for increased market penetration for
agriculture's bio-yield and bio-control solutions. Growth in Animal Health & Nutrition will primarily be
driven by innovation as well as end-market-driven volume growth. Agriculture is expected to grow
strongly in the fourth quarter after declining in the third quarter due to timing of orders between the
quarters. The full-year organic growth indication for Agriculture, Animal Health & Nutrition is
maintained at ‘high-single digits to low teens’.
Financial outlook
For 2022, Novozymes expects a solid EBIT margin of 26% to 27% (2021: 26.8%), including the non-
cash accounting gain related to the 21
st
.BIO agreement of roughly DKK 200 million recognized in the
third quarter. Compared to 2021, the EBIT margin will benefit from sales growth and productivity
improvements, targeted price increases, as well as a net positive currency effect. Higher input, energy
and logistics costs and continued investments in the business are expected to have a negative year-
on-year impact. The impact on the cost of goods sold is partially offset by productivity improvements,
operational leverage and a growing impact from price increases, increasingly so in the fourth quarter,
which also includes the expectation of an improved product mix. For the full year, the gross margin is
expected to be around 250bps lower y/y.
Return on invested capital (ROIC), including goodwill, is expected at 17% to 18% (2021: 19.3%).
including the non-cash accounting gain related to the 21
st
.BIO agreement recognized in the third
quarter. A higher NOPAT, including the accounting gain relating to 21
st
.BIO, and higher invested
capital, mainly from acquisitions, are the main drivers of the expected year-on-year development in
ROIC, including goodwill.
Free cash flow (FCF) before acquisitions is now expected at between DKK 1.3 to 1.7 billion (2021: DKK
2.9 billion). This is explained by higher net investments of DKK 400m relative to the previous
expectation and due to phasing between 2022/2023, as the construction of the Advanced Protein
Solutions production line in Blair is progressing very well within the maintained timeline and
investment level of DKK ~2bn.
For modeling purposes, the following is provided:
The effective tax rate is expected at around 20% for 2022 (2021: 20%) following the 21
st
.BIO agreement
and divestment of the minority ownership in Albumedix, which are both tax-exempt.
Net financial costs are expected to be around DKK 250 million (2021: DKK 83 million) as a result of
increased hedging costs, primarily related to USD forward contracts, and benefitting from the
divestment of the minority-ownership in Albumedix in the third quarter.
Net investments in 2022 are expected at between DKK 3.0 to 3.3 billion (2021: DKK 1.1 billion). This
reflects maintenance, optimization and expansion investments, including in new Food and health-
related customer co-creation centers, as well as roughly DKK 1.4 billion related to the investment in a
new state-of-the-art production line for Advanced Protein Solutions at Blair, Nebraska, with the total
investment for the project expected at around DKK 2 billion.
EBIT margin
26% to 27%
ROIC, incl. goodwill
17% to 18%
FCF before acquisitions
DKK 1.3 to 1.7 billion
Effective tax rate
~20%
Net financial costs
DKK ~250 million
Net investments
DKK 3.0 to 3.3 billion
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
11/26
The stock buyback program of up to DKK 500 million was initiated effective February 21, 2022 and
completed on June 27, 2022.
2022 outlook
November 3
October 7
August 11
April 26
February 1
Sales performance, organic
%
8-9
8-9
6-8
4-8
3-7
EBIT margin
%
26-27
26-27
26-27
25-26
25-26
ROIC, incl goodwill
%
17-18
17-18
17-18
16-17
16-17
FCF, before acquisitions
DKKbn
1.3-1.7
1.7-2.1
1.7-2.1
1.7-2.1
1.7-2.1
For modeling purposes
Effective tax rate
%
~20
~20
~20
~22
~22
Net financial costs
DKKm
~250
~200
200
350
250
Net investments
DKKbn
3.0-3.3
2.6-2.9
2.6-2.9
2.6-2.9
2.5-2.8
Sustainability outlook
With our refreshed strategy, ‘Unlocking growth – powered by biotech’, we introduced a new set of long-
term commitments to a healthy planet. The commitments will help the shift accelerate towards a
climate-neutral society, transform food systems, and enable healthier lives. We also recognize the
urgent need for action and are raising our commitment to climate change to include all emissions from
our supply chain as well, and we will now strive for a 50% reduction in absolute emissions from
operations & supply chain across scopes 1, 2 and 3 by 2030. This is in line with the climate guidance
from the Science Based Targets initiative defined in 2021. We are also committed to continue ensuring
that our employees develop in a thriving, diverse and inclusive community. For the post-2022 period,
we will communicate new non-financial targets and milestones to further guide our journey towards
our long-term commitments. You can find more information about our long-term commitments in our
