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| €000 | 2019|20 | 2018|19 | Change absolute | Change % |
|---|---|---|---|---|
| Revenue | 2,480,732 | 2,443,048 | 37,684 | 1.5% |
| Changes in inventories of finished and unfinished goods | 64,764 | -53,505 | 118,269 | 221.0% |
| Own work capitalised | 1,898 | 1,120 | 778 | 69.5% |
| Other operating income | 37,671 | 32,980 | 4,691 | 14.2% |
| Cost of materials | -1,759,277 | -1,647,491 | -111,786 | -6.8% |
| Staff costs | -341,660 | -323,717 | -17,943 | -5.5% |
| Depreciation, amortisation and impairment losses | -110,333 | -96,636 | -13,697 | -14.2% |
| Other operating expenses | -303,472 | -301,403 | -2,069 | -0.7% |
| Share of results of equity-accounted joint ventures | 16,727 | 12,222 | 4,505 | 36.9% |
| Operating profit [EBIT] | 87,050 | 66,618 | 20,432 | 30.7% |
| Finance income | 22,851 | 25,464 | -2,613 | -10.3% |
| Finance expense | -40,042 | -40,836 | 794 | 1.9% |
| Net financial items | -17,191 | -15,372 | -1,819 | -11.8% |
| Profit before tax | 69,859 | 51,246 | 18,613 | 36.3% |
| Income tax expense | -18,567 | -20,860 | 2,293 | 11.0% |
| Profit for the period | 51,292 | 30,386 | 20,906 | 68.8% |
| - Attributable to shareholders of the parent | 48,162 | 25,406 | 22,756 | 89.6% |
| - Attributable to non-controlling interests | 3,130 | 4,980 | -1,850 | -37.1% |
| Earnings per share under IFRS (€) (basic and diluted) | 0.77 | 0.41 | 0.36 | 87.8% |
The AGRANA Group’s revenue of € 2,480.7 million in the 2019|20 financial year marked a slight increase from the prior year. Revenue was steady in the Fruit segment (at € 1,185.4 million, up 0.5%), eased in the Sugar segment (at € 488.3 million, down 2.6%) and grew in the Starch segment (at € 807.0 million, up 5.8%).
Operating profit (EBIT) was € 87.1 million in 2019|20, a significant increase of 30.8% from the prior year. In the Fruit segment, EBIT decreased to € 55.9 million, a reduction of 27.7% driven primarily by a lower result in the fruit preparations business. In the Sugar segment, higher sugar sales prices than in the prior year led to an EBIT improvement, although in absolute terms, EBIT remained significantly negative at a deficit of € 44.0 million. The Starch segment expanded its EBIT substantially by 46.9% to € 75.2 million. Details on the share of results of equity-accounted joint ventures and on exceptional items can be found in the segment reports and the consolidated financial statements.
Net financial items in 2019|20 amounted to a net expense of € 17.2 million (prior year: net expense of € 15.4 million). The increase of € 2.9 million in net interest expense was attributable to an average increase of € 150 million in debt and the additional interest expense of about € 1.0 million resulting from the initial application of IFRS 16, Leases. At the same time, currency translation differences improved by € 1.4 million. In the prior year this item had included a high forex expense due to the depreciation of the Argentine peso, while in 2019|20 this effect was avoided thanks to the debt reduction of the Argentine subsidiary. The change in other financial items (down € 0.3 million) resulted from the issue of the Schuldscheindarlehen by AGRANA Beteiligungs-AG in August 2019 and the renewal of a syndicated credit line by AUSTRIA JUICE GmbH.
Profit before tax increased from the prior year’s € 51.2 million to € 69.9 million. After an income tax expense of € 18.6 million based on a tax rate of 26.6% (prior year: 40.7%), the Group’s profit for the period was € 51.3 million (prior year: € 30.4 million). Profit for the period attributable to shareholders of AGRANA was € 48.2 million (prior year: € 25.4 million); earnings per share increased to € 0.77 (prior year: € 0.41).
