Novonesis H1 Sales Rise 5%; Agriculture Unit Falls 3%

Novonesis, formed in late 2024 through the $12 billion merger of Novozymes and Chr. Hansen, has booked €91 million in cost synergies so far. Baiget said the pace is slightly ahead of the internal plan. The company targets run-rate synergies of €180-200 million by the end of 2027.

Lehmann narrowed the effective tax rate guidance to 20-21 percent from 22-23 percent. He cited the transfer of some intellectual property into Denmark's low-tax innovation regime. The change could add €15-20 million to net income this year, he said.

Free cash flow was negative €32 million in the first half. Lehmann attributed the outflow to working capital tied to inventory builds for second-half sales. He said cash flow should turn positive in the second half when those inventories unwind. Net debt fell to €3.5 billion from €4.1 billion at the end of December. Leverage stood at 2.4 times EBITDA. Lehmann said the priority is reducing that toward 1.5-2 times before any capital return, and Novonesis has not announced a share buyback.

Analysts on the call pressed on the agriculture decline. Baiget said demand in Brazil and India has been slow, a timing issue rather than a structural loss. She pointed to two biological fungicides planned for second-half launches in both markets as support for a rebound. Thomas Lind Petersen of Nordea asked about further cost cuts. Lehmann said the current synergy target reflected the integration teams' best estimate. He said the company could add more if the top line disappointed.

The next quarterly report is due in November.