2021 Annual Report.
In 2022, we will continue to work towards our long-term commitments by investing in the development
of solutions that contribute to a healthy planet, improve our climate, water and waste footprints as
well as promoting an inclusive and diverse workplace where employees can stay safe, thrive and grow.
We will develop our roadmap further towards net zero emissions by 2050 and implement employee
programs focused on inclusion. Furthermore, we will continue to work together with our partners to
drive the global sustainability agenda, such as the U.N. Global Compact, World Wide Fund for Nature,
World Economic Forum, The B-team and the Science-Based Targets initiative.
Milestones
2022 Targets
Status
Zymers &
Society
Nurture diversity
1
86
On track
Occupational injury
2
≤1.5
On track
Zymer spirit index score
3
81
On track
Enable learning
3
80
On track
Pledge our time to local outreach activities
1% of time
4
On track
Operations
Reduce absolute CO
2
emissions from operations
5
40%
On track
Develop context-based water management programs
100% of sites
6
On track
Manage biomass in circular systems
100%
On track
Develop circular management plans for key packaging materials
100%
On track
Develop programs to reach zero waste by 2030
100% of sites
6
On track
World
Save CO
2
emissions by enabling low-carbon fuels in the transport
sector
60 million tonnes of CO
2
On track
Reach people by providing laundry solutions that replace
chemicals
>4 billion people
On track
Gain food by improving efficiency from farm to table
500,000 tonnes of food
More to do
1
Index calculated based on gender and national representation at various professional levels.
2
Defined as the three-year rolling average of lost time injuries per million working hours.
3
Measured by score to relevant questions in annual survey.
4
Qualitative reporting only.
5
From a 2018 baseline.
6
The targets do not include sites with activities not considered to have a significant environmental impact, e.g. sales offices, R&D labs, etc.
Stock buyback program
DKK 500 million completed
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
12/26
Currency exposure
Sales by currency, 9M 2022
Other things equal, a 5% movement in USD/DKK is expected to have an annual positive/negative
impact on EBIT of around DKK 130-160 million, and a 5% movement in EUR/DKK is expected to have
an annual positive/negative impact on EBIT of DKK ~200 million.
Hedging of net currency exposure and currency exchange rates
The currency exposure is hedged 100% at an average exchange rate of USD/DKK 6.30 in 2022.
The 2022 outlook is based on exchange rates for the company’s key currencies remaining at the closing
rates on November 2 for the rest of the year.
DKK
EUR
USD
BRL
CNY
Average exchange rate, 9M 2022
744
701
137
106
Average exchange rate, 9M 2021
744
622
117
96
Average exchange rate,
9M 2022 compared to 9M 2021
0%
13%
17%
10%
Estimated average exchange rate 2022*
744
714
139
106
Estimated average exchange rate 2022
compared to 2021
0%
14%
19%
8%
*On November 2, 2022.
~34%
~37%
~8%
~6%
~15%
EUR
USD
CNY
DKK
Others
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
13/26
Accounting policies
The interim report for the first nine months of 2022 has been prepared in accordance with IAS 34 and
additional Danish regulations for the presentation of quarterly interim reports by listed companies.
The accounting policies applied in the interim report for the first nine months of 2022 are consistent
with those applied in the annual report for 2021, except for all new, amended or revised accounting
standards and interpretations (IFRSs) endorsed by the EU effective for the accounting period
beginning on January 1, 2022. These IFRSs have not had any impact on the Group’s interim report.
Forward-looking statements
This company announcement and its related comments contain forward-looking statements, including
statements about future events, future financial performance, plans, strategies and expectations.
