Accounting policy
Business combinations
Business combinations are accounted for using the acquisition method from the moment control is transferred to the Group.
The cost of an acquisition is measured as the aggregate of the consideration transferred, including assets transferred, shares issued, and liabilities incurred, measured at acquisition date fair value. Acquisition-related costs incurred are expensed, except if related to the issue of debt or equity securities. As of the acquisition date, identifiable assets acquired, liabilities assumed, and any non-controlling interest in the acquiree are recognized separately from goodwill.
Identifiable assets acquired and the liabilities assumed are measured at acquisition date fair value. For each business combination, dsm-firmenich elects whether it measures the non-controlling interest in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net assets. Any contingent consideration payable is measured at fair value at the acquisition date; subsequent changes in the fair value of the contingent consideration resulting from events after the acquisition date are recognized in profit or loss.
For business combinations with the acquisition date in the prior reporting period, comparative information is revised in case adjustments are made during the measurement period to the provisional amounts, determined as part of the purchase price allocation (PPA), based on information available at the acquisition date.
Non-current assets and disposal groups held for sale
Non-current assets and disposal groups (assets and liabilities relating to an activity that is to be sold) are classified as ‘held for sale’ if their carrying amount is to be recovered principally through a sales transaction rather than through continuing use.
The reclassification takes place when the assets are available for immediate sale and the sale is highly probable. These conditions are usually met as from the date on which a letter of intent or agreement to sell is ready for signing. Non-current assets and disposal groups held for sale are measured at the lower of carrying amount and fair value less costs to sell. Non-current assets held for sale are not depreciated or amortized.
Discontinued operations
Discontinued operations comprise those activities that were disposed of during the period or which were classified as held for sale at the end of the period and represent, or is part of single co-ordinated plan to dispose of, a separate major line of business or geographical area that can be clearly distinguished for the purposes of operational and financial reporting. Classification as a discontinued operation occurs when the operation meets the criteria to be classified as held for sale.
The business results reclassified to discontinued operations include also intercompany recharges that cease to be earned/incurred on disposal. Corporate costs are excluded from the reclassification to discontinued operations.
The comparative numbers in the Income statement and the Statement of comprehensive income are re-presented as if the activities had been discontinued from the start of the comparative year.
Estimates and judgments
Key estimates dsm-firmenich makes in the accounting for changes in the scope of consolidation relate to the determination of fair values for assets acquired and liabilities assumed in business combinations. These estimates are based on historical quoted market prices and experience and are generally validated by external valuation specialists.
Acquisitions
In 2025, dsm-firmenich did not acquire any business (same as in 2024).
Divestments
Feed Enzymes
On June 2, 2025, dsm-firmenich completed the divestment of its interest in the Feed Enzymes Alliance to its partner Novonesis, a global leader in biosolutions, for a cash consideration of €1.5 billion. The Feed Enzymes business was part of the Animal Nutrition & Health Business Unit, and represented approximately €165 million sales in 2024, with approximately 100 employees who were transferred to Novonesis.
Other divestments
The other divestments that were completed in the reporting period include the Pentapharm business (BU P&B) and the Mechanical biomedical devices business (BU HNC).
Summary of divestments in 2025
See the table below for the book result of the divestments that took place in the reporting year.
