Good morning. Thank you for joining today's call. I'm sitting here with Dimitri de Vreeze, our CEO, and Ralf Schmeitz, our CFO. We published this morning our trading update for the first quarter, which you can find on our website. Here you can also find our disclaimers about forward-looking statements. Following Dimitri's and Ralf's opening comments, we will open the line for questions as usual. Important to remind, also as usual, sell-side analysts who want to ask questions have to register via the questions link, which they can find on our website in the financial calendar. With that, Dimitri, you can start.
Thank you, Dave. I'm waiting. Thank you, Dave. Thank you for joining this call, and I will start with a few brief introductory remarks and then hand over to Ralf, who will talk you through. We will keep it short to allow plenty of time for questions. DSM-Firmenich has made a solid start for 2026 in its continuing business against a highly volatile macroeconomic backdrop. We delivered a 4% like-for-like sales growth, which was entirely volume driven, and this represent really good performance across the group, especially in Perfumery and Beauty. We've also announced today that we will have a dual listing of the shares on the SIX Swiss Exchange as of May 21st of this year. With a fully good start of the year, we have maintained our outlook for full year 2026.
Now, talking about the full year outlook 2026, if you go to the next slide, just as a reminder, the outlook is 2%-4% organic sales growth, about 20% EBITDA quality and an 11%-12% cash conversion. We've seen with a solid start of the year with a good quarter one and also a solid start into Q2. We feel that with that start, we feel confident in maintaining the outlook for the full year. With that, I hand over to Ralf for a little bit more color on the business performance.
All right. Thanks, Dimitri. If we move to the next slide, please. Good morning from my side as well to everyone. Good to see you virtually online again. As Dimitri said, we made a good start to the year. Overall, 4% volume growth across our portfolio, fully volume driven. On the slide, you'll see the full walk on sales, whereas we've had a solid start with a 4% organic growth.
The reported sales was impacted by an adverse impact from FX of about 6% and 1% from M&A, which reflects the sale of our Agro Ingredients business that we managed to complete in Q1 in line with our commitment, as well as the last step of the pruning actions as communicated in Capital Markets Day. Happy with that performance. We'll zoom in into the businesses in a minute. Overall, looking at a margin, we landed the quarter at a 19% margin for the quarter. Largely in line with expectation. We expect a gradual build up throughout the year. Keep in mind that the FX impact is about 0.4% on the margin, bringing it largely in line with last year.
We did experience some build-up of cost in terms of energy and logistics on the back of the Middle East, which we started to pass on to customers, but Q1 was impacted by a couple of million on the back of that, explaining the margin. As said, we'll expect a gradual improvement throughout the year. Let's then turn to the businesses on the next page, starting with Perfumery and Beauty. A very beauty start of the year. A strong performance with an 8% step up in volumes. A very strong performance in Fine Fragrance, with a strong double-digit growth. We've seen the build-up of momentum that we've seen building up in the second half of the year.
Growth continues in that space. We're capitalizing also on the wins that we see nicely coming through. Consumer Fragrance saw a high single-digit growth in the quarter. Here, we also see some acceleration of orders from our customers. It's always difficult to estimate. We think about an impact of up to 1% on overall group results, with a little higher in Perfumery and Beauty, concentrated in our Consumer Fragrance space. Ingredients performed in line with expectations and as guided for at Capital Markets Day. Overall, we expect a low single-digit growth, which is normalizing throughout the year. We've seen that in Q1 with a low single-digit growth in that space.
Worth noting here is that on the UV filter side, albeit at the low, low end, we're back to positive growth, which is something that we were anticipating as well, and it's good to see that that comes through in the first quarter too. Looking at the margin, overall margin came in at 22%, a little above average of last year. Largely in line with Q1. No big moving piece points on on this front. A nice step up in absolute, but obviously also here, we've seen a few million of costs coming through, which we started to pass on to our customers as well, and that will be neutralized fully in the second quarter.
Moving on to Taste, Texture and Health on the next page, please. Also here, a solid start of the year. Overall, a 3% volume growth in both our taste and ingredient business, in Taste, Texture and Health. Synergies continue to contribute positively as well. As usual, it almost becomes boring. We see a little over 1%, between 1%-2% contribution on that front. Overall, performing very nicely, and the pipeline continues to build well on that front. Now, you'll say, "Ralf, you're talking about a 3%. I see on the page only 2%." There is about a 1.91% from Bovaer that doesn't necessarily come evenly distributed throughout the year, so that's a bit chunky.