Forward-looking statements are associated with words such as, but not limited to, "believe,"
"anticipate," "expect," "estimate," "intend," "plan," "project," "could," "may," "might" and other words
of similar meaning. Forward-looking statements are by their very nature associated with risks and
uncertainties that may cause actual results to differ materially from expectations, both positively and
negatively. The risks and uncertainties may, among other things, include unexpected developments in
i) the ability to develop and market new products; ii) the demand for Novozymes' products, market-
driven price decreases, industry consolidation, and launches of competing products or disruptive
technologies in Novozymes' core business areas; iii) the ability to protect and enforce the company's
intellectual property rights; iv) significant litigation or breaches of contract; v) the materialization of
the company's market-expanding growth platforms, notably the development of microbial solutions
for broad-acre crops; vi) political conditions, such as acceptance of enzymes produced by genetically
modified organisms; vii) global economic and capital market conditions, including, but not limited to,
currency exchange rates (USD/DKK and EUR/DKK in particular, but not exclusively), interest rates and
inflation; viii) significant price decreases for inputs and materials that compete with Novozymes'
biological solutions. The company undertakes no obligation to update any forward-looking statements
as a result of future developments or new information.
Contact information
Investor Relations
Tobias Bjorklund (U.S.)
+45 3077 8682
tobb@novozymes.com
Ludmila Cebanov
ldnv@novozymes.com
Media Relations
Lina Danstrup
+45 3077 0552
lind@novozymes.com
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
14/26
Statement of the Board of Directors and the Executive
Management
Bagsvaerd, November 3, 2022
EXECUTIVE MANAGEMENT
Ester Baiget
President & CEO
Lars Green
CFO
BOARD OF DIRECTORS
Jørgen Buhl Rasmussen
Chair
Cornelis (Cees) de Jong
Vice Chair
Anne Breum
Heine Dalsgaard
Sharon James
Anders Hentze Knudsen
Kasim Kutay
Preben Nielsen
Morten Alexander Sommer
Kim Stratton
Jens Øbro
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
15/26
Appendices
Appendix 1 Main items and key figures 16
Key figures 16
Income statement 17
Statement of comprehensive income 18
Appendix 2 Distribution of sales 19
Business areas 19
Geography 20
Appendix 3 Statement of cash flows 21
Statement of cash flows 21
Appendix 4 Balance sheet and Statement of equity 22
Balance sheet, Assets 22
Balance sheet, Liabilities 23
Statement of equity 24
Appendix 5 Miscellaneous 25
Publicly announced product launches in 2022 25
Company announcements made in the 2022 financial year 26
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
16/26
Appendix 1 Main items and key figures
Key figures
DKK million 9M 2022 9M 2021 % change Q3 2022 Q3 2021 % change
Revenue 13,024 11,117 17% 4,367 3,761 16%
Gross profit 7,154 6,474 11% 2,348 2,177 8%
Gross margin 54.9% 58.2% 53.8% 57.9%
EBITDA 4,654 4,273 9% 1,664 1,448 15%
EBITDA margin 35.7% 38.4% 38.1% 38.5%
Operating profit / EBIT 3,539 3,202 11% 1,287 1,095 18%
EBIT margin 27.2% 28.8% 29.5% 29.1%
Share of result in associates (4) (2) (1) -
Net financials (24) (47) 102 (41)
Profit before tax 3,511 3,153 11% 1,388 1,054 32%
Tax (702) (631) 11% (235) (211) 11%
Net profit 2,809 2,522 11% 1,153 843 37%
Earnings per DKK 2 share 10.09 9.06 11% 4.17 3.04 37%
Earnings per DKK 2 share (diluted) 10.01 8.99 11% 4.14 3.01 38%
Net investments excl. acq. 1,964 638 208% 731 227 222%
Free cash flow before net acq. and
purchase of financial assets
1,458 2,729 (47)% 489 883 (45)%
Return on invested capital (ROIC)
incl. goodwill
