In a continuing volatile business environment, we were able to record an operating profit (EBIT) of € 151.0 million (prior year: € 88.3 million1). We thus delivered on our guidance of very significantly higher earnings than in the prior year.
AGRANA has adjusted well to the new market dynamics, especially where raw material and energy prices are concerned, and the operating performance was improved in very many business areas.
In the Fruit segment, our fruit preparations business has been back on course since the beginning of the financial year, including also achieving a good business trajectory in the food service product area. The operating profit situation in the fruit juice concentrate business before exceptional items also remains very satisfactory. A downside factor is the continuing difficult business trend in Asia, which gave rise to an asset impairment charge of about € 18.7 million in the Fruit segment as a whole.
In the Starch segment, despite the economic weakness that led to a significant decline in sales volumes, the margin in starch and saccharification products was held nearly constant on balance. However, due to the significant fall in Platts prices, the bottom-line performance in the ethanol operations was much weaker than in the year before. A mainly utilisation-related significantly poorer showing of the HUNGRANA group led to a significant overall decline in Starch segment EBIT.
In the Sugar segment, beet processing in the 2023 campaign went well, with significantly better capacity utilisation and a higher sugar production volume than in the previous year. The sugar business in the summer was satisfactory, despite rising imports from Ukraine, and was marked by strong demand from the beverage industry that had a positive impact on our inventory management. In terms of sales, the duty-free or preferential sugar imports from Ukraine will remain a challenge for AGRANA, at least in the short term. As regards AGRANA’s raw material supply, a further increase in beet planting acreage was achieved in the negotiations with growers for the contract production of beet in 2024. As a result of a significant reduction in the earnings contribution of the equity-accounted AGRANA-STUDEN group, EBIT in the Sugar segment was below the good level of the prior year.
Key risk factors (including financial ones) for the new, 2024|25 financial year currently remain difficult to assess. Two examples are the uncertainty regarding Ukrainian sugar imports and the high volatility in ethanol prices. As we have been seeing an increasingly challenging business environment since the fourth quarter of 2023|24 that we expect to continue, our forecast for 2024|25 calls for a Group EBIT result significantly below that of 2023|242. Amid the increased cost of capital, the Group will maintain its focus on capital efficiency and working capital management. On the equity side and in terms of overall financing, AGRANA’s position is sound and flexible.
In line with our focus on long-term profitable growth and our commitment to dividend continuity, we wish to pay you, our esteemed shareholders, a solid dividend for the 2023|24 financial year.
We would like to close by thanking our partners, customers, suppliers, employees and all other stakeholders for the valued collaboration and relationships. A special thank-you again goes to our colleagues in Ukraine for their continuing extraordinary efforts and dedication during the ongoing war.
The Management Board of AGRANA Beteiligungs-AG
1 EBIT in the prior financial year (2022|23) included an impairment charge of € 91.1 million on assets and goodwill in the Fruit segment.
2 Also see the Outlook section in the full version of the annual report (including disclaimer).