We now report it in Taste, Texture and Health. It had a negative impact of about 1% on top line and about 0.5% on the margin, but we expect that to be fully neutralized on the half. We'll see a good contribution in the second quarter. Overall margin, TTH, started a little lower in the year. We anticipated that on the back of FX. Adjusting for, if you look at it versus prior year and in line with the average of last year, margin is about 1.5% lower. As said, 0.5% is coming from Bovaer. 0.5% is coming from FX, and also here we've seen a few million of costs come through, which we're passing on to our customers.
For the second quarter onwards, we expect to be back at a 20% level in Taste, Texture and Health. Also here a encouraging start of the year. Last but not least, on the next page, please, Health, Nutrition and Care. Also here, good growth. 4% like-for-like growth in the year. Strongly driven by Early Life Nutrition. Good momentum in HMO. We've seen that build up following the approvals that we got, and that is nicely continuing into the year. Obviously, Q1 also saw a bit of tailwind from the ARA sales, where we're obviously working with our customers to help them as much as we can.
As indicated at Capital Markets Day, we expect a bit of tailwind throughout the year on the back of that. Also longer term, this will translate into a good contracting in that area. Overall, our U.S.-based businesses, Dietary Supplements, eye health, continue to see cautious behavior in that sense, so from a regional perspective to give you a bit of color on that. Translating that also to the margin development, a nice continued step up in margin. Overall, 19.3%. I do wanna call out the same as I did at Capital Markets Day. Here, the impact of the FX is the biggest. Overall, it negatively contributed around 0.7% on the margin.
Adjusting for that, we would be at the 20% and seeing in line with what we've seen throughout last year. On the other news on the quarter, no slides on that, but the guidance that we gave in Capital Markets Day around the housekeeping still stands. No surprises on that front in Q1, so that can continue for modeling for the rest of the year. With that, let me keep it short and leave time for Q&A. Dave, why don't we open the floor.
Yeah, I think that means that we can start with the Q&A. Maybe, again, as a reminder, sell-side analysts who want to ask questions in the Q&A session need to register via the questions link, which they can find on the website in the financial calendar. All other participants can listen into this Q&A session by staying in the Zoom meeting. With that, operator, we can start.
Ladies and gentlemen, we will now begin our Q&A session. If you have a question, we ask that you please use the raise hand function at the bottom of your Zoom screen. Once your name has been announced, you can ask a question. If you want to withdraw your question, please lower your hand using the raise hand function in the Zoom app. Thank you. Our first question comes from Nicola Tang with BNP Paribas. You may now unmute your line and ask your question.
Hi, everyone. Thanks for t aking the question. I think I'll start on the advanced orders. I guess no surprise to be asked about this. I think you mentioned, or you estimate a 1% impact group for Q1 if I heard you correctly. I was wondering if you could help us understand, I suppose, how you're calculating that. Secondly, you mentioned it's mainly in Consumer Fragrance. Can you help us understand why? Is it because people are most worried about the supply chain there? Is it where you're implementing the biggest price increases? I would have thought that customers might be more concerned about areas like fragrance ingredients or beauty ingredients or maybe even vitamins, you know, stuff that where the industry, supply is quite concentrated in Asia.
Do you see advanced ordering in these areas, or can you explain why not? Maybe the second one, could you help us understand what assumptions you're making in terms of pricing and input inflation within your reiterated guide? Just help us understand a bit more, you know, the basket of inputs and, you know, how quickly you expect to implement that pricing. Thanks.
Thanks for that question, Nicola. I think the last one will be taken by Ralf. Let me give you a bit of a context on the pre-buying. Indeed, fair challenge. How can you define pre-buying? Well, basically, none of the orders which are filled in are saying this is pre-buying and this is not pre-buying. This is more like looking at the order pattern, and therefore we define this as pre-buying. We saw a bit of an acceleration of the order pattern for delivery in towards the end of March, which is out of the ordinary, and predominantly in Consumer Fragrance. I will try to explain a little bit why that is. We assume that is a part of pre-buying compared to the normal seasonality we have seen.
