The Dutch bakery ingredients giant said that net sales from continuing operations increased from €2,392 million to €2,421 million, up 1.2 per cent.
Organic net sales growth was 2.3 per cent. The operating result from continuing operations before exceptional items amounted to €155.1 million, up 21 per cent.
CSM's so-called 3-S restructuring programme also led to cost savings amounting to €43 million in 2006, resulting in cumulative savings of €62 million. Restructuring costs totalled €24 million in 2006.
"2006 was a good year for CSM, both financially and operationally," said Gerard Hoetmer, CEO of CSM.
"Our sharpened strategy, developed with a view to turning CSM again into a cost-conscious, customer-oriented and innovative player, is up and running.
"It is quite an achievement of our people to make sales and profit grow organically in a period of major restructuring."
All the businesses at Bakery Supplies Europe for example took steps last year to improve organisational efficiency and effectiveness. The British and German organisations made what Hoetmer called "substantial changes to their overheads structure", while the Spanish and Portuguese activities have been merged.
In addition, factories have been shut down in, amongst other places, the UK and France.
"Meantime, we took our first steps in 2006 toward a centralised European organisation," said Hoetmer.
"In addition to a European procurement organisation we made a start on a European-led R&D organisation and on the preparations for the transition from a country-based organization to a European organisation.
"This transition will make heavy demands on a large group of motivated people in 2007."
In terms of prospects for 2007, Hoetmer predicted that 2007 would be "another year of substantial progress towards our strategic and financial goals."
"After the progress we have made in 2006, 2007 will again show a major step forward towards these goals," he said.
"Strategically very important are the transformation of BSEU (Bakery Supplies Europe) into one European organisation and the integration of the logistics activities within BSNA (Bakery Supplies North America)."
Hoetmer said that sales growth would be in line with 2006. The major investments in R&D and the organisational changes should start bearing fruit during 2007, although the impact on 2007 performance will be limited.
In addition, he said that the acquisitions of CGI Desserts, the speciality ingredients business of ADM, and Wilke Resources (acquired by
PURAC) should add €9 million in EBITA in 2007.
"Capital investments will outpace depreciation mainly due to the final investments for the Thai Purac factory," said the company in a statement.
"We expect working capital as a percentage of sales to improve slightly."
2007 will also be an important year for the further positioning of the group's European operations. Hoetmer said that sales in 2007 would show limited growth due to the focus on continued restructuring and the fact that the investments in innovation will only contribute substantially in 2008.
The rise in the prices of raw materials, part of which cannot be fully absorbed in the selling prices in the short term, may also have a limited negative effect on the margins.
On balance, the operating result excluding restructuring charges is expected to grow in line with CSM's targets for 2008 supported by the cost savings of the 3-S programme.
