Frankfurt, July 29 - Germany's Symrise , faced with rising raw material costs and a weak dollar, cut its growth outlook for operating profit this year after reporting quarterly results on Tuesday that met analysts' estimates. Second-quarter earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 1.6 percent to 71.4 million euros ($112 million), compared with the average forecast of 72 million euros in a Reuters poll of 10 analysts.
The world's fourth-largest flavours and fragrances maker raised its 2008 sales growth to 6-7 percent in local currencies from 5-6 percent previously, but cut its profit growth outlook.
Symrise said it now expected earnings before interest, taxes and amortisation (EBITA) to grow 6 percent in local currencies, down from its previous guidance of 10 percent.
Shares in Symrise were indicated 3.3 percent lower before the German market opens at 0700 GMT.
Symrise competes with Givaudan , International Flavors and Fragrances (IFF) and Firmenich in the 15-billion euro market to supply the food industry and designs perfumes for firms like Donna Karan and Givenchy .
In the second quarter, the core profit margin eased to 21.1 percent from 21.3 percent. The company said it now expected a core margin of around 21 percent, down from 22 percent earlier.
"With the weaker economic environment and the projected slowing in consumer spending in the remaining six months of the 2008 fiscal year, we do not anticipate any significant recovery in the fragrance market," the company said.
Symrise also said it expected the flavours and fragrances industry to grow about 2 percent this year, with a relatively stronger flavours market compared with the fragrance market.
It said rising costs in raw materials and energy were expected to affect its margins this year despite its attempts to pass on the higher costs to customers.
Symrise shares have fallen almost 40 percent since the start of the year, underperforming a 9 percent fall in the DJ Stoxx chemicals index <.SX4P>, partly on margin worries.