The majority of the customers are more into concerned supply chain issues. Not so much yet in pricing. I mean pricing in Q1 was hardly impacted, only on freight and a little bit on energy, as Ralf was saying. That was very transparent and not new. What you will see in the Consumer Fragrance predominantly is that if you have launched a big project, and you cannot deliver because you don't have the solutions we offer with the ingredients, then obviously there's a lot at stake. These customers, these big branded customers are not taking any risk, and therefore some of them have pre-buying predominantly in the Consumer Fragrance. That's what we have seen and that we spelled out.
We estimate, it was not a guarantee, but we estimated that had to be more or less maximum 1%. Secondly, be aware that you mentioned pricing. Is that pre-buying on pricing? That's not the case. Remember that in our business model, pricing is only a minor part of the overall costs. The biggest concern is the security of supply. They make their margin on their end products. If they can't supply the ingredients, that is at risk. Last but not least, you know our business model by now a little bit. Our model is not allowing any massive pre-buying. I mean, we have tailored products. We have customized products. We have more than 5,000 ingredients which need to be customized as such. A lot of make to order.
Even if people want to pre-buy massively, our model is not capable in doing that. I hope that gives a little bit of background. Maybe for you, Ralf, a little how much impact it and what we have assumed.
Yeah. Happy to take that. Overall, what Dimitri was highlighting as well, Nicola, we've seen some upward pressure around supply chain and energy. To put things in perspective, we indicated that our energy bill is around 1% of top line, a little over that. Give or take around EUR 100 million, we've seen some upward pressure. The same on logistics, obviously impacted with cost going up. We're passing that on with surcharges. Q1 has seen a bit of an impact given the time lag of passing that through. Overall, in our outlook, we assumed tens of millions of impact, that is something that we're confident in offsetting.
At the same time, you see somewhat inflationary pressure building around some of the raw materials. We're keeping a close eye on that. In all fairness, in the short- term for Q1 and Q2, it was more concern around security of supply. Take, for example, glycols. We've been focusing on securing that to make sure that we can fully deliver to our customers, and we've been successful in that. Given the nature of the industry, we will be able to pass that fully on. Let's see how it overall develops going into the quarter. I think there's still a bit of questions around that. We're therefore sourcing a bit more shorter term to keep track on those developments.
If we see that come through, we will be fully pricing that onwards towards our customers over time. The business is fully on that and monitoring it. Short- term, focus very much on ensuring the delivery and that we've got all the material that we want in order to look at the supply. If you then translate that into the outlook, 'cause I think that's the underlying question. Overall, with a good start in Q1 and a solid start in Q2, and we'll see a bit of support on the OSG from pricing as well.
Obviously, margin, as said, we expect a gradual build up throughout the year. That will require a bit more work with the inflationary environment than the FX where we are heading today. FX was predominantly strong in Q1 with about EUR 40 million of impact. We see somewhat around a little over EUR 20 million in the second quarter, bringing that impact to about EUR 60.5 million . There is another EUR 10 million-15 million per quarter in Q3 and Q4. That will level off on that front as well. On cash, we have got a few levers to manage. Hopefully all that gives a bit of color on what we baked into the outlook.
Yeah. That's great. Thank you. I'll pass it on.
Our next question comes from Alex Sloane with Barclays. You may now unmute your line and ask your question.
Yeah. Hi. Morning, all. Thanks for taking the questions. Two from me, please. First one on Early Life Nutrition within HNC. Nice performance there and you're flagging ARA already as a tailwind. I think at the Investor Day in March, the message was that that tailwind really was gonna build probably from Q2. I just wondered whether that was still the case and how we should think about the kind of the magnitude of the potential revenue opportunity in ARA as a result of the recalls and whether you would just expect that to be a kind of a permanent share gain or more of a kind of a one-off tailwind this year. That's the first one. Second one, just on the follow-up really on the pre-buy comments.
Thanks for the clarification on the scale of that. Should we be expecting a reversal of that 1 point tailwind at some point this year? You know, I guess where, when might we expect that? Thank you.
Let me take the ARA one and then you'll come on further on on the pre-buy. On the ARA, thanks for that, Alex, question. Indeed, we expect that to come through in Q2. Now, obviously, given the need of our customers, we went all the way to free up as much as material as we could to support them. At Capital Markets Day, I indicated that the tailwind for the year is expected to be around 1% on top line growth for HNC for the year. That still stands. At the same time, you're spot on in terms of your question, will we see have some further benefit in the years ahead?
