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Probiotic dairy products for children: An untapped market with global appeal

Chr. Hansen launches culture solution for kids’ drinking yogurt with the probiotic strain L. rhamnosus, LGG®

The market for children’s products is increasing rapidly with the trend towards smaller families, combined with higher disposable incomes, and parents are looking for foods that are healthy as well as tasty and convenient. At the same time, the awareness of probiotics – good bacteria – is increasing, as more and more scientific data on the correlation between digestive health and overall health is published, creating new opportunities for the innovative dairy producer.

Now Chr. Hansen presents ProKids, a concept solution for a tasty probiotic children’s drinking yogurt. It is Chr. Hansen’s newly developed freeze-dried DVS® culture, nu-trish® GY-1, which contains the LGG® probiotic strain together with a compatible yogurt culture, and a proven recipe that make up the backbone of the ProKids concept.

Chr.Hansen launches yogurt cultures for dairy alternatives

The market for fermented dairy alternatives has shown strong growth in recent years albeit from a small base. Today the segment constitutes less than 1% of the fermented foods market but it has seen the highest growth rates within the category in 2015 and 2016 (source: Euromonitor).

In August, Chr. Hansen commissioned a consumer survey to better understand usage of and attitudes toward dairy alternative products. The survey uncovered that

  • Dairy alternatives are seen as a supplement to the existing dairy-based products enabling more choice and dietary options
  • The modern consumer values variation and more than half of the consumers asked have purchased a dairy alternative food or beverage
  • among those, 77% want to see more options in the grocery store, indicating that dairy alternative products have a lot of room for growth

Chr. Hansen is launching a product range that is well-suited to tap into the opportunities this new market trend is offering: Two new YoFlex® (yogurt) cultures and two new nu-trish® (probiotic) cultures.

Chr.Hansen’s Q1-result positive

The revenue reached EUR 242 million, compared to EUR 214 million in Q1 2015/16, corresponding to organic growth of 11%. Divided to business area the results were:

  • Food Cultures & Enzymes 10% organic growth
  • Health & Nutrition 8% organic growth
  • Natural Colors 13% organic growth

The EBIT before special items was EUR 66 million, compared to EUR 54 million in Q1 2015/16. The EBIT margin before special items was 27.1%, compared to 25.2% in Q1 2015/16.

Chr. Hansen appoints new Executive Vice President and Chief Scientific Officer

Chr. Hansen Holding A/S has entered into an agreement with Thomas Schäfer to take up the position of Executive Vice President and Chief Scientific Officer.

Thomas is currently employed as Vice President at Novozymes and will take up his new position as soon as possible, expected during the spring of 2017.He will report to the CEO and become a member of the Executive Board.

Thomas will lead Chr. Hansen’s scientific organization for Food Cultures and Enzymes, and for Health and Nutrition (the R&D organization for the Microbial Solutions Platform). This organization consists of 210 employees, largely based at company headquarters in Denmark.

Chr. Hansen launches a new coagulant CHY-MAX® Special

Today, soft cheese producers are faced with two main challenges – namely the texture and flavor of the cheese that are likely to change significantly during shelf life. This undesired process occurs as proteins break down into peptide fractions, which ultimately can lead to an increased amount of bitterness, a runny texture or the unpleasant smell of ammonia.

CHY-MAX® Special is a patented coagulant that can put an end to these concerns. With its formula, producers and consumers are guaranteed a soft cheese with great texture and flavor throughout the entire shelf life. With its stable ripening profile, extended shelf life is made possible.

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Chr. Hansen’s organic growth of 12%

“2015/16 was overall a good year for Chr. Hansen. We reaffirmed the short- and long-term growth opportunities through our strategic review, and our financial performance was strong. Organic growth reached 12% and the EBIT margin before special items ended at 28.2%, up from 27.1% the year before. Finally, free cash flow before special items and acquisitions was EUR 175 million, an improvement of 16% despite our continued investments in future growth. So I can only be pleased with how we performed in 2015/16” says CEO Cees de Jong.

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Chr. Hansen acquires LGG from Valio

Chr. Hansen is supplier of probiotics to dietary supplements, infant formula and dairy, and through the acquisition of the LGG® business, the company is now further strengthening its microbial platform across all three categories.

Alongside Chr. Hansen’s own BB-12® strain, the Lactobacillus rhamnosus GG (protected under the trademark LGG®) is the best documented probiotic strain in the world. It has been used in food and dietary supplements since 1990 and has a proven beneficial effect on the gastrointestinal and immune system. It has been studied in more than 200 clinical studies and described in more than 800 scientific publications.

The price of the acquisition is EUR 73 million and will be funded through Chr. Hansen’s own cash position and existing credit facilities.

75 million euro loan to Chr. Hansen

The European Investment Bank (EIB) has provided a EUR 75m loan to Chr. Hansen for the company’s research into and development of innovative solutions in the food, nutritional, pharmaceutical and agricultural industries. The EIB financing will boost the company’s efforts to develop food products with a reduced amount of sugar, salt and fat, as well as an extended shelf life.

The EIB loan will also be earmarked for Chr. Hansen’s development of natural solutions improving the stability of probiotic cultures, protecting agricultural crops and exploring bacterial applications to human health. The global bioscience company will develop new products for its historical businesses covering dairy ingredients for cheese and fermented milk, cultures for meat and wine, as well as probiotics for human and animal health. At the same time, Chr. Hansen is also increasingly focusing on human health applications, in particular gastrointestinal health, immune health and women’s health.

The project will be carried out at Chr. Hansen’s main research and development centre located in Hørsholm (Denmark) and in Saint-Germain-lès-Arpajon (France). Over the project period until 2018, some 80 new research and development jobs are expected to be created.

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