EANS-News: Results for the first half of 2020|21 (ended 31 August 2020) - AGRANA boosts EBIT and revenue
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Forecast: EBIT at least matching prior-year level
Mid Year Results
Vienna - AGRANA, the fruit, starch and sugar company, generated operating profit
(EBIT) of EUR 55.8 million in the first half of the 2020|21 financial year, a
moderate increase of 7.9% year-on-year (H1 prior year: EUR 51.7 million). The
Group's revenue rose slightly to EUR 1,309.3 million (H1 prior year: EUR 1,250.0
million).
AGRANA Chief Executive Officer Johann Marihart says: "Much of our positive
business performance can be credited to the diversification of our business
activities, which enables us to balance out fluctuating economic conditions in
the various segments. Thus, in the first half of the year, the Starch segment
was able to maintain the prior year's EBIT earnings despite significantly weaker
starch sales in the paper sector, thanks to the very strong performance in
bioethanol especially in the second quarter."
Helping make the year-on-year growth in Group EBIT possible was the Sugar
segment, which, as in the first quarter, saw a year-on-year improvement in
earnings in the second quarter as a result of higher sugar prices. The Sugar
segment's EBIT nonetheless remained negative. In the Fruit segment, AGRANA was
able to hold earnings in the fruit preparations business in line with the first
half of the prior year. The performance of the fruit juice concentrate business
was down significantly due to lower available volumes from the 2019 apple crop.
AGRANA Group consolidated financial results
EUR million, except %
H1 2020|21 H1 2019|20
Revenue 1,309.3 1,250.0
EBITDA* 101.1 90.8
Operating profit** 47.7 44.0
Share of results of equity-accounted joint ventures 8.9 7.7
Exceptional items (0.5) 0.0
Operating profit (EBIT) 55.8 51.7
Net financial items 4.3% 4.1%
Profit for the period 34.4 28.9
Investment*** 27.8 68.1
Q2 2020|21 Q2 2019|20
Revenue 656.7 611.6
EBITDA* 46.4 39.3
Operating profit** 19.3 16.5
Share of results of equity-accounted joint ventures 5.0 4.3
Exceptional items (0.5) 0.0
Operating profit (EBIT) 23.8 20.8
EBIT margin 3.6% 3.4%
Profit for the period 15.2 10.6
Investment*** 16.7 34.5
* EBITDA represents operating profit before exceptional items, results of
equity-accounted joint ventures, and operating depreciation and amortisation
** Operating profit before exceptional items and results of equity-accounted
joint ventures
*** Investment represents purchases of property, plant and equipment and
intangible assets, excluding goodwill
Net financial items amounted to an expense of EUR 9.1 million (H1 prior year:
expense of EUR 7.9 million). After an income tax expense of EUR 12.3 million,
corresponding to a tax rate of about 26.3% (H1 prior year: 34.0%), profit for
the period was EUR 34.4 million (H1 prior year: EUR 28.9 million). Earnings per
share attributable to AGRANA shareholders increased to EUR 0.54 (H1 prior year:
EUR 0.43).
Net debt at 31 August 2020 amounted to EUR 479.6 million, up EUR 15.6 million
from the year-end level of 29 February 2020 (year-ago level of 31 August 2019:
EUR 423.6 million). The gearing ratio rose accordingly to 36.1% as of the
quarterly balance sheet date (29 February 2020: 33.5%; 31 August 2019: 31.2%).
Fruit segment
EUR million, except %
H1 2020|21 H1 2019|20
Revenue 601.8 595.6
Operating profit (EBIT) 30.1 36.1
EBIT margin 5.0% 6.1%
Q2 2020|21 Q2 2019|20
Revenue 298.1 284.1
Operating profit (EBIT) 14.1 14.3
EBIT margin .7% 5.0%
The Fruit segment's revenue in the first half of 2020|21 rose slightly year-on-
year, by 1.0%. In the fruit preparations business, revenue remained stable
despite somewhat lower sales volumes. Revenue in the fruit juice concentrate
activities saw an increase from a year ago, thanks largely to higher prices for
apple juice concentrate produced from the 2019 crop. EBIT of the Fruit segment
was off 16.6% from the first half of 2019|20. The reason for the deterioration
lay in lower delivery volumes in the fruit juice concentrate business combined
with reduced contribution margins for apple juice concentrate from the 2019
harvest.