Obviously, that's part of the conversations with our customers as well, where we basically see a request for further volume also in 2027 and 2028. At the same time, we're concluding longer term agreements around that. We're looking at to see how we can create more space in our plans to support them where needed. But for 2026, pencil in about 1% of top line on HNC on the back of the benefit from ARA.
Yeah, Alex, then maybe on the reverse pre-buying. In a world where there is accumulated uncertainty and where there is a very low visibility on what's happening, we don't expect on the short-term reverse pre-buying. On the other hand, I mean, there's a reason why there's reverse pre-buying, because you're concerned about getting access to your ingredients and your solutions. In a perfect world, that will reverse. Now, you hear me say that, we also had a solid start into Q2, we don't see that effect yet. It's very difficult to forecast when that will happen. It will be more or less the same as if you ask me to forecast, when the world become a little bit more certain place with a little bit more predictability.
I've stopped making any remarks on that phase. That should be the answer to your good question on reverse pre-buying as well.
Yeah, that's fair. Thank you.
Our next question comes from Lisa De Neve with MS. You may now unmute your line and ask your question.
Hi. Good morning. Thank you for taking my questions. I have two. The first one is on the dual listing. I mean, it would just be great to hear your thoughts on why you're pursuing that dual listing right now and what are the goals of pursuing this, but also what you aim to achieve with this and whether over the very long- term you aim to sustain your Amsterdam listing. That's my first question. Secondly, back to Perfumery and Beauty. I mean, you delivered very strong performance. Can you just share to which extent that's already driven by the new wins you've obtained in Fine Fragrance and how we should expect that to last through the year, whether actually these volume strengths will continue through the year? Thank you.
I'll take the dual listing, you, P&B. Thanks for question. Now it's something that we wanted to pursue already a bit longer. We've been working on that in the background. At the same time, we said that let's also pursue that once we've transformed the company to DSM-Firmenich going forward. Following the completion of the sale of ANH, that is something that we wanted to do. Now, the additional work resulting from that, given that we've got the listing in Amsterdam was limited. That was a condition to us as well, that we wanted to basically create additional traction and also basically access a market where we have a strong home base.
I mean, if you look at the company, there's a strong heritage in both the Netherlands and Switzerland. We want to capitalize on that. Hence, the pursuit of the second listing. It gives us access to an investor base that we can't have access today. With that, we expect further volume flow in the stock at basically a limited effort. It's clearly a dual listing. We have no intent to withdraw from Amsterdam. It will be something that we have active in both places, coupled also with an ADR program in the U.S.
We basically optimize our offering to our investor base and make use of all the available capital and through that support the flow of the stock. It's been part of the plan, but was kind of put on hold until we've completed the transformation, which we can then actively roadshow also in the Swiss market, which is an interesting space for us as well, given the strong presence in both countries.
Indeed, maybe on the wins, thanks for that question. I think we have a very strong brief pipeline. Remember, Emmanuel was on stage during the Capital Markets Day presenting that. I also remember that there were questions like, "Okay, if that strong brief pipeline is there, when do we see that back into organic sales growth?" I think we at that time radiated quite some confidence, and I'm very happy that we could report a very strong quarter one. It has to do with wins we've got in 2025 and now result in business in 2026. Let me also remind you that we had low single-digit growth on ingredients, the fragrance ingredients, and I think in the broader context, that's an important element to the wins.
I can tell you that the last wins we've made in 2025, but also into 2026, were very successful because we have launched a new, innovative, new ingredients which we own ourself. It's part of our business model in going forward. Yeah, I think a very strong start for Perfumery and Beauty, predominantly because of the good pre-brief pipeline, but above all, also because of a very good win percentage on these briefs, going into Q1 with confidence for the rest of the year.
Thank you.
Our next question comes from Georgina Fraser with Goldman Sachs. You may now unmute your line.
Hi. Good morning, everyone. Thanks for taking my questions. My first one is, honestly, as a team, I think you're really well placed to manage the supply chain issues that we're seeing on the back of the Middle East conflict because of the experience that you've had in the old DSM portfolio and also still in discontinued operations in vitamins. I would really love to hear your read on the challenges that we're actually seeing today. Are we facing potentially risks of shortages of products? What would be your timeframe for that related to the closure of the Strait of Hormuz? My second question was, you flagged U.S. consumer weakness around Dietary Supplements in particular. Could you give us your read on the health of consumer demand into the second quarter by region? Thank you.