17.8% 20.6%
Net interest-bearing debt 5,529 4,707
Equity ratio 50.2% 53.0%
Return on equity 27.1% 28.4%
Debt-to-equity 39.4% 40.7%
NIBD / EBITDA 1.0 0.9
Number of employees 6,741 6,369
Novozymes' stock
Sep. 30,
2022
Sep. 30,
2021
Common stock (million)
281.0 282.0
Net worth per share (DKK)
48.60 41.01
Denomination of share (DKK)
2.00 2.00
Nominal value of common stock
(DKK million)
562.0 564.0
Treasury stock (million)
4.6 5.1
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
17/26
Income statement
DKK million 9M 2022 9M 2021 Q3 2022 Q3 2021
Revenue 13,024 11,117 4,367 3,761
Cost of goods sold (5,870 ) (4,643 ) (2,019) (1,584)
Gross profit 7,154 6,474 2,348 2,177
Sales and distribution costs (1,710 ) (1,327 ) (573) (456)
Research and development costs (1,466 ) (1,497 ) (475) (435)
Administrative costs (710 ) (598 ) (253) (201)
Other operating income, net 271 150 240 10
Operating profit / EBIT 3,539 3,202 1,287 1,095
Share of result in associates (4 ) (2 ) (1) -
Net financials (24 ) (47 ) 102 (41)
Profit before tax 3,511 3,153 1,388 1,054
Tax (702 ) (631 ) (235) (211)
Net profit 2,809 2,522 1,153 843
Attributable to
Shareholders in Novozymes A/S 2,793 2,521 1,152 842
Non-controlling interests 16 1 1 1
Specification of net financials
Foreign exchange gain/(loss), net (221 ) 50 (93) (11)
Interest income/(costs) (31 ) (31 ) (10) (9)
Other financial items 228 (66 ) 205 (21)
Net financials (24 ) (47 ) 102 (41)
Earnings per DKK 2 share 10.09 9.06 4.17 3.04
Average no. of A/B shares outstanding (million) 276.7 278.2 276.3 277.1
Earnings per DKK 2 share (diluted) 10.01 8.99 4.14 3.01
Average no. of A/B shares, diluted (million) 279.0 280.4 278.4 279.8
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
18/26
Statement of comprehensive income
DKK million 9M 2022 9M 2021 Q3 2022 Q3 2021
Net profit
Currency translation of subsidiaries and non-controlling interests
Currency translation adjustments
Fair value adjustments
(292 ) (136 ) (135) (57)
Tax on fair value adjustments
Cash flow hedges reclassified to financial costs 191 (63 ) 82 7
Tax on reclassified fair value adjustments
(42 ) 14 (18) (1)
Cash flow hedges
(79 ) (155 ) (42) (39)
Other comprehensive income
Comprehensive income
Attributable to
Shareholders in Novozymes A/S 3,919 2,863 1,612 1,006
Non-controlling interests 17 2 1 1
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
19/26
Appendix 2 Distribution of sales
Business areas
2022
2021 % change % currency % M&A % organic
DKK million 9M 9M impact impact growth
Consumer Biosolutions
Household Care 3,758 3,613 4 4 0 0
Food, Beverages & Human Health 3,083 2,613 18 6 4 8
Agriculture & Industrial Biosolutions
Bioenergy
2,688 1,914 40 14 0 26
Grain & Tech Processing
1,973 1,657 19 8 0 11
Agriculture, Animal Health & Nutrition
1,522 1,320 15 8 0 7
Sales 13,024 11,117 17 7 1 9
2022
2021 % change % currency % M&A % organic
DKK million Q3 Q3 impact impact growth
Consumer Biosolutions
Household Care
1,300 1,247 4 5 0 (1)
Food, Beverages & Human Health
980 870 13 8 3 2
Agriculture & Industrial Biosolutions
Bioenergy
1,017 675 51 19 0 32
Grain & Tech Processing
626 539 16 9 0 7
Agriculture, Animal Health & Nutrition
444 430 3 10 0 (7)
Sales 4,367 3,761 16 9 1 6
% chang e
DKK million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q3/Q3
Consumer Biosolutions
Household Care
1,300 1,228 1,230 1,150 1,247 1,125 1,241 4
Food, Beverages & Human Health
980 1,004 1,099 851 870 878 865 13
Agriculture & Industrial Biosolutions
Bioenergy
1,017 874 797 788 675 651 588 51
Grain & Tech Processing
626 679 668 579 539 529 589 16
Agriculture, Animal Health & Nutrition
444 501 577 466 430 397 493 3
Sales 4,367 4,286 4,371 3,834 3,761 3,580 3,776 16
2021
2022
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
20/26
