PRESS RELEASE : KWS posts stable business performance in the first quarter despite negative exchange rate effects - Guidance for the year confirmed

 
 DGAP-News: KWS SAAT SE & Co. KGaA / Key word(s): Quarterly / Interim 
Statement 
KWS posts stable business performance in the first quarter despite negative 
exchange rate effects - Guidance for the year confirmed 
 
2020-11-24 / 07:00 
The issuer is solely responsible for the content of this announcement. 
 
Einbeck, 24 November 2020 
 
KWS posts stable business performance in the first quarter despite negative 
exchange rate effects - Guidance for the year confirmed 
 
*Total net sales of the KWS Group (ISIN: DE0007074007) fell by 3.6% in the 
first three months of fiscal 2020/2021 due to negative exchange rate effects 
but increased by 6.8% on a comparable basis. As is customary in the first 
quarter, the key figures of EBITDA, EBIT and net income were negative. * 
 
"Our operational business performance was stable by and large in the first 
quarter," said Eva Kienle, Chief Financial Officer of KWS. "However, the 
fall in the value of a number of currencies, in particular in South America 
and Eastern Europe, weighed on our key financial indicators." 
 
Net sales for the first three month were at &euro 184.1 (191.0) million. 
EBITDA was &euro -27.3 (-21.8) million, while EBIT was &euro -50.5 (-42.3) 
million. The Group recorded a lower gross profit, as well as higher function 
costs for research and development and administration, while selling 
expenses fell year over year. 
 
Net financial income/expenses was &euro -15.2 (-22.2) million. Since the 
earnings contributed by the equity-accounted joint ventures do not 
materialize until the third quarter, net income from equity investments in 
the first quarter is well in the red. It totaled &euro -12.0 (-16.9) 
million. The interest result improved to &euro -3.2 (-5.3) million due to a 
fall in interest expenses. 
 
Income taxes totaled &euro -17.7 (-18.0) million. The result was net income 
for the period of &euro -47.9 (-46.6) million or &euro -1.45 (-1.41) per 
share. 
 
Free cash flow improved to -119.1 (-138.4 million ?,? excluding the 
acquisition of Pop Vriend Seeds) in the reporting period. 
 
*Overview of the key figures* 
 
*in &euro                  *Q1 2020/2021* *Q1 2019/2020*   *+/-* 
millions* 
Net sales                           184.1          191.0   -3.6% 
EBITDA                              -27.3          -21.8  -25.2% 
EBIT                                -50.5          -42.3  -19.4% 
Net financial                       -15.2          -22.2   31.5% 
income/expenses 
Result of                           -65.6          -64.6   -1.5% 
ordinary 
activities 
Income taxes                        -17.7          -18.0    1.7% 
Net income                        *-47.9*        *-46.6* *-2.8%* 
Earnings per      in &euro        *-1.45*        *-1.41* *-2.8%* 
share 
 
*Business performance of the segments* 
 
The *Corn Segment* grew its net sales by around 6% to &euro46.9 (44.4) 
million in the first quarter despite negative exchange rate effects. In main 
markets in South America, Argentina and Brazil, business expanded 
significantly in them (in terms of local currency). However, net sales were 
impacted heavily by negative exchange rate effects from the fall in value of 
the Argentinean peso and the Brazilian real. In the regions of Europe and 
North America, the segment does not generate any significant net sales in 
the first quarter due to seasonal reasons. The segment's income was &euro 
-41.0 (-37.5) million. 
 
The *Sugarbeet Segment* posts only low net sales in the first quarter due to 
seasonal reasons. Net sales in the first three months were &euro16.1 million 
and thus above the level of the previous year (&euro10.6 million). The 
revenue mainly comes from the sale of sugarbeet seed in Chile and North 
Africa. The segment's income fell to &euro -32.2 (&euro -28.5) million. 
 
Net sales in the *Cereals Segment* in the first quarter declined by around 
3% to &euro109.1 (112.0) million, but were at the level of the previous year 
after adjustment for exchange rate effects. The level of hybrid rye seed 
business varied in our sales regions, and net sales from it were around 5% 
below the same period of the previous year. However, the growth prospects 
for hybrid rye remain positive. Winter rapeseed business grew by around 5% 
on the back of improved conditions in the sowing season in a number of 
European countries. The segment's income was &euro36.0 million and thus at 
the level of the previous year (&euro36.6 million). 
 
