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Outlook 2019|20

AGRANA-Group

With its diversified business model and sound balance sheet, AGRANA considers itself well positioned for the future. Despite the continuing substantial challenges in the Sugar segment, the Group’s operating profit (EBIT) is expected to increase significantly in the 2019|20 financial year. Revenue is projected to show moderate growth.

AGRANA-Group 2018|19 Actual 2019|20 Forecast
Revenue €m 2,443.0 Moderate increase
EBIT €m 66.6 Significant increase
Investment1 €m 183.8 143

1 Investment represents purchases of property, plant and equipment and intangible assets (excluding goodwill), including lease liabilities.

Fruit segment

In the Fruit segment, AGRANA expects the 2019|20 financial year to bring growth in revenue and EBIT. For the fruit preparations activities a positive revenue trend is predicted in all business areas, driven by rising sales volumes. Fruit preparations EBIT will reflect the volume and margin growth, resulting in a significant earnings improvement year-on-year. Especially the South America, North America, Europe and Mexico regions are expected to contribute to this uptrend. In the fruit juice concentrate business, revenue and EBIT are projected to be steady this financial year.

Fruit segment 2018|19 Actual 2019|20 Forecast
Revenue €m 1,179.1 Moderate increase
EBIT €m 77.3 Significant increase
Investment1 €m 56.2 57

1 Investment represents purchases of property, plant and equipment and intangible assets (excluding goodwill), including lease liabilities..

Starch segment

For the Starch segment, a moderate increase in revenue is forecast for the 2019|20 financial year. No major recovery in prices is expected for starch-based saccharification products, due to the continuing challenging market environment. Specialty products such as infant formula, organic and GMO-free products should continue to generate consistently positive impetus. Assuming an average grain harvest in 2019 and a slight reduction in raw material prices compared to the drought year 2018, EBIT is expected to be constant.

Starch segment 2018|19 Actual 2019|20 Forecast
Revenue €m 762.7 Moderate increase
EBIT €m 51.2 Stable development
Investment1 €m 97.0 66

1 Investment represents purchases of property, plant and equipment and intangible assets (excluding goodwill), including lease liabilities.

Sugar segment

For the Sugar segment, AGRANA is projecting consistently low revenue in expectation of a continued challenging sugar market environment. The ongoing cost reduction programmes will only be able to soften the margin reduction to some extent, and EBIT is thus expected to remain negative in the 2019|20 financial year.

Sugar segment 2018|19 Actual 2019|20 Forecast
Revenue €m 501.2 Slight increase
EBIT €m (61.9) Moderate increase
Investment1 €m 30.6 20

1 Investment represents purchases of property, plant and equipment and intangible assets (excluding goodwill), including lease liabilities.

Investment by segment 2019|20

Total investment across the three business segments in the financial year, at approximately € 143 million, is to significantly exceed the budgeted depreciation of about € 108 million.

Investment of approximately € 57 million is budgeted for the Fruit segment. Its focus is on asset replacement and maintenance investment, production optimisation projects and the continual improvement of product quality.

Investment of approximately € 66 million is budgeted for the Starch segment, with the largest single share of this allocated to the expansion of the wheat starch plant in Pischelsdorf, Austria.

Capital expenditures of approximately € 20 million are planned for the Sugar segment. The main focus is on asset replacement and maintenance investment.

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