Press

The AGRANA Group’s revenues during the first quarter of the current 2005/06 financial year (1 March through 31 May 2005) were 23.5 per cent up on the same period of 2004/05 at € 282.1 million.  The rise in revenues reflected rapid growth in the group’s Specialities Segment, where the newly acquired Wink und Steirerobst groups were accounted for as consolidated members of the group, having not been included in the scope of consolidation in the same period of the previous financial year.

Because of lower sugar prices and high but less profitable sugar exports, the group’s first-quarter profit from operating activities was 4.7 per cent below the previous year’s excellent figure of € 19.3 million at € 18.4 million.  Taking into account a reduced first-quarter loss on investing and financial activities of € 0.6 million (Q1 2004/05: loss of € 2.0 million), the group’s profit before income tax was 3.5 per cent up on the year at € 17.8 million (Q1 2004/05: € 17.2 million).  Its first-quarter consolidated earnings came to € 13.7 million (Q1 2004/05: € 14.0 million).

There was a net increase in cash and cash equivalents of € 16.0 million during the first quarter of 2005/06, as against a net decrease of € 18.9 million in the same period of the previous financial year.  These figures do not yet include the Atys Group because it will only be consolidated as of the second quarter of 2005/06.

 

Revenues broke down by segment as follows:

Change in the Board of Management
Markwart Kunz resigned as a member of the Board of Management as of 7 July 2005.  The Supervisory Board appointed Thomas Kölbl in his place.

The AGRANA share
On 21 March 2005, AGRANA was admitted to the ATX (Austrian Traded Index), which is the index of the shares most traded in Vienna.  It currently has an ATX weighting of 0.6 per cent.  In June 2005 the share had a weighting of 0.81 per cent.  Daily turnover of the AGRANA share during the first quarter of 2005/06 (single-counted) averaged 18,990 units, which was 18,297 more than the previous year’s first-quarter average of 693.  This reflects the significant increase in free float since the capital increase in February 2005.

Sugar Division
The Sugar Division’s first-quarter revenues were 7.4 per cent up on the previous financial year at € 185.5 million.  Total first-quarter sugar sales by volume increased by nearly 32 per cent to 137,200 tonnes.  That growth was largely due to higher exports.  A sugar beet harvest of 2.7 million tones is being expected in Austria this year.  The group has concluded cultivation contracts for a total of about 2 million tones of beet in Hungary, the Czech Republic, Slovakia and Romania.

The EU commission published its Legal Proposal for reform of the EU sugar CMO on 22 June 2005.  The proposal recommends the creation of a restructuring fund to encourage the voluntary cessation of white sugar production in exchange for an exit payment, a 42.6 per cent cut in the minimum beet price and a cut of 39 per cent in the sugar reference price.

AGRANA is excellently located in the prime sugar-beet growing areas within Central Europe.  As things stand at the moment, sugar extraction there will remain profitable even under the changed market conditions.  AGRANA will also benefit from an increase in Hungrana’s EU isoglucose quota.  The systematic expansion of the Group’s speciality starches operations and the continued rapid development of its third Fruit division will also help ensure AGRANA’s future growth.

Starch Division
Despite lower prices, optimization of the product mix and an increase in sales by volume made it possible to increase first-quarter starch revenues by about 9 per cent.  Contracts have been signed with 1,899 growers for a total of 216,700 tonnes of starch potatoes (2004: 229,200 tonnes).  Contracts have also been concluded for 12,400 tonnes of potatoes for use by the food industry and for 7,300 tonnes of organic potatoes.

Total maize processed during the first quarter of 2005/06 was roughly 9 per cent up on the year.  The maize starch factory in Aschach expects to process about 284,000 tonnes of maize during the 2005/06 financial year.  The International Starch Division’s sales by volume and value during the first quarter of 2005/06 were both roughly 11 per cent up on the same period of the previous year.

Bioethanol
At the beginning of May 2005, the group decided to begin bioethanol production.  The bioethanol factory in Pischelsdorf on the Danube will cost € 105 million and will have an annual production capacity of 200,000 cubic metres of bioethanol.  The start of production is planned for mid-2007.
Bioethanol capacities at the Hungrana isoglucose and maize starch factory in Hungary will be increased during the second quarter of 2005/06.  Hungrana will have produced about 63,000 cubic metres of bioethanol for the Hungarian oil industry by the year 2007.

Fruit Division
During the first quarter of the 2005 calendar year, the AGRANA Fruit Division’s fruit juice concentrates plants in Poland, the Ukraine and Hungary bought 10,763 tonnes of warehouse apples and processed them into 1,620 tonnes of apple juice concentrates.  A quantitatively and qualitatively good strawberry harvest is being forecast for this year.  Harvests of other fruits are expected to be normal.

In March 2005, AGRANA acquired another 6 per cent of Atys S.A., increasing its stake to 56 per cent.  Atys is the world’s leader in fruit preparations.  As a result of the increase, Atys will be a fully consolidated member of the AGRANA Group from the second quarter of the 2005/06 financial year.  The Atys Group’s sales by volume of fruit preparations during the first quarter of the 2005 calendar year were 9 per cent up on the same period of the previous year.  Construction of the new plant in Tennessee, USA, has been completed.
Both Vallø Saft and Wink reported a sharp increase in fruit juice concentrate sales by volume during the first quarter of the 2005 calendar year.

Steirerobst’s sales by volume of fruit juice concentrates during the first quarter of the 2005 calendar year were about 8 per cent up on the same period of 2004.  Trial production at the Group’s new fruit preparations plant in Serpuchov near Moscow began as planned.  In addition, the Group’s Center of Innovation and Excellence at Gleisdorf has begun operations.

The General Meeting of Shareholders of Steirerobst AG held on 7 June 2005 voted to convert Steirerobst’s preference shares into ordinary shares.  Because of the share’s low liquidity, Steirerobst’s small free float and the company’s consolidation within the AGRANA Group, Steirerobst is making preparations to withdraw from the stock exchange during the second half of the 2005 calendar year.

Outlook
The development of revenues this financial year will reflect AGRANA’s rapid growth, especially in the fruit sector.  The inclusion of the Atys Group in the scope of consolidation as of the second quarter of 2005/06 will increase revenues to over € 1,400 million during 2005/06, and about 40 per cent of that total will be accounted for by fruit operations.  We expect a sugar quota cut by the EU (declassification). Nonetheless, AGRANA is confident of being able to build on last year’s good results.