FRUT CAC Utilities

QUARTERLY GROWTH OF 11.3% IN REVENUES TO USD 234.5M AND 15.9% IN EBITDA TO USD 45.2M; HIGHEST EVER IN COMPANY HISTORY

Frutarom Industries Ltd. ("Frutarom"), one of the world's 10 largest companies in the field of flavors and specialty fine ingredients, reports attaining in the first nine months of 2015 record levels in sales reaching US$ 647.2 million, in gross profit reaching US$ 251.1 million, in operating profit reaching US$ 99.4 million, in EBITDA reaching US$ 122.8 million, in net income reaching US$ 72.6 million and in earnings per share. The third quarter of 2015 was also a record-setting quarter for sales which reached US$ 234.5 million, for operating profit which reached US$ 37.0 million, and for EBITDA which reached US$ 45.2 million. Net income for the quarter reached US$ 25.0 million.

The record results for the third quarter of 2015 and for the first nine months of the year, both in sales and in profits, were achieved despite the significant effects of changes in the exchange rates of currencies in which Frutarom transacts business against the US dollar. In addition, during the quarter non-recurring expenses were recorded for actions being taken by Frutarom to optimize its resources, merge production plants, and achieve maximal operational efficiency, as well as for the acquisitions carried out. These non-recurring expenses reduced the reported operating profit by US$ 2.4 million for the quarter and by US$ 4.6 million for the first nine months of the year. Furthermore, non-recurring financial expenses of US$ 4.3 million were recorded in the third quarter on the revaluation of a financial liability for an option for the purchase of the minority shares of PTI following the better than anticipated results of its activity.

Net of non-recurring expenses, Frutarom registered record results for the third quarter of 2015 and for the first nine months of the year in the profitability margins of its core business, the Flavors and Specialty Fine Ingredients activities, which stood for the quarter at gross margin of 41.0%, EBITDA margin of 22.1%, and operating margin of 18.3%. In the first nine months of the year the gross margin for core activity stood at 40.9%, the EBITDA margin at 21.4%, and the operating margin at 17.5%.

The continued successful integration of the acquisitions made in recent years into Frutarom's global activity has also contributed to both the growth in sales and to the improvement in profits and margins. Since the beginning of 2015 Frutarom has carried out 11 acquisitions, three of them since the beginning of the third quarter: the acquisitions of US-based Scandia, which engages in specialty citrus solutions, and of Nutrafur in Spain, which engages in the field of natural extracts, as well as of the Polish company AMCO (for which the purchase agreement was signed in November) which engages in the field of savory solutions (the non-sweet spectrum of flavors) in Poland. Frutarom believes the acquisitions it has performed offer many potential synergies and operational savings that are expected to be reflected in its results over the upcoming quarters and it is taking action to successfully integrate them and fully tap the great potential they bring it.

Sales

Frutarom's sales in the third quarter of 2015 rose by 11.3% to reach a quarterly record of US$ 34.5 million compared with US$ 210.8 million in the parallel quarter, reflecting constant-currency growth on a pro-forma basis4 of 4.5% from the parallel period.

Frutarom's sales and profits were impacted in the third quarter of 2015 by the continuing trend of the considerable strengthening of the US dollar against most other world currencies. Since about 70% of Frutarom's sales are transacted in currencies other than the US dollar (mainly the Euro, Pound Sterling, Swiss Franc, Russian Ruble, New Israeli Shekel, Chinese Yuan, Brazilian Real, Peruvian Nuevo Sol and South African Rand), the changes in exchange rates have an effect on Frutarom's reported US dollar results. Nonetheless, the fact that purchases of the raw materials used in manufacturing Frutarom products and the operating costs in the various countries in which it operates are in most cases also paid for in local currencies serves to reduce the Company's currency exposure, such that most of the effect is on the dollar translation of sales and profit figures.

The resulting impact from currency exchange rates on Frutarom sales and profits was 14.6% for the third quarter and 14.2% for the first nine months of 2015.

It should be pointed out that the strengthening trend of the US dollar began taking shape mainly during the fourth quarter of 2014 such that, if exchange rates remain at their current levels, its effect on Frutarom's reported results in 2016 can be expected to diminish considerably.

Sales for the Flavors activity as reported in US dollars rose 9.4% to reach US$ 165.4 million in the third quarter of 2015 compared with US$ 151.1 million in the parallel quarter last year, and reflect constant-currency growth on a pro-forma basis of 5.4% from the parallel period. The currency effects reduced sales on a pro-forma basis by 15.2%.