Geography
2022
2021
% change % currency % M&A % organic
DKK million 9M 9M impact impact growth
Europe, Middle East & Africa 4,591 4,309 7 2 0 5
North America 4,246 3,373 26 13 1 12
Asia Pacific 2,650 2,247 18 8 2 8
Latin America 1,537 1,188 29 13 1 15
Sales 13,024 11,117 17 7 1 9
Developed markets 8,230 7,017 17 6 1 10
Emerging markets 4,794 4,100 17 9 1 7
Sales 13,024 11,117 17 7 1 9
2022
2021 % change % currency % M&A % organic
DKK million Q3 Q3 impact impact growth
Europe, Middle East & Africa 1,489 1,443 3 2 0 1
North America 1,465 1,131 30 18 0 12
Asia Pacific 843 728 16 9 2 5
Latin America 570 459 24 15 1 8
Sales 4,367 3,761 16 9 1 6
Developed markets 2,748 2,311 19 10 0 9
Emerging markets 1,619 1,450 12 10 1 1
Sales 4,367 3,761 16 9 1 6
% chang e
DKK million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q3/Q3
Europe, Middle E ast & Africa 1,489 1,469 1,633 1,372 1,443 1,409 1,457 3
North America 1,465 1,395 1,386 1,310 1,131 1,076 1,166 30
Asia Pacific 843 913 894 762 728 733 786 16
Latin America 570 509 458 390 459 362 367 24
Sales 4,367 4,286 4,371 3,834 3,761 3,580 3,776 16
Developed markets 2,748 2,688 2,794 2,486 2,311 2,289 2,417 19
Emerging markets 1,619 1,598 1,577 1,348 1,450 1,291 1,359 12
Sales 4,367 4,286 4,371 3,834 3,761 3,580 3,776 16
2021
2022
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
21/26
Appendix 3 Statement of cash flows
Statement of cash flows
DKK million 9M 2022 9M 2021 Q3 2022 Q3 2021
Net profit
843
Reversals of non-cash items
328 690
Tax paid
(445 ) (285 ) (100) (65)
Interest received
Interest paid
(75 ) (39 ) (50) (14)
Cash flow before change in working capital
Change in working capital
(Increase)/decrease in receivables and contract assets
(172 ) (437 ) (51) (280)
(Increase)/decrease in inventories
(674 ) (445 ) (258) (148)
Increase/(decrease) in payables, deferred income and
contract liabilities
Currency translation adjustments
(2 ) (9 ) (2) (14)
Cash flow from operating activities
Investments
Purchase of intangible assets
(60 ) (107 ) (19) (34)
Sale of property, plant and equipment
Purchase of property, plant and equipment
(1,930 )
(534 ) (737) (194)
(1,964 )
(638 ) (731) (227)
489 883
Business acquisitions, divestments and purchase of financial
assets
Free cash flow
756 883
Financing
Borrowings
150 (4)
Repayment of borrowings
(1,366 ) (1,196 )
(520) (663)
Overdraft facilities, net
Repayment of lease liabilities
(89 ) (77 ) (31) (25)
Shareholders:
Purchase of treasury stock
- (368)
Sale of treasury stock
(1,500 )
18 58
Dividend paid
(1,525 ) (1,466 )
- -
Cash flow from financing activities
(1,273 ) (2,278 )
(414) (988)
Net cash flow
Unrealized gain/(loss) on currencies and financial assets,
included in cash and cash equivalents
Change in cash and cash equivalents, net
Cash and cash equivalents - Beginning of period
1.013 969
Cash and cash equivalents at September 30
1,377
863
Cash flow from investing activities before acquisitions,
divestments and purchase of financial assets
Free cash flow before acquisitions, divestments and
purchase of financial assets
(500 )
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
22/26
Appendix 4 Balance sheet and Statement of equity
Balance sheet, Assets
DKK million
Sep. 30,
2022
Sep. 30,
2021
Dec. 31,
2021
Completed IT development projects 204 173 200
Acquired patents, licenses and know-how
Goodwill
IT development projects in progress
Intangible assets 4,955 3,544 5,024
Land and buildings
Plant and machinery
Other equipment 1,036 1,038 1,039
Assets under construction and prepayments
Property, plant and equipment 11,962 9,755 10,185
Deferred tax assets 1,429 1,248 1,637
Other financial assets (non-interest-bearing) 48 29 30
Investment in associate 226 31 29
Other receivables
Non-current assets 18,654 14,637 16,944