Thank you for that question. Indeed, you referred to the experience of legacy DSM, but I can also remind you that the legacy Firmenich also had quite some experience in handling COVID and inflationary context. I think we're well set. Like Ralf was saying, in Q1 we saw freight and energy costs going up, we immediately took action and priced that in with full compensation in Q2. Like Ralf was also saying, what we have seen is some increases in raw material costs. We saw that in glycol, we immediately took actions there. This is about agility. I think nobody knows which type of derivatives from oil will hit the most.
The only thing is that you need to prepare yourself to act with agility in going forward. That's what we've done. I think glycol is a good reference. I think we did not miss an order because we didn't have access to glycol, which is a key raw material in the whole perfume space, and you can see that in our organic sales growth. I think it's more about attitude and agility, which we have on the organization DSM-Firmenich as a whole. Secondly, on your North America space, very interesting indeed. We flagged North America cautious consumer behavior. Europe in all of this is still relatively stable with, I think, a good context in Asia.
Now, we flagged it predominantly because of Health, Nutrition and Care, which has a big exposure in North America because of biomedical and eye health and the likes. We don't see a deterioration, we don't see a pickup either. The consumer behavior, which is still cautious. In that context, we've taken actions. Eye health has seen slight growth in that cautious consumer behavior. Biomedical is doing relatively well. I think we also there took actions to do what is needed to drive growth in a difficult, cautious behavior consumer context. We don't expect any change towards the next coming quarters unless the world becomes a safer and easier place going forward.
We feel we're well-positioned. Fair, North America is cautious consumer behavior. Europe stable and Asia pretty okay.
If I can add to that, keep in mind also, the comps in both TTH and HNC, where we saw a very strong Q1 last year with 7% and 6% growth with the strong Dietary Supplements that we called out at the time. That's to be seen in that light as well.
Thank you very much.
Our next question comes from Chetan Udeshi with JP Morgan. Please unmute your line. Please unmute your line by pressing the microphone button at the bottom left hand corner of your Zoom screen.
Hi, can you hear me now?
Yep. Loud and clear, Chetan. Good morning.
Morning. I just wanted to dig a little bit in your P&B margin. you know, very strong volume growth, 8%. I was just trying to do some math. You know, I would assume, you know, this is a business probably with the highest gross margins. You know, if I take 45% gross margin on your incremental volumes, you know, that should be something like EUR 35 million EBITA uplift. Even after FX, you know, we should be close to EUR 20 million. I'm a bit puzzled with the lack of operational leverage in the P&B business. So maybe if you can just help us sort of, you know, bridge the key moving parts.
You talked about cost, but they don't seem that big in the context of the lack of operational leverage that we saw in Q1. Nothing to take away from the strong volume performance, but perhaps you were expected to see better margins there from that volume. The second question, when you talk about solid start, are we to interpret that to be similar to your 1%-4% growth into Q2? Any color on how we should think about margins, you know, in Q2 should be similar to Q1, or would you expect a progression, sorry, from Q1? Thank you very much.
All right, I'll take the P&B margin, and then you maybe can voiceover a bit the start of the second quarter and what we expect there then. Overall, margin of 22%, it's somewhat above the average of last year, we do see an improvement on that front. The leverage is a 5% step up in margin. Now a few bits and pieces, I would say, small impact across the board, whether it was FX, whether it was some additional cost coming through that we're passing on, as indicated with the time lag. At the same time, we continue to invest for future growth.
I mean, that is also something that we continue to do. So that is also something that you witness at P&B. We've seen that, we've highlighted that also last year that we're setting ourselves up for continued growth in the fronts and with that. All of those pieces have a little impact on the overall margin, but we have the ambition to move up, but at the same time, do it in a responsible way to make sure that we capitalize on the growth, because ultimately that will be the driver for the profitability, and that is something that we now see coming through.
It's a bit of those moving pieces across the board with the ambition to continue to improve the margin and thread that. You see the operating leverage, but at the same time is offset by by a few things that that we're either passing on or is a deliberate choice at at our end.
