Corporate | 26 February 2009 08:52
KWS SAAT AG / Half Year Results/Half Year Results Release of a Corporate News, transmitted by DGAP - a company of EquityStory AG. The issuer / publisher is solely responsible for the content of this announcement. ---------------------------------------------------------------------- KWS SAAT AG continues its growth in the first half of 2008/2009 A 10% increase in net sales and operating income on a par with the previous year are expected in fiscal 2008/2009 (July 1, 2008 - June 30, 2009) (Einbeck, February 26, 2009/No.5/gf) - KWS SAAT AG (ISIN: DE 0007074007), one of the leading international seed companies, increased its consolidated net sales in the first half of fiscal 2008/2009 (which ends on June 30) by almost 30 percent to EUR141.8 (110.3)* million. The sales of cereals seed developed particularly well. 'The hybrid rye business of KWS LOCHOW again drove growth,' said Hagen Duenbostel, CFO of KWS SAAT AG, about the Group's performance. 'Our winter rapeseed varieties also showed increases in net sales.' Sales revenue from the new potato joint venture Van Rijn - KWS B.V. is included in the KWS Group for the first time. KWS' seed business is characterized by seasonal fluctuations. While costs are spread relatively evenly over the year, most sales are generated in the third quarter. The crops that account for by far the largest net sales - corn and sugarbeet - are not sown until the spring season. Seen as an average over many years, KWS generates just under 20 percent of its annual revenue in the months July to December. As a result, income for the first half of the year is typically negative, and KWS does not pass the break-even point until the third quarter. In the first six months of 2008/2009, KWS improved its operating income (EBIT) by EUR5.7 million to EUR -39.9 (-45.6) million. Finance income/expenses fell to EUR -2.1 (+4.8) million, since the figure for the same period of the previous year was boosted by the profit from the sale of its former potato activities. Net income for the period was EUR -30.2 (-25.1) million. High-yielding hybrid varieties post gratifying increase in sales and profits Net sales in the cereals segment grew by 35% to EUR74.2 (54.8) million in the first half of the year, in which demand is mainly for winter cereals and rapeseed. The corn segment (including oil seed) recorded just above a 20% increase in net sales to EUR37.7 (30.5) million. Since the main sales season for corn begins in the third quarter, 40 percent of net sales in this segment were generated by winter rapeseed. 'The slight decline in cultivation area was more than compensated for by additional revenue from high-yielding hybrid varieties, which now account for more than half of rapeseed sales,' said Duenbostel. Net sales of EUR20.2 (21.4) million were achieved in sugarbeet seed business. Net sales at the breeding & services segment increased in the first six months to EUR9.7 (3.6) million. The figure includes not only farm revenues, but also net sales from the seed potato joint venture for the first time. However, the main business for the new potato activities does not begin until spring. Capital expenditure well above depreciation In order to strengthen its leading market position, the KWS Group has significantly increased its workforce to 3,147 (2,760). Research and development activities at the Einbeck location also benefited from this increase. In the first six months, KWS * The figures in parentheses are those for the previous year invested EUR14.3 (14.8) million in property, plant and equipment, mainly in the corn segment, where new drying, processing and storage capacities were created in Romania, Ukraine, Turkey and the U.S. As a result, capital expenditure was again well above depreciation of EUR7.7 (7.2) million. Forecast for the year as a whole confirmed KWS' Executive Board confirms its net sales and earnings forecasts for the whole of fiscal 2008/2009 on the basis of current planning. Net sales are expected to grow by 10%, and the Group will likely be able to maintain the previous year's income, despite higher costs. Now that the radical changes brought about by reform of the European Sugar Market Regime are largely complete, we expect business at the sugarbeet segment to increase slightly. However, its income will be strained by negative currency effects and possible allowances for receivables. Given the positive course of business, we expect the cereals segment to increase its net sales by around 20% and improve its income by some 35%. Despite greater expenditure for research and breeding, income at the breeding & services segment will develop positively as a result of royalties. Overall, we expect to surpass the previous year's net sales (EUR599.1 million) by approximately 10%. We are confident that operating income will be on a par with the excellent mark of the previous year (EUR70.1 million). The individual product segments:In million EUR (at December 31) H1 2008/2009 H1 previous year Consolidated net sales 141.8 110.3 Sugarbeet 20.2 21.4 Corn 37.7 30.5 Cereals 74.2 54.8 Breeding & services 9.7 3.6 Operating income -39.9 -45.6 Net income for the period -30.2 -25.1The semiannual report can also be obtained at www.kws.de/ir. Contact: Georg Folttmann Phone: +49 (0) 55 61 / 311-640 g.folttmann@kws.com 26.02.2009 Financial News transmitted by DGAP ---------------------------------------------------------------------- Language: English Issuer: KWS SAAT AG Grimsehlstraße 31 37574 Einbeck Deutschland Phone: +49 (0)5561 311-0 Fax: +49 (0)5561 311-322 E-mail: info@kws.com Internet: www.kws.de ISIN: DE0007074007 WKN: 707400 Indices: S-DAX Listed: Regulierter Markt in Frankfurt (Prime Standard), Hannover; Freiverkehr in Berlin, Hamburg, Düsseldorf, München, Stuttgart End of News DGAP News-Service ---------------------------------------------------------------------------