Raw materials and consumables 574 398 433
Goods in progress 1,304 970 979
Finished goods
Inventories 3,757 2,860 2,992
Trade receivables 3,462 2,832 2,948
Contract assets 106 13 40
Tax receivables 132 88 286
Other receivables
Receivables 4,080 3,413 3,793
Other financial assets (non-interest-bearing) 107 41 75
Cash and cash equivalents 1,377 863 963
Assets held for sale
Current assets 9,321 7,189 7,823
Assets 27,975 21,826 24,767
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
23/26
Balance sheet, Liabilities
DKK million
Sep. 30,
2022
Sep. 30,
2021
Dec. 31,
2021
Common stock 562 564 564
Currency translation adjustments 1,197 (230 ) (8 )
Cash flow hedges (111 ) (28 ) (32 )
Retained earnings
Equity attributable to shareholders in Novozymes A/S
Non-controlling interests
Total equity 14,043 11,578 12,206
Share purchase liability 821 - 717
Deferred tax liabilities 1,326 944 1,337
Provisions 168 106 153
Contingent consideration 221 587 543
Deferred income 114 97 98
Other financial liabilities (interest-bearing) 3,710 3,712 3,676
Other financial liabilities (non-interest-bearing) - 12 4
Non-current lease liabilities
Non-current liabilities 6,688 5,835 6,888
Other financial liabilities (interest-bearing) 2,729 1,325 2,030
Other financial liabilities (non-interest-bearing) 279 92 109
Lease liabilities 139 156 122
Provisions 16 20 21
Contingent consideration 391 - -
Trade payables 1,816 1,162 1,490
Contract liabilities 120 138 129
Deferred income 23 33 34
Tax payables 490 318 486
Other payables
Current liabilities 7,244 4,413 5,673
Liabilities 13,932 10,248 12,561
Liabilities and equity 27,975 21,826 24,767
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
24/26
Statement of equity
DKK million
Common
stock
Currency
translation
adjustments
Cash flow
hedges
Retained
earnings
Total
Non-
controlling
interests
Total
Equity at January 1, 2022
Net profit for the period
Other comprehensive income for the period
Total comprehensive income for the period
Purchase of treasury stock
(500 ) (500 ) (500 )
Sale of treasury stock
Write-down of common stock
(2 ) 2 - -
Dividend
(1,524 ) (1,524 ) (1 ) (1,525 )
Stock-based payment
Non-controlling interests and share purchase liability
(104 ) (104 ) (8 ) (112 )
Tax related to equity items
(163 ) (163 ) (163 )
Changes in equity
(2 ) 1,205 (79 ) 705 1,829 8 1,837
Equity at September 30, 2022
Equity at January 1, 2021
Net profit for the period
Other comprehensive income for the period
Total comprehensive income for the period
Purchase of treasury stock
(1,500 ) (1,500 ) (1,500 )
Sale of treasury stock
Write-down of common stock
(6 ) 6 - -
Dividend
(1,465 ) (1,465 ) (1 ) (1,466 )
Stock-based payment
Tax related to equity items
Changes in equity
(6 ) 497 (155 ) (3 ) 333 1 334
Equity at September 30, 2021
Attributable to shareholders in Novozymes A/S
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
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Appendix 5 Miscellaneous
Publicly announced product launches in 2022
We have launched the following products in 2022.
Product
Description
Sustainability benefit*
HiPhorius™
HiPhorius
TM
is a fourth generation phytase
resulting from the Feed Alliance with
DSM.
Phosphorus is essential for animal
metabolism but is often inaccessible to
swine and poultry in the most common
animal feedstocks. Farmers often add
inorganic phosphates, but this increases
feed costs and leads to environmental
pollution through phosphorous emissions.
A phytase is an enzyme that releases
natural-bound phosphorus from raw
materials in feed. This reduces the need
for inorganic phosphorus
supplementation. The primary benefit is
the saving of rare phosphorus resources
and lower phosphorous emissions to
water bodies and reduced algae growth.