Then to your second question, let me not give an outlook per quarter for every business, but we gave an outlook for the year, 2%-4%. You hear me say that we had a solid start also into Q2, so we feel confident on that outlook for 2%-4%. I think it's fair to say that we expect P&B to be a little bit on the upper end of that outlook and then a little bit better than what TTH and HNC will bring in. Then in terms of the margin, overall margin, I think TTH, like Ralf was saying, I would like to reemphasize that a bit of Bovaer effect.
We have the orders in for Q2, so you will see a step up on the margin of TTH into Q2. That will move more towards the 20% with all the actions taken. That is on TTH. I think for the rest, we were happy with the margins on HNC and P&B. Remind you that for the group, the negative FX effect was the biggest in Q1. Ralf was alluding to that, and it will be slightly less for Q2, and then I think it will be phased out throughout the second half of the year with only a minor effect.
With that, I think we made the link to our outlook and maintained therefore the outlook because we feel confident with what we've seen.
Thank you very much.
Our next question comes from Matthew Yates with Bank of America. Please unmute your line.
Hey, good morning, everyone. Couple of questions, please. Maybe just to follow up on that margin progression point. Ralf, you've called out a few moving parts here over the coming quarters. If you wouldn't mind just recapping how that margin is gonna trend up over the coming quarters. Sounds like you're sort of catching up with the lag on cost and pricing, and then to some extent there's some mix and maybe some underlying cost actions. If you wouldn't mind just sort of recapping so we can have confidence in that trajectory. Then the second question on TTH. In the press release, I didn't see any sort of discussion of different product categories.
In particular wanted to ask you about dairy because it was something you highlighted at the CMD a month or so ago. We've seen some of your peers continue to report very good growth in dairy. Are you also capitalizing on those opportunities? Thank you.
Right. You wanna start with TTH and dairy?
Yeah, dairy, indeed. Good question. It's a trading update, so we didn't wanna give all the details on the segments, I really reconfirm what you just said and what we've said in the CMD. The dairy segment is a fast-growing segment on the back of consumer be more linked to health. Also the GLP-1, I said it in the CMD, this is something where I think the dairy segment is seen as a very positive contribution to it. Obviously, with culture and probiotics as interesting product for us. No, I would like to reconfirm that dairy is a winning segment.
I think I just need to remind you there that we're definitely the leader in the dairy segment in the TTH space, and we benefit from that.
All right. On the margin trajectory, I mean, overall from the group, we anticipated that. I think, one of the key drivers is the FX, which had the strongest impact in the quarter. As said, that will fade out with half of the impact in Q2 and even less so in Q3 and Q4. Typically, we always see an improvement in the margin throughout that. If you look at specifically at Q1, Matthew, I mean, TTH has an impact on the overall margin from the group as well.
If you were to adjust for those one-off costs in the bits and pieces that we will be passing on, and with that neutralized into the second quarter and onwards, and also adjust for that impact of Bovaer and TTH, you would see that actually the margin will be above the 19.5% towards the 20%, and that is something that we see throughout the year. Expect a gradual improvement. Overall, we feel comfortable with the guidance that we gave. We feel that that is balanced. You'll see that coming through nicely with the actions that we're taking and passing that onward.
That adverse impact of a couple of million coupled with Bovaer and TTH will fade out and expect a gradual increase to be in line towards the guidance that we gave.
Okay. Thank you both.
Our next question will come from Artem Chubarov with Rothschild. Please unmute your line.
Yes. Thank you. Good morning, everyone. Thanks for taking my question. I've got one on Bovaer, please. Just trying to understand the technicalities really. Just to make sure I understand. 1% was the impact on organic sales in TTH. From memory, this is about what the business represents in the total sales. Does that mean that the entirely quarterly volume was shifted in another quarter? Is that typical? Obviously, you never reported that with TTH before it was part of Animal Nutrition. Just trying to understand if this is something we can expect going forward, or is it something extraordinary? Maybe generally for Bovaer, how do you see sales progressing for the rest of the year, and maybe where you see profitability for this business?
I think you mentioned that it was operating at a break even, given that volume's obviously very low. Where do you see profitability getting from here? Thank you.
