AGRANA closes the 2001/02 Financial Year with Outstanding Results

13 June 2002

ACROSS-THE-BOARD GROWTH

Growth

  • of 11 per cent in consolidated revenues to € 842.8 million
  • of 14 per cent in operating profit to € 76.0 million
  • of 18 per cent in consolidated profit for the year to € 44.3 million


As CEO Johann Marihart reported at today’s press conference to present the annual financial statements in Vienna, "The AGRANA Group recorded its highest revenues and profits to date for the 2001/02 financial year (1 March 2001 — 28 February 2002)."

Consolidated revenues were 11 per cent up on the year at € 842.8 million (previous year: € 760.2 million). Two thirds of the increase of € 82.6 million was accounted for by the Austrian members of the group, and one third was generated by AGRANA International companies. The Austrian Sugar Division’s revenues grew by 6.7 per cent, and the Austrian Starch Division achieved an increase of 12.7 per cent. The enlargement of capacities at the Aschach maize starch factory had a particularly positive impact. Sixty-eight per cent of revenues were recorded by Austrian group-members and 32 per cent by companies in Central and Eastern Europe.

Operating profit grew by 14 per cent from € 66.7 million to € 76.0 million, increasing the EBIT margin to 9.0 per cent (previous year: 8.8 per cent). Central and Eastern Europe accounted for 41.4 per cent of operating profit.

Consolidated profit for the year grew by 18 per cent to € 44.3 million (previous year: € 37.6 million). AGRANA’s ROCE increased from 12.8 to 14.8 per cent.

As Marihart said, "Those results were the fruit both of long-term strategic reorientation and short-term measures undertaken to cope with an increasingly difficult economic environment."

Net cash from profit came to € 90.4 million (previous year: € 98.7 million), which was nearly 11 per cent of revenues and thus more than twice investment outlay.

The General Meeting of Shareholders on 12 July 2002 will be asked to approve an increase of € 0.21 in the dividend remittance to shareholders for the 2001/02 financial year, which would thus come to € 1.30 per non-par share. The total distributed on our 11,027,040 non-par unit shares (Stückaktien) would come to € 14.35 million (previous year: € 12.02 million).

The operating environment
We are pleased to be able to report that the EU sugar-market regime was extended by five years to 2006 in May 2002. However, quotas were cut and the storage refund system abolished.

The world market price of sugar stabilized during the financial year under review, but because of a record sugar cane harvest in Brazil, it was in a downtrend at the beginning of this financial year. There are also signs that the US dollar is weakening.

Since last year, there have been tariff-free imports into the EU as a consequence of the Western Balkans agreement and the EBA ("everything but arms") initiative.

Accession negotiations between the EU and countries in Central and Eastern Europe–which are now entering the home straight–should have a sustained beneficial impact on AGRANA’s subsidiaries.

AGRANA International
The closure of the Acs sugar factory in Hungary after the 2001 campaign was the latest major rationalization to be undertaken by Magyar Cukor. Our results during the financial year were very good both in Hungary and in the Czech Republic and Slovakia. Following brand launches in Hungary, the Czech Republic and Romania, we also introduced the Korunny Cukor brand in Slovakia in December 2001.

The Romanian sugar market is still plagued by serious structural problems caused by the inadequacy of the country’s safeguard measures. Higher sugar imports are the result. Romania has been imposing a 30 per cent tariff on imports of unrefined sugar since 1 March 2002. In the autumn of 2001, AGRANA launched the Margaritar Zahar brand in Romania.

The sugar and isoglucose quotas offered to the Czech Republic, Hungary and Slovakia were close to our expectations. As a basis for negotiation, they have created a good medium-term outlook for the CEE strategy initiated by AGRANA in 1990.

We acquired the S.C. A.G.F.D Tandarei S.A. maize starch factory in Romania in November 2002.

The current 2002/03 financial year
The Austrian Sugar Division concluded contracts with 10,000 beet growers for an area of about 44,600 hectares for the 2002 campaign. The beet harvest is expected to be on a par with last year at 2.7 million metric tons.

We concluded contracts for a total of 2.2 million metric tons of sugar beet in Hungary, the Czech Republic, Slovakia and Romania. That is slightly more than we processed last campaign. Planting conditions and the crop’s growth have been in line with the long-term average.

Aggregate sugar sales in Austria during the first two months of the 2002/03 financial year were slightly up on the same period of 2002/01. Sales of household sugar increased somewhat, but sales to the food and beverage industries fell.

In the potato starch segment, we concluded contracts for 214,000 metric tons of starch potatoes in line with our EU potato starch quota. We can report a doubled contract volume in the organic potatoes segment of 6,600 metric tons (previous year: 3,000 metric tons). The segment has grown by an average of 50 per cent per annum in recent years.

Sales by volume and sales by value during the first two months of this financial year were both up on 2001/02.

AGRANA will be investing roughly € 23 million in Austria during the current financial year. The Sugar Division will account for € 14.5 million of that total. Investments will focus primarily on packaging plants, pulp presses, sugar centrifuges and a system for extracting betaine from molasses in Tulln. To obtain betaine, the molasses desaccharification plant in Tulln will be re-equipped to make it possible to break molasses down further into its components and thus to extract enriched betaine alongside the remaining sugar.

The Starch Division will be investing € 8.5 million in the first phase of enlargement at the Aschach maize starch factory, which will increase its daily maize processing throughput to 1,000 metric tons, as well as installing new processing technologies in Aschach and Gmünd.

From 2002, refining of unrefined sugar by AGRANA in Romania will mainly take place in the Buzau sugar factory. As before, the Roman sugar factory will be processing beet. Tandarei will be used as a storage and sales base for sugar and starch. In addition, it will also administer and manage the newly acquired S.C. A.G.F.D. Tandarei S.A. starch factory, which is in the immediate vicinity.

Outlook
This financial year, AGRANA’s trading activities will focus on the more profitable segments, including in particular animal feed. That will slightly reduce revenues, but profits will be at least as high.

AGRANA will do everything it can to continue to build on the results it achieved in the 2001/02 financial year.

We can be contacted at any time by e-mail on info.ab@ Remove this agrana.at.


Key data for the AGRANA Group (applying IAS):

    2001/02 2000/01 1999/2000

CORPORATE DATA

       
Revenues Mio. € 842,8 760,2 703,0
Operating profit Mio. € 76,0 66,7 47,0
Profit before income tax Mio. € 64,1 51,2 28,0
Profit for the year Mio. € 44,3 37,6

22,0

Net cash from profit applying IAS Mio. € 90,4 98,7 58,2
Investments in tangible and intangible non-current assets Mio. € 29,0 38,2 24,4
Staff   4.463 4.753 5.290
EBIT-Margin in % 9,0 8,8 6,7
ROS (Return on Sale) in % 7,6 6,7 4,0
Equity ratio in % 47,7 44,6 41,4


Events, Publications & Dividends Calendar for 2002/03 (provisional)

 

Publication of results for the 2001/02 financial year 13 June 2002
General Meeting of Shareholders 12 July 2002
Dividend ex-day and dividend pay-day 16 July 2002
Publication of results for Q1 2002/03 17 July 2002
Publication of results for H1 2002/03 11 October 2002
Gewinn Fair 17 - 20 October 2002
Publication of results for Q1 — Q3 2002/03/03 16 January 2003