14 April 2021 - Providing an update yesterday of Evonik’s Nutrition & Care structural and efficiency improvements underway, division head Johann-Caspar Gammelin said that the company strives for a specialty portfolio, for more sustainable growth, precise KPIs, products with superior sustainability profiles, EBIDTA margins of above 22%, and a Return on Capital Employed (ROCE) above 14%.
“Anything that does not meet these expectations will be handled accordingly: Fix it, sell it, or close it,” he said.
Among the possibilities he outlined is a selective exit from bio-amino acids production (threonine and tryptophan) and more focus on higher value amino acids.
“We will further optimise our portfolio and focus on the specialty business”.
He explained that further optimisation of the animal nutrition portfolio will in part be realised by synergies and joint resources from the other two segments of the Nutrition & Care division (health care and care solutions). Synergies have already been found in microbiome modulation, biotech processes, and delivery systems. However, other expansion areas identified include biotech test systems, particle design, and digital platforms.
In terms of asset optimisation, Gammelin reminded his audience that for animal nutrition, Evonik has already optimised its global methionine network and regrouped production in three major hubs (Singapore, Antwerp and Mobile) after stopping production in Wesseling, Germany in October 2020. Meanwhile, the company’s Slovakia facility which used to be an animal nutrition site has been repurposed and is now a biotechnology scale-up and launch platform serving all businesses in Nutrition & Care.
Regarding methionine, Gammelin stressed that Evonik Nutrition & Care wants to maintain its cost leading position as the product remains a key part of the portfolio. “Methionine will continue to deliver a strong cash flow in the future. Methionine currently fulfils all our criteria within our portfolio management strategy, including margins and ROCE.”
Gammelin added that the company will only continue to invest in its methionine assets for three main reasons: maintenance, smart debottlenecking, or the necessity to improve its cost position.