Thanks for that question. Indeed, Bovaer, it is, it can differ per quarter, but it basically will not differ for the year, because you basically need to have your year quarter. Last year we had EUR 14 million sales. This year we expect maybe even slightly higher. Here in this case, we're sold out because we're building that factory will be mechanical complete towards the end of the year. This year we will see around that same sales number, EUR 40 million-EUR 45 million. Last year in 2025, we had, just to be precise, about EUR 13 million of sales and EUR 7 million in quarter two. We've seen EUR 7 million this year in quarter one, and we have the orders in for Q2.
Now it's more or less reversed, EUR 7 million and EUR 13 million. That's part of the deal. For the whole year, you can expect EUR 40 million-EUR 45 million with indeed about breakeven on results because that's something where we are in the intermediate phase. No surprises there, only some changes throughout the quarter.
Yeah. Thank you.
Our last question comes from Charles Eden with UBS. You may now unmute your line.
Hi. Morning. Thanks for sneaking me in. I just wanted to ask on ANH and vitamin prices. I appreciate this is a continuing ops update, but vitamin prices have obviously spiked. I guess costs have also gone up, particularly energy in Europe. Is it fair to say the move is advantageous to profitability for ANH, and I guess cash flow for this year, given you've still got 100% of the cash flows? That was my one question. Then just a very quick clarification, bit specific. You talk about strong double digits in Fine Fragrance. Does strong double digits for DSM mean mid-teens? Just I don't want the exact number, but just an idea of what strong double digits means. Thank you.
Let me take the discontinued, then Dimitri will give you the exact number on Fine Fragrance, Charles. Morning, sir. Absolutely right. I mean, you've seen how vitamin prices go up 30%, 40% across the board, which is obviously helpful for overall achieving the results. There is a cost component to it. You're absolutely right on that in terms of costs that will go into premix, but also at the energy side. Obviously, this is a much more balanced picture than what we've seen before. I mean, if you go back and rewind the clock a few years back then, we saw predominantly energy and costs go up in Europe, whereas I think this is more of a global development where China is impacted.
We're happy to see the prices go up, and as you say, we are still the owners of that business throughout the year, so it will help. We're managing the business for cash. That hasn't changed, and that is something that we're focused on. Obviously this environment is overall supportive to the business in 2026. In the annex, we put the results for discontinued in as well for reference for modeling. We clearly indicated that we had an anticipated weaker start of the year, but we expect a strong pickup in the quarters ahead on the back of that improved pricing.
Indeed, Charles. I mean, very funny that you're still so much in love with vitamins, but I still appreciate your question. I'm pretty sure you also follow Feedinfo, and you see vitamin E prices went up from EUR 5 to around EUR 11. I think that's pretty much enough to compensate slight cost increases. Like Ralf was saying.
We're happy to see that the vitamin prices are normalizing. It's okay. Going from one end of the range to the other end of the range, you really go from vitamins, animal nutrition to the top end, Fine Fragrance. Indeed double-digit. My preference is that it's mid-teens, even maybe high teens, it has been low teens. Remember that Fine Fragrance we normally guide towards the high single-digit norm right now. Quarter one, we had low teens, double-digit. I'm very happy with that. We'll need to see how that continues to fare throughout the year. We clearly indicated that we have a strong brief pipeline and good wins.
To your question, it has been low teens for quarter one.
Yeah. That brings it then to the end of the Q&A session. We don't have anybody in the queue anymore. Operator, I suggest we close this session and we move on.
This concludes the Q&A session. I will now hand back to Mr. Huizing.
Yeah. Thank you, operator. Dimitri, do you want to make some closing remarks?
Well, not really. Just want to remind you that, despite what's going on out there in the world, we really focus on what we promised in the Capital Markets Day. We focus, we accelerate, and we execute. We grow what we have with an organic sales growth for the outlook to the 4%. We anchor what we do, implementing our cost programs, focusing on the cash, with the EBITDA quality about 20% and deliver on our promises. I think we had a solid start into the year with a good quarter one, moving into a good start into Q2. With that, I'm very happy to see that we maintained our outlook in a continuous crazy world.
I think we are very much geared up to that and hope to speak to you soon in the road or otherwise again during our half year results. Thank you for that.
Yeah. Thank you. That brings us to the end of today's call. Thank you all for attending the call today. Please don't hesitate to reach out to us if you have any remaining questions. With that, we conclude today's webcast.