|
|
Feed Enzymes |
|
Other divestments |
|
Total |
|---|---|---|---|---|---|---|
Assets |
|
|
|
|
|
|
Goodwill and intangible assets |
|
(1,086) |
|
– |
|
(1,086) |
Property, plant and equipment |
|
– |
|
(18) |
|
(18) |
Other non-current assets |
|
– |
|
3 |
|
3 |
Inventories |
|
(33) |
|
(22) |
|
(55) |
Receivables and other current assets |
|
52 |
|
(5) |
|
47 |
Cash and cash equivalents |
|
(30) |
|
(4) |
|
(34) |
Total assets |
|
(1,097) |
|
(46) |
|
(1,143) |
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Provisions |
|
– |
|
– |
|
– |
Non-current liabilities |
|
– |
|
– |
|
– |
Current liabilities |
|
17 |
|
(1) |
|
16 |
Total liabilities |
|
17 |
|
(1) |
|
16 |
|
|
|
|
|
|
|
Net assets |
|
(1,114) |
|
(45) |
|
(1,159) |
Non-controlling interest |
|
– |
|
– |
|
– |
Net assets dsm-firmenich shareholders |
|
(1,114) |
|
(45) |
|
(1,159) |
|
|
|
|
|
|
|
Consideration |
|
1,475 |
|
2 |
|
1,477 |
Selling costs |
|
(10) |
|
(2) |
|
(12) |
Book result |
|
351 |
|
(45) |
|
306 |
Release translation reserve, hedging reserve |
|
(60) |
|
(1) |
|
(61) |
Income tax |
|
– |
|
1 |
|
1 |
Net book result |
|
291 |
|
(45) |
|
246 |
|
|
|
|
|
|
|
Impact on the cash flow statement |
|
|
|
|
|
|
Consideration |
|
1,475 |
|
2 |
|
1,477 |
Of which deferred payments, non-cash and internal financing |
|
– |
|
(1) |
|
(1) |
Consideration in cash |
|
1,475 |
|
1 |
|
1,476 |
Cash in divested company |
|
(30) |
|
(4) |
|
(34) |
|
|
|
|
|
|
|
Selling costs |
|
(10) |
|
(2) |
|
(12) |
Other divestment-related cash-in/(out) |
|
(19) |
|
(141) |
|
(160) |
Total cash-in/(out) related to disposals |
|
1,416 |
|
(146) |
|
1,270 |
Income statement continuing and discontinued operations
Discontinued Operations captures the results of the combined businesses that were an integral part of the single co-ordinated plan to dispose these businesses following dsm-firmenich’s post-merger portfolio review, mainly including the ANH business subject to the carve-out and the completed divestments of the Feed Enzymes business, the Yeast Extracts business, and the Marine Lipids business. The assets and liabilities related to the ANH business subject to the carve-out were reclassified as assets held for sale at year-end following its planned divestment.
The operating loss in discontinued operations amounting to -€1,588 million comprises the full year operating profit of the regular activities of the discontinued businesses (€253 million), the book profit of the divested businesses in 2025 (€245 million), the impairment of the ANH business which is held for sale (-€1,922 million), and carve-out and divestment costs (-€164 million).
Impact of discontinued operations on the cash flow statement
The impact of the business that has been included as discontinued operations in the cash flow statement is shown in the table below.
|
|
2025 |
|
2024 |
||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
|
Continuing operations |
|
Discontinued operations |
|
Total |
|
Continuing operations |
|
Discontinued operations |
|
Total |
Net sales |
|
9,034 |
|
3,487 |
|
12,521 |
|
9,054 |
|
3,745 |
|
12,799 |
Adjusted EBITDA |
|
1,772 |
|
507 |
|
2,279 |
|
1,751 |
|
367 |
|
2,118 |
EBITDA |
|
1,657 |
|
588 |
|
2,245 |
|
1,572 |
|
419 |
|
1,991 |
Total expenses |
|
8,323 |
|
5,075 |
|
13,398 |
|
8,507 |
|
3,731 |
|
12,238 |
Adjusted operating profit (loss) |
|
861 |
|
253 |
|
1,114 |
|
816 |
|
110 |
|
926 |
Operating profit (loss) |
|
711 |
|
(1,588) |
|
(877) |
|
547 |
|
14 |
|
561 |
Financial income and expense |
|
(143) |
|
(10) |
|
(153) |
|
(124) |
|
(10) |
|
(134) |
Profit (loss) before income tax expense |
|
568 |
|
(1,598) |
|
(1,030) |
|
423 |
|
4 |
|
427 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
(118) |
|
216 |
|
98 |
|
(64) |
|
(83) |
|
(147) |
Results related to associates and joint ventures |
|
(108) |
|
1 |
|
(107) |
|
– |
|
– |
|
– |
Net profit (loss) for the year |
|
342 |
|
(1,381) |
|
(1,039) |
|
359 |
|
(79) |
|
280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Of which attributable to non-controlling interests |
|
2 |
|
40 |
|
42 |
|
11 |
|
19 |
|
30 |
Interest on hybrid bonds (equity) |
|
26 |
|
– |
|
26 |
|
28 |
|
– |
|
28 |
Available to holders of ordinary shares |
|
314 |
|
(1,421) |
|
(1,107) |
|
320 |
|
(98) |
|
222 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share (EPS) |
|
|
|
|
|
|
|
|
|
|
|
|
- Net basic EPS |
|
1.21 |
|
(5.48) |
|
(4.27) |
|
1.21 |
|
(0.37) |
|
0.84 |
|
|
2025 |
|
2024 |
|---|---|---|---|---|
Net cash provided by/(used in): |
|
|
|
|
- Operating activities |
|
376 |
|
336 |
- Investing activities |
|
1,112 |
|
(159) |
Total |
|
1,488 |
|
177 |
Investing activities in 2025 include the divestment of the Feed Enzymes business for €1,416 million. See also Note 26 Notes to the cash flow statement
Impact on comprehensive income
The impact of the businesses that have been presented as discontinued operations in the income statement and statement of comprehensive income are presented in the table below.