Valena Pulse G
Valena Pulse G enables better inclusion of
pulse ingredients in bread and reduces
reliance on emulsifiers. Inclusion of pulses
in bread increases the protein and fiber
content of breads while reducing
carbohydrates and retaining texture and
appearance.
Inclusion of pulses in bread addresses
the plant-based food segment and may
potentially result in a reduction of
greenhouse gas emissions. Pulses
improve the soil’s ability to absorb
natural CO
2
emissions. Because pulses
can fix nitrogen, they also need less
fertilizer. Fixing nitrogen makes the soil
more fertile, which helps other plants
flourish. Furthermore, when pulses are
sourced locally, the need for
transportation of crops is also reduced.
Innova® Turbo
Innova® Turbo is a fast and high -yielding
advanced yeast solution that enables
ethanol producers to make more faster
and without any conversion trade-offs.
Innova® Turbo improves energy
efficiency due to shorter fermentation
times, reduced need for DGS drying and
higher ethanol yield. This in turn results
in a lower carbon intensity of the
ethanol. Also, reduced emissions of
acetaldehyde from the fermentation off-
gas may reduce potential photochemical
smog.
Innova® Apex
Innova® Apex is a robust yeast solution
that allows ethanol producers to
maneuver through process turns
confidently with sustained top
performance.
Due to the higher ethanol yield obtained
with Innova® Apex, the carbon intensity
of the ethanol is reduced.
Progress Crystal
Progress Crystal is a protease for the soap
bar segment with excellent enzyme
activity and stability, resulting in strong
washing performance even when the soap
bar is stored over long periods of time.
Progress Crystal enables the soap bar
producers to eliminate the stabilizers
that they would need with traditional
protease formulations to keep the
protease stable in the soap bar.
Foliar LCO
Torque® IF and Ratchet® are two new
LCO promoters for BioAg that improve
yields by stimulating the natural growth
process above and below the soil for corn
and other key broad-acres crops.
The ability to achieve higher yields with
unchanged agricultural inputs results in
several environmental benefits including
reduced GHG emissions per kg of crop
produced and reduced pressure on
natural habitats.
Prefur Odorelief
Short and long term effective natural cat
litter odor control. Easy spray application
with long shelf life and no impact on cat
litter physical appearance.
Potential benefits are related to reduced
content of perfume and frequency of
replacing cat litter.
Carezyme Essential
New solution to help reshape the softener
category, not only caring for consumers’
clothes but also the environment by
offering a greener solution and helping to
meet new consumer demands.
By maintaining and restoring the look
and feel of fabrics, consumers are
motivated to keep their clothing and
home textiles for longer. With an
extended lifetime, fewer textiles need to
be produced and disposed of to the
Interim report for 9M 2022
Company Announcement no. 27 November 3, 2022 Novozymes A/S CVR number: 10 00 71 27 Krogshoejvej 36 2880 Bagsvaerd Phone +45 4446 0000
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benefit of the environment. Additionally,
reformulation of the softener reduces the
use of chemicals
Fiberlife
500/Fiberlife 550
Solution for textile biopolishing improving
anti-pilling, fabric quality (no hairballs,
Clean and smoother surface, good
washability, improved gloss)
Through improving the look and feel of
fabrics, Fiberlife 500 contributes to
extending their lifetime. In consequence,
the demand for new textiles is lower and
less textiles require waste treatment. Both
these aspects lower the pressure on
environment.
* The sustainability benefits are based on quantitative and/or qualitative evaluations. Novozymes does not have quantifiable data or
documentation to verify the benefits of all product launches.
Company announcements made in the 2022 financial year
(Excluding Management's trading in the Novozymes stock, major shareholder announcements and stock buyback status)
February 1, 2022
Group financial statement for 2021
February 21, 2022
Initiation of stock buyback
March 16, 2022
Resolutions from Novozymes A/S’ Annual Shareholders' Meeting 2022
April 20, 2022
Reduction of share capital
April 26, 2022
Interim report for Q1 2022
June 29, 2022
Novozymes’ financial calendar 2023
August 11, 2022
Interim report for the first half of 2022
October 7, 2022
Company announcement