| €000 | 29 February 2020 | 28 February 2019 | Change absolute | Change % |
|---|---|---|---|---|
Assets |
||||
| A. Non-current assets | ||||
| Intangible assets | 275,108 | 276,740 | -1,632 | -0.6% |
| Property, plant and equipment | 932,795 | 864,221 | 68,574 | 7.9% |
| Equity-accounted joint ventures | 76,919 | 69,926 | 6,993 | 10.0% |
| Securities | 19,599 | 18,843 | 756 | 4.0% |
| Investments in non-consolidated subsidiaries and outside companies | 919 | 19 | 900 | 4,736.8% |
| Other assets | 12,410 | 10,090 | 2,320 | 23.0% |
| Deferred tax assets | 14,175 | 12,309 | 1,866 | 15.2% |
| 1,331,925 | 1,252,148 | 79,777 | 6.4% | |
| B. Current assets | ||||
| Inventories | 710,500 | 619,133 | 91,367 | 14.8% |
| Trade receivables | 319,457 | 321,694 | -2,237 | -0.7% |
| Other assets | 89,334 | 107,790 | -18,456 | -17.1% |
| Current tax assets | 4,813 | 6,060 | -1,247 | -20.6% |
| Cash and cash equivalents | 93,415 | 82,582 | 10,833 | 13.1% |
| 1,217,519 | 1,137,259 | 80,260 | 7.1% | |
| Total assets | 2,549,444 | 2,389,407 | 160,037 | 6.7% |
Equity and liabilities |
||||
| A. Equity | ||||
| Share capital | 113,531 | 113,531 | 0 | 0.0% |
| Share premium and other capital reserves | 540,760 | 540,760 | 0 | 0.0% |
| Retained earnings | 669,406 | 694,451 | -25,045 | -3.6% |
| Equity attributable to shareholders of the parent | 1,323,697 | 1,348,742 | -25,045 | -1.9% |
| Non-controlling interests | 63,435 | 61,186 | 2,249 | 3.7% |
| 1,387,132 | 1,409,928 | -22,796 | -1.6% | |
| B. Non-current liabilities | ||||
| Retirement and termination benefit obligations | 73,401 | 71,177 | 2,224 | 3.1% |
| Other provisions | 29,756 | 23,505 | 6,251 | 26.6% |
| Borrowings | 450,212 | 278,988 | 171,224 | 61.4% |
| Other payables | 6,418 | 12,820 | -6,402 | -49.9% |
| Deferred tax liabilities | 5,504 | 6,556 | -1,052 | -16.0% |
| 565,291 | 393,046 | 172,245 | 43.8% | |
| C. Current liabilities | ||||
| Other provisions | 20,789 | 31,221 | -10,432 | -33.4% |
| Borrowings | 126,814 | 144,639 | -17,825 | -12.3% |
| Trade payables | 311,771 | 292,914 | 18,857 | 6.4% |
| Other payables | 131,553 | 110,713 | 20,840 | 18.8% |
| Tax liabilities | 6,094 | 6,946 | -852 | -12.3% |
| 597,021 | 586,433 | 10,588 | 1.8% | |
| Total equity and liabilities | 2,549,444 | 2,389,407 | 160,037 | 6.7% |
Total assets at 29 February 2020 were € 2,549.4 million, an increase of € 160.0 million from the year-earlier level.
Non-current assets increased by € 79.8 million, due mainly to the initial application of IFRS 16, Leases, and also reflecting a level of investment that exceeded depreciation. Inventories rose significantly for price and volume reasons. In combination with a rise in cash and cash equivalents, this led to an overall increase in current assets.
AGRANA’s equity ratio of 54.4% was 4.6 percentage points below that of one year earlier. On the other side of the balance sheet, non-current liabilities rose significantly, due primarily to an increase in long-term borrowings. Current liabilities increased slightly, which was attributable to a rise in trade payables and in other payables.