Sales for the Specialty Fine Ingredients activity as reported in US dollars grew by 18.4% to reach US$ 48.3 million in the third quarter of 2015 compared with US$ 40.8 million in the parallel quarter last year, and reflect constant-currency growth on a pro-forma basis of 1.2% from the parallel period. The currency effects reduced sales on a pro-forma basis by 7.3%. The effect of stockpiling of inventory by several customers, as reported in the second quarter of this year, has diminished as expected, and Frutarom believes its Specialty Fine Ingredients activity will go back to growing at a higher pace.

Sales for Trade and Marketing activity in the quarter as reported in US dollars rose by 8.5% to reach US$ 21.8 million compared with US$ 20.1 million in the parallel period last year, reflecting constant-currency growth on a pro-forma basis of 4.2% from the parallel quarter in 2014.

Frutarom sales for the first nine months of 2015 as reported in US dollars rose 4.8% to reach a record US$ 647.2 million, and reflect constant-currency growth on a pro-forma basis of 5.1% from the parallel period. Significant changes, as stated, in the exchange rates of currencies with which the Company operates against the US dollar reduced sales growth in pro-forma terms by 14.2%.

Sales for the Flavors activity in the first nine months of 2015 as reported in US dollars rose 1.9% to reach US$ 450.6 million compared with US$ 442.0 million in the parallel period last year, and reflect constant-currency growth in pro-forma terms of 5.8% from the parallel period. The currency effects reduced sales on a pro-forma basis by 14.9%.

Sales for the Specialty Fine Ingredients activity in the first nine months of 2015 as reported in US dollars grew by 9.9% to reach US$ 136.7 million compared with US$ 124.4 million in the parallel period last year, and reflect constant-currency growth in pro-forma terms of 0.6% from the parallel period. The currency effects reduced sales on a pro-forma basis by 7.4%.

Sales for Trade and Marketing activity in the first nine months of 2015 as reported in US dollars rose by 12.4% to reach US$ 63.5 million compared with US$ 56.5 million in the parallel period last year, reflecting constant-currency growth in pro-forma terms of 5.8% from the parallel period in 2014.

Profits and margins

For the first three quarters of 2015:

In millions of US dollars	Core Business Activity									Total Frutarom Group
	Flavors and Specialty Fine Ingredients
	Adjusted for non-recurring expenses						% increaseon a constant currency basis and adjusted for non-recurring expenses			Adjusted for non-recurring expenses						% increaseon a constant currency basis and adjusted for non-recurring expenses
	YTD 2014			YTD 2015						YTD 2014			YTD 2015
Gross profit		230.5			239.0			18.1	%		241.0			252.6			20.8	%
Margin		41.1	%		40.9	%					39.0	%		39.0	%
Operating profit		89.3			102.0			30.0	%		90.7			104.0			31.9	%
Margin		15.9	%		17.5	%					14.7	%		16.1	%
EBITDA		113.3			125.1			25.3	%		115.0			127.4			26.8	%
Margin		20.2	%		21.4	%					18.6	%		19.7	%
Net income											68.3			80.0			34.2	%
Margin											11.1	%		12.4	%

For the third quarter of 2015:

In millions of  US dollars	Core Business Activity										Total Frutarom Group
	Flavors and Specialty Fine Ingredients
	Adjusted for non-recurring expenses							% increase on a constant currency basis and adjusted for non-recurring expenses			Adjusted for non-recurring expenses						% increase on a constant currency basis and adjusted for non-recurring expenses
	Q3 2014			Q3 2015							Q3 2014			Q3 2015
Gross profit		77.7			87.3				29.0	%		81.6			92.1			31.5	%
Margin		40.8	%		41.0		%					38.7	%		39.3	%
Operating profit		30.8			39.0				45.3	%		30.9			39.4			47.1	%
Margin		16.2	%		18.3		%					14.7	%		16.8	%
EBITDA		38.8			47.1				39.0	%		39.3			47.6			40.3	%
Margin		20.3	%		22.1		%					18.6	%		20.3	%
Net income												24.4			30.9			47.8	%
Margin												11.5	%		13.2	%

Earnings per share

Earnings per share in the third quarter of 2015 on a constant-currency basis and net of non-recurring expenses jumped 48.5% from US$ 0.35 per share in the third quarter of 2014 to US$ 0.52. Without adjusting for currency effects or non-recurring expenses, earnings per share in the third quarter of 2015 rose 2.9%, from US$ 0.41 in the parallel quarter to US$ 0.42.

