ForFarmers N.V.: ForFarmers 2021 first-half resultsSource: OMX
Lochem, 13 August 2021
ForFarmers 2021 first-half results
Financial highlights for first-half of 20211:
• Total Feed Volume2: +1.9% to 4.9 million tonnes; acquisition effect outweighs slight like-for-like (l-f-l) decline
of which compound feed: +2.2% to 3.5 million tonnes; growth (l-f-l) in cluster Germany/Poland and acquisition effect compensates for decline (l-f-l) in cluster Netherlands/Belgium and United Kingdom
• Gross profit: -0.9% to €217.5 million as a result of increased competition due to Covid and volume decline (l-f-l)
• Underlying EBITDA: -15.4% to €40.8 million despite contribution from acquisitions due to lower gross profit and higher energy and fuel costs; no currency translation effect
• Underlying net profit3: -26.6% to €17.9 million
• Working capital: (year-on-year) improvement by €23.2 million to €53.3 million
• Cash flow from operating activities: -35.9% to €9.1 million; driven by lower EBITDA
Commenting on the 2021 first-half results, ForFarmers CEO Yoram Knoop said: “The results in the first-half of 2021 were disappointing. There was an abnormally fierce battle for market share between feed producers, resulting in margin pressure. This was mainly attributable to the generally dire liquidity situation of our customers. The prolonged Covid measures delayed price recovery for their products, whilst at the same time feed prices rose as a result of the sharp increase in raw material prices. In addition, we lost around €4 million in our underlying EBITDA due to the incident in Germany where we had priced a number of contracts wrongly, as reported in our Q1 trading update. Our volumes increased as a result of the acquisition of De Hoop Mengvoeders and Mühldorfer Pferdefutter, both at the beginning of this year. Like-for-like, we saw volumes decline just a little. In the first half of this year we realised savings, as part of the efficiency programme to save a total of €7 million during this and the coming year. Mainly due to margin pressure and the incident in Germany we realised a lower underlying EBITDA than a year earlier. How long the current margin pressure will continue, largely depends on the diligence of the sector in fully passing on the rapidly increased costs of mainly raw materials and energy, to customers. Against this backdrop, we expect the underlying EBITDA in the second half-year 2021 (including acquisitions) to be more or less in line with the underlying EBITDA in 2H 2020.
The integration of the two acquisitions is progressing according to plan and the results achieved so far have been better than expected. Within ForFarmers we focus foremost on increasing our market share by delivering good products and advice for a fair price, enabling both our customers and ourselves to increase returns. We aim to do this more efficiently all the time. We are due to launch innovations, which will enhance our customer proposition. Our sector has great innovative strength and at present this is crucial in the Netherlands in particular, given that it provides the solution to the nitrogen crisis. By making it possible for the sector to innovate in terms of feed concepts and barn facilities, it is no longer necessary to focus on reducing livestock numbers in order to restore nature and kick-start the construction sector. It is by preserving – and not destroying – our world-leading sector, in terms of high-quality production with an ever lower environmental footprint, that we can contribute to greater global sustainability. Finally, I am pleased that the Supervisory Board nominated our colleague Pieter Wolleswinkel as a member of the Executive Board this morning.”
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Note to the editor / For additional information:
Caroline Vogelzang, Director Investor Relations
T +31 (0)573 288 194 • M +31 (0)6 10 94 91 61 • E: email@example.com
ForFarmers N.V. is an international organisation that offers complete and innovative feed solutions for livestock farming. With its “For the Future of Farming” mission, ForFarmers is committed to the continuity of farming and further sustainalising the agricultural sector.
ForFarmers is the market leader in Europe with annual sales of 10.1 million tonnes of animal feed. The company is operating in the Netherlands, Germany, Belgium, Poland and the United Kingdom. ForFarmers has approximately 2,600 employees. In 2019, the turnover amounted to approximately € 2.5 billion.
ForFarmers N.V. is listed on Euronext Amsterdam.
This document contains forward-looking statements that can also relate to ForFarmers’ legally required capital and liquidity positions in certain specific scenarios. Forward-looking statements can include but are not limited to statements that include words such as, “intended”, “expected”, “based on”, “focused on”, “plans”, “estimate” and words with similar meanings. These statements relate to or can have an effect on circumstances that will occur in the future, such as ForFarmers’ future financial results, business plans and current strategies. Forward-looking statements are subject to various risks and uncertainties that could cause actual results and performance to differ materially from the expected future results or performances that are implicitly or explicitly included in forward-looking statements. Factors that can lead to or contribute to differences in current expectations include, but are not limited to: developments in legislation, technology, taxes, laws and regulations, fluctuations in share prices, legal procedures, investigations by regulators, competitive relationships and general economic conditions. These and other factors, risks and uncertainties that may affect any forward-looking statement or the actual results of ForFarmers are discussed in the latest published annual report. The forward-looking statements in this document only concern statements from the date of this document, ForFarmers accepts no obligation or responsibility whatsoever to update forward-looking statements contained in this message, irrespective of whether they reflect new information, future events or otherwise, subject to ForFarmers’ legal obligation to do so.
1 Results are always compared year-on-year
2 Total Feed : the entire product portfolio, comprising compound feed, specialties, co-products (including DML products), seeds and other products (such as forage)
3 Underlying net profit: in this instance profit attributable to shareholders of the Company