Net sales in the *Vegetables Segment* fell significantly to &euro 13.3 
(27.0) million compared to the same quarter of the previous year, which 
showed a strong sales development. In addition, the food service market 
segment saw lower demand in connection with the COVID-19 pandemic. As a 
result of the course of business, EBITDA fell to &euro 2.4 (8.7) million and 
EBIT (including non-cash effects as part of the purchase price allocation 
for the acquisition of Pop Vriend Seeds) also fell to &euro -3.3 (3.0) 
million. 
 
Net sales in the *Corporate Segment* totaled &euro1.8 (1.6) million. They 
are mainly generated from KWS farms. Since all cross-segment costs for the 
KWS Group's central functions and basic research expenditure are charged to 
the Corporate Segment, its income is usually negative. The segment's income 
improved to &euro -22.0 (-30.9) million, mainly due to positive, exchange 
rate-related measurement effects from financial instruments. 
 
The difference from the KWS Group's statement of comprehensive income and 
segment reporting is due to the requirements of the International Financial 
Reporting Standards (IFRSs) and is summarized for the key indicators of net 
sales and EBIT in the reconciliation table below: 
 
*Reconciliation table* 
 
*in &euro millions*  *Segments* *Reconciliation* *KWS Group* 
Net sales                 187.1             -3.1       184.1 
EBIT                      -62.5             12.1       -50.5 
 
*Guidance for the 2020/2021 fiscal year confirmed* 
 
For the KWS Group, the Executive Board continues to expect net sales at the 
previous year's level (&euro1,282.6 million). Assuming that net sales are 
stable, the EBIT margin is expected to be in the range between 11% and 13% 
(after adjustment for the non-cash effects as part of the purchase price 
allocation for the acquisition of Pop Vriend Seeds). 
 
*Annual General Meeting 2020 in virtual format* 
 
The Annual General Meeting of KWS SAAT SE & Co. KGaA will take place on 
December 16, 2020 from 11:00 a.m. (CET) in virtual format (without physical 
presence). The documents and further information on the Annual General 
Meeting are available at www.kws.com. 
 
*About KWS** 
 
KWS is one of the world's leading plant breeding companies. More than 5,700 
employees in 70 countries generated net sales of around &euro1.3 billion in 
fiscal 2019/2020. A company with a tradition of family ownership, KWS has 
operated independently for more than 160 years. It focuses on plant breeding 
and the production and sale of seed for corn, sugarbeet, cereals, 
vegetables, rapeseed and sunflowers. KWS uses leading-edge plant breeding 
methods to continuously improve yield for farmers and plants' resistance to 
diseases, pests and abiotic stress. To that end, the company invested more 
than &euro200 million last fiscal year in research and development. 
 
* All figures excluding the shares of the equity-accounted companies 
AGRELIANT GENETICS LLC., AGRELIANT GENETICS INC. and KENFENG - KWS SEEDS 
CO., LTD. 
 
More information: www.kws.com [1]. Follow us on Twitter(R) at 
https://twitter.com/KWS_Group [2]. 
 
*Contacts:* 
 
Peter Vogt            Martin Heistermann            Sina 
Head of Investor      Senior Manager Investor       Barnkothe 
Relations             Relations                     Corporate 
Phone: +49-30         Phone: [phone]      Communicatio 
816914-490            [e-mail]    ns 
[e-mail]                                  Phone: 
                                                    +49-5561 
                                                    311-1783 
                                                    sina 
                                                    [3].barnkoth 
                                                    [e-mail] 
 
2020-11-24 Dissemination of a Corporate News, transmitted by DGAP - a 
service of EQS Group AG. 
The issuer is solely responsible for the content of this announcement. 
 
The DGAP Distribution Services include Regulatory Announcements, 
Financial/Corporate News and Press Releases. 
Archive at www.dgap.de 
Language:    English 
Company:     KWS SAAT SE & Co. KGaA 
             Grimsehlstraße 31 
             37555 Einbeck 
             Germany 
Phone:       [phone] 
Fax:         [phone] 
E-mail:      [e-mail] 
Internet:    www.kws.de 
ISIN:        DE0007074007 
WKN:         707400 
Indices:     S-DAX 
Listed:      Regulated Market in Frankfurt (Prime Standard), Hanover; 
             Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, 
             Munich, Stuttgart, Tradegate Exchange 
EQS News ID: 1150077 
 
End of News DGAP News Service 
 
1150077 2020-11-24 
 
 
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(END) Dow Jones Newswires

November 24, 2020 01:00 ET (06:00 GMT)