Starch segment
EUR million, except %
H1 2020|21 H1 2019|20
Revenue 407.2 407.8
Operating profit (EBIT) 34.7 34.3
EBIT margin 8.5% 8.4%
Q2 2020|21 Q2 2019|20
Revenue 202.8 200.1
Operating profit (EBIT) 17.7 15.9
EBIT margin 8.7% 7.9%
Starch segment revenue in the first half of 2020|21 was steady at the prior-year
level. With the full operation of the new, second wheat starch plant, sales
volumes and revenues of the products manufactured in-house increased. At the
same time, revenue from resold merchandise declined sharply, as the sale of
sugar by-products is now charged on a commission basis and the corresponding
sales are no longer included in the Starch segment's revenue. Ethanol
quotations, after collapsing in March 2020 amid the COVID-19 lockdown and the
steep fall in demand for petrol, recovered again progressively especially in the
second financial quarter and even reached a new all-time high in August. Sales
volumes of saccharification products, on the other hand, were negatively
affected by the COVID-19 crisis, particularly with the beverage industry.
EBIT in the Starch segment slightly exceeded the year-earlier result, by 1.2%.
The earnings were driven by the high selling prices for ethanol, which made up
for the lower market demand for starch and starch products.
Sugar segment
EUR million, except %
H1 2020|21 H1 2019|20
Revenue 300.3 246.6
Operating profit (EBIT) (9.0) (18.7)
EBIT margin (3.0%) (7.6%)
Q2 2020|21 Q2 2019|20
Revenue 155.8 127.4
Operating profit (EBIT) (8.0) (9.4)
EBIT margin (5.1%) (7.4%)
The Sugar segment's revenue in the first half of 2020|21 was up 21.8% from one
year earlier. This growth was attributable both to higher sugar selling prices
and increased sugar sales volumes, especially with food retailers. Although EBIT
was still negative, it marked a substantial improvement from the same period of
the prior year due to a more benign sales price environment.
Outlook
Taking into account potential impacts of the coronavirus crisis, AGRANA expects
Group EBIT for the full 2020|21 financial year to at least match the prior-year
level. Group revenue is projected to show slight to moderate growth of up to
10%. Due to the ongoing COVID-19 pandemic and the associated high volatility in
all business segments, this forecast remains characterised by a very high degree
of uncertainty. It also does not yet include any financial effects of a possible
closure of the sugar plant in Leopoldsdorf, Austria, after the 2020 campaign.
The drive to secure grower contracts with beet farmers is underway, with the aim
of increasing next year's beet cultivation area in Austria to at least 38,000
hectares by the middle of November 2020. With a three-year contract and
guaranteed minimum prices, AGRANA is offering farmers long-term predictability
for beet cultivation. Depending on the contracting status in mid-November, a
decision will be made on whether to continue operations at the Leopoldsdorf
factory or close it down after the end of the campaign.
In the 2020|21 financial year, the AGRANA Group's investment is expected to
amount to EUR 73 million, which is significantly below the year's depreciation
of about EUR 120 million following the very high capital expenditure of prior
years.
About AGRANA
AGRANA converts agricultural raw materials into high-quality foods and numerous
industrial intermediate products. About 9,400 employees at 56 production sites
worldwide generate annual Group revenue of approximately EUR 2.5 billion.
Established in 1988, the company is the world market leader in fruit
preparations and the foremost producer of fruit juice concentrates in Europe. As
well, its Starch segment is a major manufacturer of custom starch products and
of bioethanol. AGRANA today is also the leading sugar producer in Central and
Eastern Europe.
This announcement is available in German and English at www.agrana.com [https://
www.agrana.com/en]
Further inquiry note:
AGRANA Beteiligungs-AG
Mag.(FH) Hannes Haider
Investor Relations
Tel.: +43-1-211 37-12905
e-mail:hannes.haider@agrana.com
Mag.(FH) Markus Simak
Public Relations
Tel.: +43-1-211 37-12084
e-mail: markus.simak@agrana.com
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