DGAP-News: KWS SAAT AG: KWS SAAT AG continues its profitable growth
(firmenpresse) - KWS SAAT AG / Key word(s): Final Results
28.10.2010 07:30
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Net sales up 5% to EUR754 million - KWS surpasses operational targets while
also investing in sustainable growth - EBIT rises 6% to EUR82 million -
Dividend increases to EUR1.90
(Einbeck, October 28, 2010/No. 32/gf) - KWS SAAT AG (ISIN: DE0007074007),
one of the world's leading seed companies, surpassed its operational
targets in the fiscal year 2009/2010, which ended on June 30. It continued
to grow profitably, largely unaffected by economic crises and strong
fluctuations in the prices for agricultural raw materials. The KWS Group's
net sales rose by 5.1% to EUR754.1 million. The cost of product development
increased by 9% to around EUR98 million, but was offset by operational
growth. In addition, provisions were able to be reversed. As a result,
earnings before interest and taxes (EBIT) improved by 5.8% to EUR82.4
million. Net income for the year was negatively impacted by a drop in net
financial income due to lower interest on investments, but at EUR51.5
million was still EUR1.4 million above last year's figure. Shareholders
will participate in these improved earnings with a dividend per share of
EUR1.90, up once again by EUR0.10. Earnings per share were EUR7.51
(previous year: EUR6.98).
Good varietal performance ensures continuing growth
The corn business performed very well again in the period under review.
'Above all, good varietal performance was the key to our success,' said
Philip von dem Bussche, Chief Executive Officer of KWS SAAT AG. 'We won
market share, especially in Europe.' One of the contributing factors in
this strong showing was the approximately 20% increase in sales of energy
corn in Germany. KWS generated a total of 17% of its consolidated net sales
from seed for plants that are to be used for producing energy. 'The high
world market prices for sugar stimulated an increase in sugarbeet
cultivation area,' added von dem Bussche. 'Sugarbeet seed business
stabilized in the countries covered by the European Sugar Market Regime and
even picked up significantly outside the EU 27.' Sales of
herbicide-tolerant Roundup Ready(R) sugarbeet in the U.S. also remained
positive. 'The cereals business,' continued von dem Bussche, 'was not able
to match its net sales for the exceptional previous year as a result of low
world market prices at the time of the fall 2009 sowing season. However, it
made a good contribution to our consolidated income.'
Solid financing on the back of an equity ratio of 58 percent
Chief Financial Officer Dr. Hagen Duenbostel explained that the further
expansion of operations had led to a sharp increase in working capital.
Consequently, net cash from operating activities fell from EUR82.0 million
to EUR27.4 million. In order to increase the capacities required and
improve on its high standards of quality in seed production, KWS invested
roughly the same amount in the year under review as in the previous year.
Net cash used in investing activities was EUR55.4 (EUR59.4) million,
resulting in a free cash flow of EUR -28.0 (22.6) million. On the balance
sheet date, cash and cash equivalents were EUR113.7 (125.6) million and,
after deduction of financial borrowings, net liquidity was EUR81.4 (117.0)
million. Equity increased by EUR58.4 million as a result of the strong
profit. The KWS Group remains solidly financed, withan equity ratio
unchanged at 57.5%.
KWS creates new jobs
KWS' good performance is attributable to the achievements of all its
employees in 70 countries. In the year under review, the KWS Group employed
an average of 3,492 (3,215) people, almost 9% more than a year ago. KWS
intends to adapt its structures and administrative processes - particularly
in international business - to support its future growth. 'Central
administrative functions,' said Duenbostel, 'will be pooled at regionally
responsible Service Centers and strengthened to create the capacities
needed for future growth. That will relieve the workload in our core
activities - developing varieties and producing and selling seed. The
objective of this reorganization is to improve the quality of internal
services and secure further growth through cost-effective means.'
Intensive research secures KWS' future
KWS has grown continuously over the past five years. 'The challenge in the
future will be to meet steadily growing demand for agricultural products
despite a constant cultivation area and the increasing impact of diseases
and pests and negative weather influences. We are tackling that by
continuously expanding our research and development activities,' noted von
dem Bussche, pointing to the company's R&D budget of around EUR100 million.
'More than 150 years of experience in breeding plants, our independence as
a medium-sized company with a long tradition of family ownership and a
solid equity base enable us to conduct intensive research at a consistently
high level. As a result, we have managed to double the sugar yield per
hectare to its current level of twelve tons over the past 50 years, for
example. Our objective is to increase this figure to 20 tons by 2020,'
added von dem Bussche.
Outlook: Continued growth and profitability
In the current fiscal year 2010/2011, KWS expects good growth opportunities
in corn and cereals and stable performance in sugarbeet. It plans to grow
net sales in the Corn Segment again by approximately 5%. The weak cereal
harvests in the 2010 growing season have caused a sharp increase in
consumer prices. In view of this fact, KWS anticipates greater demand for
high-quality, certified seed in the current winter cereal sowing season.
KWS aims to retain the Sugarbeet Segment's good level of net sales and
income in the current fiscal year. One key to the segment's performance is
the North American market, where 95% of all sugarbeet farmers already plant
genetically modified, herbicide-tolerant Roundup Ready(R) sugarbeet. As a
result of legal action initiated against the U.S. Department of
Agriculture, permission to sell and produce these special products was
suspended in August 2010. 'The decision is based on a formal defect in the
approval process, and not on safety concerns. It also does not mean a
permanent ban on growing these sugarbeets,' said von dem Bussche. As part
of the reapproval process, the USDA will compile an expanded environmental
impact statement - presumably by mid-2012. The USDA has also announced that
it will grant approvals - subject to conditions - in the meantime so as to
enable commercial growing of Roundup Ready(R) sugarbeet for the coming
season. However, it is likely that the plaintiffs in the original action
will also initiate legal action against these interim approvals.
'Overall, the KWS Group's objective in the current fiscal year is to grow
net sales by about 5% and increase its income proportionately,' concluded
von dem Bussche.
Contact:
Dr. Henning von der Ohe
Phone: +49 (0) 55 61 / 311-245
h.vonderohe(at)kws.com
The 2009/2010 Annual Report can be downloaded as of 7:30 a.m. on October
28, 2010, from http://www.kws.com/ir.
28.10.2010 07:30 Dissemination of a Corporate News, transmitted by DGAP -
a company of EquityStory AG.
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Language: English
Company: KWS SAAT AG
Grimsehlstraße 31
37574 Einbeck
Deutschland
Phone: +49 (0)5561 311-0
Fax: +49 (0)5561 311-322
E-mail: info(at)kws.com
Internet: www.kws.de
ISIN: DE0007074007
WKN: 707400
Indices: S-DAX
Listed: Regulierter Markt in Frankfurt (Prime Standard), Hannover;
Freiverkehr in Hamburg, München, Düsseldorf, Berlin,
Stuttgart
End of Announcement DGAP News-Service
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Datum: 28.10.2010 - 07:30 Uhr
Sprache: Deutsch
News-ID 32429
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Kategorie:
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