EANS-News: AGRANA reaffirms significant earnings growth for full 2019|20 financial year

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EBIT in first half still significantly below year-earlier period – Positive full-year forecast remains in place

Mid Year Results

Vienna - In the first half of the 2019|20 financial year, AGRANA, the fruit, starch and sugar company, generated operating profit (EBIT) of EUR 51.7 million, a decrease of 17.9% year-on-year (H1 prior year: EUR 63.0 million). The Group's revenue was stable, at EUR 1,250.0 million (H1 prior year: EUR 1,261.0 million). AGRANA Chief Executive Officer Johann Marihart says: "The lower EBIT earnings in the first half of the year were due primarily to the negative EBIT in the Sugar segment, which last year had not posted high losses until the second half of the year. For the year as a whole we will see a positive change in this business, as we expect a significant improvement compared to the second half of the prior year. The Group's EBIT decrease in the first half also reflected a year-on-year earnings reduction in the Fruit segment, where the market trend in fruit preparations was below expectations. The Group's best performance in the first six months was achieved in the Starch segment, with growth of 69% in EBIT compared to a year ago. This business segment benefited from higher ethanol prices as well as the capacity expansion in Aschach/D.(Austria)."

AGRANA Group consolidated financial results
EUR million, except %

H1 2019|20 H1 2018|19 Revenue 1,250.0 1,261.0 EBITDA* 90.8 97.0 Operating profit before exceptional items** 44.0 57.2 Share of results of equity-accounted joint ventures 7.7 6.6 Exceptional items 0.0 (0.8) Operating profit (EBIT) 51.7 63.0 Net financial items 4.1% 5.0% Profit for the period 28.9 39.9 Investment*** 68.1 82.7

Q2 2019|20 Q2 2018|19 Revenue 611.6 630.7 EBITDA* 39.3 43.5 Operating profit before exceptional items** 16.5 23.4 Share of results of equity-accounted joint ventures 4.3 3.3 Exceptional items 0.0 (0.7) Operating profit (EBIT) 20.8 26.0 EBIT margin 3.4% 4.1% Profit for the period 10.6 14.6 Investment*** 34.5 50.4

* EBITDA represents operating profit before exceptional items, results of equity-accounted joint ventures, and operating depreciation and amortisation ** Operating profit before exceptional items and results of equity-accounted joint ventures
*** Investment represents purchases of property, plant and equipment and intangible assets, excluding goodwill

Net financial items amounted to an expense of EUR 7.9 million (H1 prior year:
expense of EUR 10.9 million). After an income tax expense of EUR 14.9 million, corresponding to a tax rate of about 34.0% (H1 prior year: 23.4%), profit for the period was EUR 28.9 million (H1 prior year: EUR 39.9 million).

Net debt as of 31 August 2019 amounted to EUR 423.6 million, up EUR 101.4 million from the 2019|20 year-end level of 28 February 2019. The gearing ratio increased accordingly to 31.2% as of the interim balance sheet date (28 February 2019: 22.9%).

Fruit segment
EUR million, except %

H1 2019|20 H1 2018|19 Revenue 595.6 611.6 Operating profit (EBIT) 36.1 46.8 EBIT margin 6.1% 7.7%

Q2 2019|20 Q2 2018|19 Revenue 284.1 299.8 Operating profit (EBIT) 14.3 21.3 EBIT margin 5.0% 7.1%

The Fruit segment's revenue in the first half of 2019|20 decreased slightly year-on-year. Revenue in fruit preparations was flat, on stable sales volumes and prices. In the fruit juice concentrate activities, revenue was down from a year ago for price reasons, while volume was up. EBIT of the Fruit segment overall declined by 22.9% from the prior year's comparative period. The key drivers of this decrease were one-time effects, notably in the raw materials area, and lower-than-expected sales volume in the fruit preparations business.

Starch segment
EUR million, except %

H1 2019|20 H1 2018|19 Revenue 407.8 372.0 Operating profit (EBIT) 34.3 20.3 EBIT margin 8.4% 5.5%

Q2 2019|20 Q2 2018|19 Revenue 200.1 190.6 Operating profit (EBIT) 15..9 10.4 EBIT margin 7.9% 5.5%

Starch segment revenue in the first half of 2019|20 rose by almost 10% year-on-year. The main reason was a considerable increase in ethanol revenue due to stronger Platts quotations. In saccharification products, with declining prices, revenue was raised slightly by selling greater volumes. Native and modified starches saw revenue growth, thanks in part to volume increases. Revenue from baby food also rose. EBIT in the Starch segment surpassed the year-earlier result by 69.0%. The pronounced earnings growth stemmed primarily from the significant rise in the market price of ethanol and from volume gains in all other product segments.

Sugar segment
EUR million, except %

H1 2019|20 H1 2018|19 Revenue 246.6 277.4 Operating profit (EBIT) (18.7) (4.1) EBIT margin (7.6%) (1.5%)

Q2 2019|20 Q2 2018|19 Revenue 127.4 140.3 Operating profit (EBIT) (9.4) (5.8) EBIT margin (7.4%) (4.1%)

Sugar segment revenue in the first half of 2019|20 declined by 11.1% year-on-year. Lower sugar sales volumes, at selling prices comparable to the year-earlier period, were responsible for this decrease. EBIT of the Sugar segment fell sharply from a deficit of EUR 4.1 million to one of EUR 18.7 million, driven mainly by the sales volume decline and lower margins compared with the first half of the prior year.

Outlook

For the full 2019|20 financial year, AGRANA expects a significant increase in Group EBIT despite the continuing major challenges in the Sugar segment. Group revenue is projected to show moderate growth.

In the 2019|20 financial year the AGRANA Group plans to invest EUR 140 million, significantly exceeding the budgeted depreciation of about EUR 110 million. The largest project is the expansion of the wheat starch plant in Pischelsdorf near Tulln, Austria. The doubling of the wheat starch capacity at this site is progressing on schedule and the plant expansion will be brought on stream at the end of 2019.

About AGRANA

AGRANA converts agricultural raw materials into high-quality foods and numerous industrial intermediate products. About 9,600 employees at 57 production sites worldwide generate annual Group revenue of approximately EUR 2.4 billion. Established in 1988, the company is the world market leader in fruit preparations and the leading producer of fruit juice concentrates in Europe. As well, its Starch segment is a major manufacturer of custom starch products and of bioethanol. AGRANA today is also the leading sugar producer in Central and Eastern Europe.

This announcement is available in German and English at www.agrana.com [https:// www.agrana.com/en].

end of announcement euro adhoc

issuer: AGRANA Beteiligungs-AG
F.-W.-Raiffeisen-Platz 1
A-1020 Wien
phone: +43-1-21137-0
FAX: +43-1-21137-12926
mail: info.ab@agrana.com
WWW: www.agrana.com
ISIN: AT000AGRANA3
indexes: WBI
stockmarkets: Wien, Berlin, Stuttgart, Frankfurt
language: English

Digital press kit: http://www.ots.at/pressemappe/4/aom

Rückfragen & Kontakt:

AGRANA Beteiligungs-AG

Mag.(FH) Hannes Haider
Investor Relations
Tel.: +43-1-211 37-12905
e-mail:hannes.haider@agrana.com

Mag.(FH) Markus Simak
Public Relations
Tel.: +43-1-211 37-12084
e-mail: markus.simak@agrana.com

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