Continued strong profit development in the first eight months of 2016
Lantmännen’s reported income after financial items up to and including the second third of 2016 amounts to 967 MSEK – compared to 908 MSEK for the same period the previous year. Items affecting comparability have impacted the year’s result with -54 MSEK. Adjusted for these items, Lantmännen’s result amounts to 1 021 MSEK (908 MSEK). All sectors are developing well, and the higher result is a continuation of the strong development since last year.
”2016 has so far been a very successful year for Lantmännen, and our businesses continue to develop positively. The new grain reception facilities that were opened for this year’s harvest have been well received, and Lantmännen’s harvest work has in most areas gone smoothly,” says Per Olof Nyman, Lantmännen’s CEO and Group President.
The figures below are adjusted for items affecting comparability, and refer to the period of January-August, 2016. Last year’s figures in brackets.
The Agriculture Sector has significantly increased its result to 250 MSEK (126 MSEK), virtually doubling the result from last year. The improvement is largely due to increased customer focus and stronger local presence, as well as well executed efficiency and cost reduction measures. The Swedish harvest is forecasted to be slightly higher than the last five-year average, with good quality, high protein content and good falling numbers. Lantmännen has strengthened its position in the competitive agricultural market, with higher market shares.
The Machinery Sector’s result amounts to 158 MSEK (122 MSEK). The sector continues to develop positively, despite a turbulent and cautious market for agricultural machinery. A lot of good work has been done in Lantmännen Maskin Sweden, in order to adapt the organization to both a decreasing market and a new supplier contract with AGCO. Swecon is developing well, and has strengthened its market shares in both Sweden and Germany.
The result in the Energy Sector amounts to 225 MSEK (139 MSEK). The strong improvement is mainly due to Lantmännen Agroetanol showing a significantly higher result than the previous year. Despite lower ethanol and feed prices, Agroetanol has improved its result through successful ethanol exports to Germany and increased sales of highly processed products.
The Food Sector has improved its result to 576 MSEK (514 MSEK). The higher result is mainly due to continued result improvements in Lantmännen Unibake, as well as the addition of the result from Vaasan, which is part of the sector since June of 2015. Lantmännen Cerealia continues its stable development, with a strong focus on developing innovative customer offers and products. Lantmännen Unibake has further strengthened its result in the second third of 2016, through continued production efficiency measures and further improvements of the result in the international operations.
The result in Lantmännen Real Estate, excluding property sales, amounts to 121 MSEK (120 MSEK), which is in line with the previous year. The external rental share has continued to increase during the last four-month period.
Four major items affecting comparability have impacted Lantmännen’s reported result by a total of -54 MSEK. In the Food Sector, insurance compensation for the fire at the bakery in Londerzeel, Belgium, affected the result of the second third positively by 357 MSEK. In the Energy Sector, a provision of 300 MSEK is made in the financial statements for the second third, due to the EU Commission’s ongoing investigation of Lantmännen Agroetanol and two other ethanol producers concerning alleged violations of EU competition law. Lantmännen is cooperating fully with the EU Commission. A provision of 50 MSEK is made in the Food Sector for restructuring costs in connection with Cerealia’s decision to close the facility in Odense and move production of cake and bread mixes to Sweden. In addition, production of pancakes is moved from Ockelbo to Laholm. Finally, costs in connection with property acquisition in Russia impacts the Food Sector’s result by -61 MSEK.
“We are continuously making investments for the future, to the benefit of our owners and customers – for example by developing our digital offer towards Swedish farmers, and through increasing our focus on industry policies and regulatory affairs. I look forward to finishing this year with a positive momentum in our businesses, and to maintaining the historically high price adjustment and refund we paid for 2015,” says Per Olof Nyman.
The interim report is also available at http://www.lantmannen.com/en/financialinformation
If you have any questions, please contact:
Per Olof Nyman, CEO and Group President, Lantmännen
Phone +46 706 57 42 47, email per.olof.nyman@lantmannen.com
Ulf Zenk, CFO, Lantmännen
Phone +46 725 61 15 63, email ulf.zenk@lantmannen.com
Lantmännen’s press office
Phone +46 730 46 58 00
This information is information that Lantmännen ek för is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out above, at 08.00 CET on October 5, 2016.