| €000 | 2019|20 | 2018|19 | Change absolute | Change % |
|---|---|---|---|---|
| Profit for the period | 51,292 | 30,386 | 20,906 | 68.8% |
| Depreciation, amortisation and impairment of non-current assets | 110,362 | 96,636 | 13,726 | 14.2% |
| Reversal of impairment losses on non-current assets | -28 | 0 | -28 | |
| (Gains) on disposal of non-current assets | -1 | -194 | 193 | 99.5% |
| Changes in non-current provisions | 2,303 | 342 | 1,961 | 573.4% |
| Share of results of equity-accounted joint ventures | -16,727 | -12,222 | -4,505 | -36.9% |
| Dividends received from equity-accounted joint ventures | 14,000 | 15,000 | -1,000 | -6.7% |
| Loss on net monetary position under IAS 29 | 912 | 1,302 | -390 | -30.0% |
| Non-cash expenses/income and other adjustments | 25,718 | 46,296 | -20,578 | -44.4% |
| Operating cash flow before changes in working capital | 187,831 | 177,546 | 10,285 | 5.8% |
| Changes in inventories | -102,588 | 19,589 | -122,177 | -623.7% |
| Changes in receivables and current assets | -296 | -14,326 | 14,030 | 97.9% |
| Changes in current provisions | -16,548 | 2,065 | -18,613 | -901.4% |
| Changes in payables (excluding borrowings) | 66,450 | -13,200 | 79,650 | 603.4% |
| Changes in working capital | -52,982 | -5,872 | -47,110 | -802.3% |
| Interest received | 2,001 | 3,250 | -1,249 | -38.4% |
| Interest paid | -8,814 | -7,193 | -1,621 | -22.5% |
| Tax paid | -17,940 | -26,022 | 8,082 | 31.1% |
| Net cash from operating activities | 110,096 | 141,709 | -31,613 | -22.3% |
| Dividends received | 17 | 24 | -7 | -29.2% |
| Proceeds from disposal of non-current assets | 1,971 | 3,241 | -1,270 | -39.2% |
| Purchases of property, plant and equipment and intangible assets, net of government grants | -150,030 | -161,190 | 11,160 | 6.9% |
| Proceeds from disposal of securities | 6 | 1,374 | -1,368 | -99.6% |
| Proceeds from disposal of subsidiaries, net of cash | 582 | 0 | ||
| Purchases of non-current financial assets | -8,124 | 0 | -8,124 | |
| Purchase of subsidiaries, net of cash acquired | 0 | -5,336 | 5,336 | 100.0% |
| Net cash (used in) investing activities | -155,578 | -161,887 | 6,309 | 3.9% |
| Repayment of borrowings to affiliated companies in the Südzucker group | -85,000 | -65,000 | -20,000 | -30.8% |
| Repayment of Schuldscheindarlehen, or bonded loan | 164,500 | 0 | 164,500 | |
| (Outflows) from lease liabilities | -6,437 | 0 | -6,437 | |
| Repayment of investment loan of the European Investment Bank | -4,882 | 0 | -4,882 | |
| Proceeds from non-current loans | 0 | 40,000 | -40,000 | -100.0% |
| Proceeds from syndicated loans | 10,000 | 75,000 | -65,000 | -86.7% |
| Inflows/(outflows) from bank overdrafts and cash advances | 42,344 | 1,219 | 41,125 | 3,373.7% |
| Proceeds from ceding of shares of subsidiary without loss of control | 0 | 2,475 | -2,475 | -100.0% |
| Purchase of non-controlling interests | 0 | -411 | 411 | 100.0% |
| Dividends paid | -63,203 | -71,463 | 8,260 | 11.6% |
| Net cash from/(used in) financing activities | 57,322 | -18,180 | 75,502 | 415.3% |
| Net increase/(decrease) in cash and cash equivalents | 11,840 | -38,358 | 50,198 | 130.9% |
| Effect of movements in foreign exchange rates on cash and cash equivalents | -511 | -577 | 66 | 11.4% |
| Cash acquired in initial consolidation of subsidiaries | 0 | 637 | -637 | -100.0% |
| Effect of IAS 29 on cash and cash equivalents | -496 | -81 | -415 | -512.3% |
| Cash and cash equivalents at beginning of period | 82,582 | 120,961 | -38,379 | -31.7% |
| Cash and cash equivalents at end of period | 93,415 | 82,582 | 10,833 | 13.1% |
Operating cash flow before changes in working capital was up € 10.3 million year-on-year at a new total of € 187.8 million. After an inventory-driven significantly larger increase of € 53.0 million in working capital than a year ago (prior year: increase of € 5.9 million), net cash from operating activities decreased to € 110.1 million (prior year: € 141.7 million). Net cash used in investing activities was € 155.6 million, a decrease from the prior year as a result of lower outflows for purchases of property, plant and equipment and intangibles (prior year: net cash use of € 161.9 million). In 2019|20, an overall increase in borrowings (on a net basis across the current and non-current portions) and a lower dividend payment led to net cash from financing activities of € 57.3 million (prior year: net cash use of € 18.2 million). Free cash flow in the year under review decreased by more than 100% year-on-year.
Net debt as of 29 February 2020 amounted to € 464.0 million, up € 141.8 million from the 2018|19 year-end level. The gearing ratio was thus 33.5% at the balance sheet date (28 February 2019: 22.9%).
To strengthen the long-term funding base and take advantage of the historic low interest rate environment, AGRANA Beteiligungs-AG at 1 August 2019 placed a € 200 million Schuldscheindarlehen (bonded loan) in tranches of five, seven and ten years. The weighted average term to maturity is six years. Approximately 75% of the Schuldscheindarlehen carries a fixed interest rate. As well, in November 2019, AGRANA Beteiligungs-AG raised a long-term bank loan with a seven-year term. Both the Schuldscheindarlehen and the bilateral facility were used for the repayment of a group debt to Südzucker AG and of the Schuldscheindarlehen issued in 2014.