DGAP-News: BayWa AG / Key word(s): Final Results
BayWa AG: Excellent performance in 2010
30.03.2011 / 11:30
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Excellent performance in 2010
BayWa: Renewable Energies' EBIT exceeds expectations. Further growth in
core businesses announced.
Munich, 30 March 2011 - 'An excellent performance over the year, with a
considerable increase of 16 percent in earnings before tax in conjunction
with a very pleasing improvement in the operating results of the business
units', stated Klaus Josef Lutz, Chief Executive Officer of BayWa AG, in
presenting the results for financial year 2010. Lutz is optimistic about
the current year and predicts further growth in the company's core
businesses.
The international trading group closed the financial year with earnings
before interest and tax (EBIT) of EUR 128.9 million (2009: EUR 115.4
million) on the back of revenues which came to EUR 7.9 billion (2009: EUR
7.3 billion). EBIT was therefore raised by 11.7 percent measured against
the year 2009, and revenues climbed by 8.9 percent. To enable shareholders
to participate in BayWa's successful performance, a proposal to raise
dividend by 25 percent to 50 cents per share as against the previous year
will be put to the Annual General Meeting of Shareholders.
The financial year ended was influenced mainly by the economic upswing
which benefited BayWa in all its segments. Farmers were encouraged by the
increase in the prices of grain and milk to invest more, which resulted in
a positive impact on the demand for fertilisers and crop protection and
orders placed for agricultural equipment. All in all, this development in
business led to a significant increase in operating profit as compared with
2009. 'We have therefore achieved an important goal in 2010', was Lutz's
pleased comment. Another significant goal was achieved in the renewable
energies business: The EBIT target of EUR 20 million was even slightly
exceeded, with EBIT posting EUR 21.1 million (2009: EUR 1.8 million).
Lutz announced that BayWa intends to promote growth in its core segments
measured by revenues and profit. The Chief Executive Officer also sees
potential for raising operativ result and cited the Building Materials
segment as the only segment which has not yet been able to earn its cost of
capital. Here BayWa is working on strategic prospects which, however,
excludes the option of a complete sale. More investments aimed at
strengthening the core business and raising profit in the Agriculture
Segment have been planned. Investments will, for instance, include
committing funds of EUR 20 million to expand the location in Regensburg's
harbour.
In the renewable energies business, Lutz anticipates another above-average
growth and rising contributions to profit. This will be achieved partly by
acquisitions and partly by organic growth in the holdings acquired. He
assumes that renewable energies will become even more important against the
backdrop of events in Japan.
Agriculture segment characterised by stronger demand and higher prices
The Group's Agriculture Segment generated revenues of EUR 3.5 billion in
2010 (2009: EUR 3.3 billion), thereby contributing 44 percent to
consolidated revenues. There was a significant increase in EBIT which
climbed to EUR 63.9 million (2009: EUR 44.2 million).
The Agricultural Trade business unit, with its focus on agricultural
produce and operating resources, lifted revenues to EUR 2.5 billion (2009:
EUR 2.4 billion). This revenue growth of around 7 percent is mainly price
induced: mid-2010 saw the price of grain rise steeply owing to widespread
drought in Europe and Russia during the main growth phase. The poor weather
conditions during the harvest in late summer and early autumn resulted in
more crop shortfalls which, on occasion, drove the prices of grain by up to
80 percent above the previous year's level. Prices remained at a higher
level than in 2009 throughout the whole second half of the year, to the
benefit of farmers, and more than compensated for the lower harvest yield.
This development also impacted BayWa's business as farmers pared down their
grain stocks with the result that grain turnover at BayWa climbed by almost
4 percent to 5 million tons. At the same time, demand for fertilisers and
crop protection gained momentum despite rising prices.
The fruit trading business, comprised under the Agriculture segment, had a
favourable impact on revenues and profit. The BayWa Group is a leading
supplier of German dessert fruit to food retailers and the largest supplier
of pipfruit from organic production. Together with Frucom, a company
acquired in 2010 trading in tropical fruit, the business unit raised its
EBIT to EUR 3.7 million (2009: EUR 3.2 million). Despite the lower harvest
volume, revenues increased to EUR 102.8 million (2009: EUR 83.3 million)
owing first and foremost to higher prices and through the inclusion of the
large fruit and vegetable markets acquired in 2009 in Ingelheim and
Weisenheim.
The Agricultural Equipment business unit achieved revenues of EUR 873.3
million (2009: EUR 826.6 million) and an EBIT of EUR 10.8 million (2009:
EUR 13.0 million) in 2010. The growth in revenues is mainly attributable to
expanding the Claas agencies in Lower Bavaria and in the southern part of
Upper Bavaria, as well as the successful placement in the market of BayWa's
own tecparts brand for second-hand machinery. Services and maintenance also
recorded growth. The demand for agricultural machinery and equipment for
yard and barn picked up momentum in the second half of the year from the
growing improvement in farmers' income. Lower EBIT as against the previous
year is primarily the result of the higher level of expenses incurred by
converting locations for the Claas and AGCO/Fendt brands.
