ForFarmers N.V.: ForFarmers 2020 first-half results

Lochem, 13 August 2020

ForFarmers 2020 first-half results

Solid recovery, supported by efficiency measures - despite challenging markets.

Highlights for first-half of 2020¹:

• Total Feed² volume: -5.6% to 4.8 million tonnes;
  of which compound feed: -4.9% to 3.4 million tonnes;
• Gross profit: +2.5% to €219.5 million; compared to depressed H1 2019 (purchasing position) and due to improved product mix with focus on specialties;
• Underlying EBITDA³ : +34.6% to €48.2 million; rise in gross profit and cost savings due to efficiency measures taken; 
• Underlying profit: +80.7% to €21.5 million;
• Working capital: (year-on-year) improved by €14.9 million to €76.5 million;
• Net cash flow from operating activities: almost tripled to €14.2 million.

[1] Results for the first half of 2020 are compared to the results for the same period of 2019
[2] ‘Total Feed’ covers the entire ForFarmers product portfolio and consists of compound feed, specialties, co-products (including DML products), seeds and other products (such as forage)
[3] Operating profit excluding depreciation, amortisation and incidental items

Outlook for 2020
Despite expectations of a protracted impact from COVID-19 ForFarmers forecasts that underlying EBITDA and net profit in 2020 will comfortably exceed the weak result in 2019, partly as a result of the efficiency measures taken.

Commenting on the 2020 first-half results ForFarmers CEO Yoram Knoop said:
"Both for many of our customers and for us, the first half of 2020 was dominated by the global outbreak of the coronavirus and the nitrogen debate in the Netherlands. We are proud that our employees have managed to continue producing and transporting feed without any complications for our customers, despite the COVID-19 measures imposed. The closure of the out-of-home sector impacted on our customers’ sales, in particular in the second quarter. This was reflected in our volume development, especially in the United Kingdom and Poland.

In addition our customers are facing increased pressure to reduce the environmental impact of their business, with this being translated into various measures in the countries where we operate. Particularly in the Netherlands, where the agricultural sector is a global leader in terms of developing sustainable concepts, the discussion surrounding future government measures to reduce nitrogen emissions, is causing turmoil and uncertainty in the sector. In this light there is a growing need for data-backed advice; this is at the heart of our Total Feed approach. 

The COVID situation has forced us to accelerate the implementation of our efficiency plans, meaning that our target of €10 million in cost savings has almost been reached already. Also as a result of this, we achieved a strong increase in underlying EBITDA despite the difficult market conditions, albeit in comparison to a weaker first half in 2019. This gives us confidence for the future. In addition we are working on next steps to make the organisation more efficient. We will announce the relating plans later this year.

There was a further increase in safety awareness at work, resulting in a 21% reduction in lost time incidents (LTIs). The knowledge, experience and dedication of staff is crucial to the successful rollout of any strategy. On 15 September we will publish our strategy for 2020-2025. With our employees, focus and Total Feed approach, we meet the key requirements to be successful in the challenging markets in which we operate,” said ForFarmers CEO Yoram Knoop.

Please find attached the pdf for the full press release or read it on our website.

Note to the editor / For additional information:
Caroline Vogelzang
Director Investor Relations
T: 0031 573 288 194 M: 0031 6 10 94 91 61
E: caroline.vogelzang@forfarmers.eu

Company profile
ForFarmers N.V. is an international organisation that offers complete and innovative feed solutions for livestock farming. With its ‘For the Future of Farming’ mission ForFarmers is committed to the continuity of farming and to further increasing the sustainability of the agricultural sector.
ForFarmers is the market leader in Europe with annual sales of 10.1 million tonnes of animal feed. The organisation operates in the Netherlands, Germany, Belgium, Poland and the United Kingdom. ForFarmers has approximately 2,600 employees. In 2019 revenue amounted to approximately €2.5 billion.
ForFarmers N.V. is listed on Euronext Amsterdam.

ForFarmers will publish its Third Quarter 2020 Trading Update on 30 October 2020.

ForFarmers N.V., Postbus 91, 7240 AB Lochem, T: +31 (0)573 28 88 00, F: +31 (0)573 28 88 99
info@forfarmers.eu/en/, www.forfarmersgroup.eu/en/

FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements, for example relating to ForFarmers’ legal obligations in terms of capital and liquidity positions in certain specified scenarios. In addition forward-looking statements may, without limitation, include phrases such as "intends to”, "expects”, "takes into account”, "is aimed at”, ''plans to”, "estimates" and words of a similar meaning. These statements pertain to or may affect matters in the future, such as ForFarmers’ future financial results, business plans and current strategies. Forward-looking statements are subject to a number of risks and uncertainties, which may lead to material differences between the actual results and performance and the expected future results or performance as implicitly or explicitly contained in the forward-looking statements. Factors that may result in, or contribute to, deviations from the current expectations include, but are not limited to: developments in legislation, technology, jurisprudence and regulations, share price fluctuations, legal procedures, investigations by regulatory bodies, the competitive landscape and general economic conditions. These and other factors, risks and uncertainties that may affect any forward-looking statements or the actual results of ForFarmers are discussed in the last published annual report. The forward-looking statements in this press release relate solely to I statements as of the date of this document and ForFarmers accepts no obligation or responsibility whatsoever to update the forward-looking statements contained in this release, regardless of whether these pertain to new information, future events or otherwise, unless ForFarmers is legally obliged to do so.

Attachment

• 200813_Press Release_Results ForFarmers first half-year 2020