Auriga, Satisfactory developments in Q3 2012

Auriga Industries A/S, Harboøre, Denmark, 2012-11-15 08:00 CET (GLOBE NEWSWIRE) --  

Company announcement no. 15/2012

November 15, 2012

HIGHLIGHTS IN Q3 2012
Unaudited - Comparative figures for the prior-year period in brackets

Satisfactory developments in Q3

As expected, a soft growth was seen in Q3 as a result of the early season start and the strong growth in the first half of the year. Revenue was up 2% after satisfactory increases in Latin America and Europe. The gross margin improved by 2.2 percentage points to 27.4%, and an EBITDA margin of 8.2% was realized. The working capital improved by DKKm 135 which in addition to the increase in earnings resulted in lower debt and strengthened cash reserves. The previously announced outlook for 2012 as a whole is maintained.
  

• In Q3, revenue increased by 2% (4% at constant exchange rates (CER)) to DKKm 1,469 (DKKm 1,440), corresponding to a combined growth of 9% (9% CER) for the first nine months of the year. The growth is largely volume-driven, although sales prices saw a slight increase.
   
• An improved product mix boosted the gross margin to 27.4% (25.2%) in Q3 despite higher raw material costs. The operating profit before depreciation and amortization (EBITDA) was DKKm 121 (DKKm 121), while an operating profit (EBIT) of DKKm 80 (DKKm 78) was posted. In the first nine months of the year, an EBITDA margin of 11.6% (9.2%) and an EBIT margin of 9.1% (6.2%) were realized.
   
• Finance costs totaled DKKm 53 (DKKm 104), and the group’s profit before tax increased in Q3 to DKKm 27 (DKKm -26) and totaled DKKm 260 (DKKm 94) for the entire nine-month period.
   
• The cash flow from operating activities totaled DKKm 8 (DKKm 165) in Q3, and DKKm 166 (DKKm -129) for the first nine months of the year, where a free cash flow of DKKm 50 (DKKm -312) was realized.
   
• At the end of Q3, the working capital has improved by DKKm 135 relative to the same time last year, while the group’s net interest-bearing debt (NIBD) was reduced by DKKm 253 to DKKm 2,109 (DKKm 2,362), reducing the debt burden (NIBD/EBITDA) to 3.2 (4.5).

OUTLOOK 2012
 

• Crop prices remain high and have triggered a good season start in Latin America. The market for crop protection products is also expected to grow in Q4.
   
• As part of the restructuring of Stähler, an agreement was made to divest a small, non-strategic company, Chauvin SAS, which is engaged in the grafting of vines. The closing date is November 12, 2012. The transaction is based on an enterprise value of DKKm 16, resulting in an accounting profit of approx. DKKm 5.
   
• From time to time, Cheminova is involved in disputes. The termination of a commercial supply contract with an industrial customer in the USA in August 2010 has subsequently resulted in a dispute, which is to be resolved through arbitration according to the contract. Cheminova’s position is that the suit is groundless as the contract was terminated due to incurable breaches by the customer. If the arbitrator, whose decision is expected soon, contrary to expectations should award the customer with a compensation, this extraordinary expense will affect the results for Q4.
   
• When excluding the above extraordinary expense and provided that developments in Latin America remain positive, Auriga is maintaining the previously announced outlook for 2012 of revenue of approx. DKKm 6,300, an EBITDA margin of more than 10%, an operating profit of DKKm 450-550 and a positive free cash flow.
   

President & CEO Kurt Pedersen Kaalund comments on the development in Q3
As promised, we are reporting another quarter of positive momentum as demonstrated by increased sales in addition to rising EBITDA and value creation for the first nine months of 2012. In Q3, we increased crop protection sales by 5 pct. thereby achieving 12 pct. growth for the first nine months. We continue to build our position in key markets with an improved product portfolio to improve performance. We are fully focused on executing a strategic plan designed to improve profitability through balanced development on growth, cost improvements and working capital reduction.

PRESENTATION OF THE FINANCIAL RESULTS - AUDIOCAST AND CONFERENCE CALL
President & CEO Kurt Pedersen Kaalund, Senior Vice President, Finance & Support, Jesper Barslund Jacobsen, CFO in Cheminova, and Vice President Jens Ole Jensen will present the financial highlights at an audiocast/conference call for institutional investors and analysts today, November 15, 2012, at 10:00 am CET.

The presentation including Q&A session and conference call will be conducted in English. The presentation will be transmitted as audiocast on the website, where the related presentation will be available approx. 30 minutes beforehand. An indexed version of the presentation will be available on www.auriga.dk (Danish website) and www.auriga-industries.com (English website) afterwards.

Participants in the conference call are kindly requested to call in before 9:55 am (CET) on tel.:

• DK: (+45) 32 72 80 18
• International: (+44) 145 255 5131
   

MORE INFORMATION CONCERNING THE FINANCIAL RESULTS
 

Kurt Pedersen Kaalund, President & CEO
Tel. +45 40 80 99 01

Jens Ole Jensen, Vice President
Tel. +45 40 80 99 40

Investor Relations
Tel. +45 70 10 70 30 - investor@auriga.dk

Facts about Auriga

Auriga Industries A/S is the listed parent company of Cheminova A/S, which is the wholly owned operating company domiciled in Denmark. Cheminova is developing, producing and marketing chemical crop protection products. All activities are carried out with due consideration for the environment and in compliance with ever higher sustainability standards. The products are being sold in more than 100 countries, and exports count for 99% of sales. In 2011, the group posted revenue of approx. DKK 5.7 billion and has more than 2,100 employees in a global organisation with subsidiaries in 23 countries.