The comparative numbers in the Income statement and the Statement of comprehensive income are re-presented as if the activities of the combined businesses that were an integral part of the single co-ordinated plan to dispose these businesses had been discontinued from the start of the comparative year 2024.
See also the section Assets and liabilities held for sale.
|
|
2025 |
|
2024 |
|---|---|---|---|---|
Net profit from discontinued operations |
|
(1,381) |
|
(79) |
|
|
|
|
|
Other comprehensive income |
|
|
|
|
Remeasurements of defined benefit pension plans |
|
28 |
|
1 |
Related tax |
|
(4) |
|
(1) |
Items that will not be reclassified to profit or loss |
|
24 |
|
– |
|
|
|
|
|
Exchange differences on translation of foreign operations |
|
|
|
|
- Change for the year |
|
133 |
|
(112) |
Items that may subsequently be reclassified to profit or loss |
|
133 |
|
(112) |
Total comprehensive income discontinued operations |
|
(1,224) |
|
(191) |
|
|
|
|
|
Of which: |
|
|
|
|
- Attributable to non-controlling interests |
|
2 |
|
(4) |
- Available to equity holders of dsm-firmenich |
|
(1,226) |
|
(187) |
Assets and liabilities held for sale
At the end of 2025, the assets and liabilities relating to the remaining ANH business were reclassified to held for sale based on its highly probable sale within the next 12 months (no assets and liabilities were held for sale at the end of 2024). Following its classification to held for sale, the ANH business was measured at the lower of its carrying amount and fair value less cost to sell, resulting in an impairment of €1,922 million.
Impact assets and liabilities held for sale on the balance sheet
The impact of the reclassification of the regarding activities on the dsm-firmenich consolidated balance sheet is presented in the following table.
|
|
Transferred to |
|
Impairment |
|
Held for Sale |
|---|---|---|---|---|---|---|
Assets |
|
|
|
|
|
|
Goodwill and intangible assets |
|
940 |
|
(821) |
|
119 |
Property, plant and equipment |
|
1,521 |
|
(1,082) |
|
439 |
Deferred tax assets |
|
379 |
|
– |
|
379 |
Prepaid pension costs |
|
2 |
|
– |
|
2 |
Share in associates and joint ventures |
|
25 |
|
– |
|
25 |
Other non-current assets |
|
40 |
|
– |
|
40 |
Non-current assets |
|
2,907 |
|
(1,903) |
|
1,004 |
|
|
|
|
|
|
|
Inventories |
|
1,042 |
|
– |
|
1,042 |
Trade receivables |
|
630 |
|
– |
|
630 |
Income tax receivables |
|
20 |
|
– |
|
20 |
Other current receivables |
|
22 |
|
– |
|
22 |
Cash and cash equivalents |
|
11 |
|
– |
|
11 |
Current assets |
|
1,725 |
|
– |
|
1,725 |
Total assets Held for Sale |
|
4,632 |
|
(1,903) |
|
2,729 |
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
Deferred tax liabilities |
|
100 |
|
– |
|
100 |
Employee benefit liabilities |
|
209 |
|
– |
|
209 |
Provisions |
|
3 |
|
– |
|
3 |
Borrowings |
|
50 |
|
– |
|
50 |
Other non-current liabilities |
|
45 |
|
– |
|
45 |
Non-current liabilities |
|
407 |
|
– |
|
407 |
|
|
|
|
|
|
|
Employee benefit liabilities |
|
6 |
|
– |
|
6 |
Provisions |
|
61 |
|
– |
|
61 |
Borrowings |
|
1 |
|
– |
|
1 |
Trade payables |
|
720 |
|
– |
|
720 |
Income tax payables |
|
46 |
|
– |
|
46 |
Other current liabilities |
|
165 |
|
– |
|
165 |
Current liabilities |
|
999 |
|
– |
|
999 |
Total liabilities held for sale |
|
1,406 |
|
– |
|
1,406 |
Total held for sale |
|
3,226 |
|
(1,903) |
|
1,323 |
Divestment-related liabilities |
|
|
|
(19) |
|
|
Total impairment |
|
|
|
(1,922) |
|
|