Based on the data available, BayWa anticipates that the willingness of the
Agriculture Segment's customers to invest will continue to develop well in
2011, and expects an increase in profit.
Building Materials Segment achieves revenue growth
The revenues of the Building Materials Segment came to around EUR 1.9
billion (2009: EUR 1.8 billion). EBIT stood at EUR 18.3 million (2009: EUR
24.2 million).
The main influences on the Segment's financial year were the severe winter
with slow demand, followed by business gaining momentum over the course of
the year. The Building Materials business unit benefited both from the
German government's economic stimulus programmes and from the recovery in
housing construction. For the first time after a decade, housing
construction in Germany recorded an increase again of 4.4 percent. The
business unit generated revenues of EUR 1.4 billion (2009: EUR 1.3
billion). Fierce competition and strong pressure on margins caused the
Building Materials business unit's EBIT, which came to EUR 8.5 million
(2009: EUR 12.8 million), to fall short of expectations.
The DIY & Garden Centres business unit benefited not only from the improved
economic climate but also to a great extent from the new product mix and
the continued implementation of the specialist store concept. Revenues
climbed to EUR 5.2 million (2009: EUR 4.9 million). EBIT fell to EUR 9.8
million (2009: EUR 11.4 million) mainly due to the higher level of
depreciation and amortisation which came to EUR 1 million for investments
for converting and refurbishing centres in the previous years. Klaus Josef
Lutz underscored the fact that, in 2011, all efforts would be undertaken in
the Building Materials Segment to significantly raise the operating result.
'We continue to work on the strategic prospects of the Segment which is
exposed to harsh competition and low margins', stated Lutz.
Energy Segment delivers greater profitability at BayWa r.e
The Energy Segment achieved an increase in revenues of almost 30 percent to
EUR 2.4 billion in 2010 (2009: EUR 1.8 billion). EBIT soared by more than
70 percent to EUR 30.3 million (2009: EUR 17.7 million).
This positive development was due first and foremost to BayWa r.e GmbH
which comprises all the renewable energies activities of BayWa. The company
generated revenues of around EUR 255 million and, in its first full year
within the Group, delivered an EBIT of more than EUR 21 million which
outperformed expectations. 'This is proof that the strategy of investing in
this sector was absolutely right and has paid off', was Klaus Josef Lutz's
pleased comment.
The Segment's conventional energy business also performed well in 2010: The
demand for lubricants and fuels picked up momentum, buoyed by the economic
environment, and resulted in a substantial increase in sales. Only the sale
of heating oil declined due to the relatively high price level and hesitant
demand by customers despite the cold winter and the increasingly lower
filling levels of heating oil tanks. All in all, margins developed well not
only in the heating market and the filling station business but also in the
lubricants business which improved its operating result.
'We intend to grow in both our conventional energy business and in the
field of renewable energies', was Lutz's affirmation of BayWa's strategy.
'We will achieve this through acquisitions on the one hand, and through
organic growth on the other, as the shareholdings acquired will also expand
their businesses in their own right', commented the Chief Executive
Officer.
'Other Activities' in 2010
In the financial year 2010, 'Other Activities' generated revenues of EUR
136.3 million (2009: EUR 376.9 million). The decline was due in the main to
the disposal of BayWa's car dealer activities in 2009 and the sale of other
shareholdings as part of BayWa's focusing on its core businesses. At the
end of the year, BayWa's 'Other Activities' comprised the Austrian food
producer Ybbstaler and a number of financial investments which, from the
standpoint of the Group, are of secondary importance. Pending approval by
the anti-trust authorities, Ybbstaler Fruit Austria GmbH will be combined
with AGRANA Juice Holding GmbH as part of a joint venture and no longer be
included in the Group's balance sheet.
Contact:
Marion Danneboom, BayWa AG, Head of PR/Corporate Communication,
tel. +49 (0)89/92 22-36 80, Fax +49 (0)89/92 22-36 98,
e-mail: marion.danneboom@baywa.de
End of Corporate News
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Language: English
Company: BayWa AG
ArabellastraÃe 4
81925 München
Deutschland
Phone: 089/ 9222-3691
Fax: 089/ 9222-3698
E-mail: presse@baywa.de
Internet: www.baywa.de
ISIN: DE0005194062, DE0005194005,
WKN: 519406, 519400,
Listed: Regulierter Markt in Frankfurt (Prime Standard), München;
Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover,
Stuttgart
End of News DGAP News-Service
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117516 30.03.2011
DGAP-News: BayWa AG: Excellent performance in 2010
| Source: EQS Group AG