In addition, Frutarom is also progressing with plans to integrate a number of production sites and moving other activities to countries where operational costs are lower. The contribution of these activities will come to fruition starting in the second half of 2013.
The Company reports continued rapid growth in third quarter sales, to US$157.1 M, a 24% growth net of currency effects, compared with US$135.3 M during the same quarter in 2011. In dollar terms, sales grew by 16.2%. Frutarom's sales in the Flavors segment, the most profitable of the Company's activities, grew, net of currency effects, by 26.4% during Q3 of this year, compared with the same quarter last year, reaching a third quarter record high of US$114.2 M. Flavors' sales already constitutes 73% of total Frutarom sales (compared with 40% in 2001).
Over the first nine months of 2012, Frutarom sales grew, net of currency effects, by 27.9%, achieving record sales for the first nine months of US$473.1 M, versus US$386.9 M during the first nine months of 2011. In dollar terms, sales grew by 22.3%. Frutarom's sales in the Flavors segment, net of currency effects, increased by 34.6% compared with the first nine months of last year, reaching a high of US$345.6 M for the first nine months. Frutarom's internal growth in Flavors is above growth rates in the main markets in which Frutarom operates and in markets which are strategic for the Company, with an emphasis on North America, Latin America, Asia, Africa and Central and Eastern Europe.
The trend of improvement in profit and gross and operational margins continues. Organic growth, strategic acquisitions, adjustments in Frutarom's product selling prices to its customers, continued stabilization and even the start of a decrease in the prices of some of the raw materials Frutarom uses in the manufacture of its products, actions taken for lowering costs of raw materials by strengthening global purchase and utilization of the many operational synergies derived from the recent acquisitions and improvement in the cost structure have led to a significant rise in Frutarom's margins and profit, also expected to continue in 2013.