Earnings per share for the first nine months of 2015 on a constant-currency basis and net of non-recurring expenses climbed 35% from US$ 1.00 per share for the first nine months of 2014 to US$ 1.36. Without adjusting for currency effects or non-recurring expenses, earnings per share for the first nine months of 2015 rose 6.6% to reach a record US$ 1.23 per share.

Cash flow from operating activities

Cash flow from operating activities grew by 32.1% for the first nine months of 2015 from US$ 50.6 million to a record US$ 66.8 million.

In the third quarter of 2015 the cash flow from operating activities registered 39.6% growth, from US$ 21.1 million to US$ 29.4 million.

Investor Conference Call

On Thursday, November 19, 2015 at 4:00pm Israel time (2:00pm BST or 9:00am EST) Frutarom will host a conference call in which management will review and discuss the results and will be available to answer investor questions.

To participate, please call one of the following teleconferencing numbers.  Please begin placing your calls at least 5 minutes before the conference call commences. If you are unable to connect using one of the toll-free numbers, please try the international dial-in number.

USA Dial-in Number: 1-888-668-9141UK Dial-in Number: 0-800-917-5108SWITZERLAND Dial-in Number: 0-800-834-878ISRAEL Dial-in Number: 03-918-0644INTERNATIONAL Dial-in Number: +972-3-918-0644

Beginning November 20, 2015 a recording of the conference call can be found on the Company's website at www.frutarom.com.  Contact Details: ir@frutarom.com, +972-9-9603800

About Frutarom

Frutarom (LSE:FRUT), (TASE:FRUT) is a multinational company operating in the global flavors and fine ingredients markets. Frutarom has significant production and development centers on four continents and markets and sells over 43,000 products its products to over 19,000 customers in more than 150 countries. Frutarom’s products are intended mainly for the food and beverages, flavor and fragrance extracts, pharmaceutical, nutraceutical, health food, functional food, food additives and cosmetics industries.

 Frutarom employs approximately 3,500 people worldwide and engages in two core activities:

• The Flavors Activity, which develops, produces and markets flavor compounds and food systems.
• The Specialty Fine Ingredients Activity, which develops, produces and markets natural flavor extracts, natural functional food ingredients, natural pharma/nutraceutical extracts, natural food colors, natural algae based biotechnical products, natural antioxidants used in natural preservation and food protection systems aroma compounds, essential oils, unique citrus products, natural gums and resins. The Specialty Fine Ingredients products are sold primarily to the food and beverages, flavor and fragrance, pharmaceutical/nutraceutical, cosmetics and personal care industries

Frutarom’s products are produced at its plants the US, Canada, the UK, Switzerland, Germany, Belgium, Italy, Spain, Slovenia, Russia, Turkey, Israel, South Africa, China, India, Guatemala, Peru, Chile, Brazil and New Zealand. The Company’s global marketing organization encompasses branches in Israel, the US, Canada, the UK, Switzerland, Germany, Slovenia, Belgium, the Netherlands, Denmark, France, Italy, Spain, Hungary, Romania, Russia, the Ukraine, Poland, Kazakhstan, Belarus, Turkey, Brazil, Mexico, Guatemala, Costa Rica, Peru, Chile, South Africa, China, Japan, Hong Kong, India, Indonesia and New Zealand. The Company also works through local agents and distributors throughout the world.  For further information, visit our website: www.frutarom.com.

1 In Q3 2015 and in the first nine months of the year, included were non-recurring expenses that reduced operating profit by a total of US$ 2.4 million and US$ 4.6 respectively concerning steps being taken towards optimization and the streamlining of purchased activities, as well as expenses connected with purchase transactions. Also recorded in Q3 2015 was a non-recurring financial expense of US$ 4.3 million attributed to the revaluation of financial liabilities on an option for the purchase of the minority shares of PTI following the better than anticipated results of its operations.

2 Assuming acquisitions performed in 2015 had been consolidated in the appropriate parallel period of 2014 and that Montana Food, acquired during the fourth quarter of 2014, had been consolidated as of January 1, 2014.

3 On a constant currency basis and adjusted for non-recurring expenses.

4 If the Company's Profit & Loss Statements for the equivalent period in 2014 had been translated into US dollars according to the average exchange rates in effect during the relevant period of 2015, and assuming acquisitions performed in 2015 had been consolidated in the appropriate parallel period of 2014 and that Montana Food, acquired during the fourth quarter of 2014, had been consolidated as of January 1, 2014.