Our performance in the first half of the fiscal year displayed notable divergences in various aspects of our business. While we observed favorable developments in the European winter crops segment, indicating a promising start to the sugarbeet season, our corn business experienced a significant decline. Additionally, adverse currency effects had a detrimental impact on our overall earnings,” stated Eva Kienle, Chief Financial Officer of KWS. “Despite these challenges, including persistent economic uncertainties, we maintain optimism for the upcoming spring sowing season and uphold our full-year forecasts.”
Business Highlights for H1 2023/2024:
- The KWS Group’s revenue decreased by 8.0% during the first six months of the fiscal year to €518.6 million, primarily due to negative currency effects, notably affecting the Argentinean peso and Eastern European currencies. Excluding currency effects, comparable growth stood at +0.6%.
- EBITDA and EBIT declined to €–45.1 million and €–96.4 million, respectively. Planned cost increases and effects from the devaluation of the Argentinean peso contributed to this decline, offsetting positive contributions from the divestment of the Chinese corn portfolio.
- Net financial income/expenses decreased to €–54.8 million, with income taxes amounting to –€42.3 million, resulting in a profit after tax of –€108.8 million (€–3.30 per share). Free cash flow declined slightly to €–179.9 million due to earnings development and the build-up of working capital for planned business expansion.
Segment-wise Business Performance:
- The Corn Segment experienced a notable decline in net sales to €191.2 million, primarily attributed to delayed corn growing seasons, lower area cultivation, and currency devaluation effects. Despite customary negative earnings for the period, the segment’s income dropped to €–100.1 million.
- Net sales in the Sugarbeet Segment surged to €119.8 million, driven by early seed purchases in European markets. Although customary negative income was observed in the first half, it improved to €–21.8 million.
- The Cereals Segment saw a significant 7% rise in net sales to €222.6 million, mainly due to strong growth in rye, oilseed rape, and wheat seed. With an improved product mix, the segment’s income rose to €87.5 million.
- Net sales in the Vegetables Segment decreased by approximately 14% to €24.6 million, mainly due to reduced sales in China and North America. The segment’s income declined to €–16.1 million due to increased planned expenditure.
- Net sales in the Corporate Segment remained stable at €4.1 million, with income declining to €–72.2 million, primarily due to expanded central R&D activities and higher administrative expenses.
Overall, while facing challenges in certain segments, KWS remains optimistic about future prospects and maintains its strategic forecasts for the fiscal year.
