AGRAVIS finishes 2014 with respectable results
AGRAVIS Raiffeisen AG is maintaining its growth course. According to AGRAVIS CEO Dr. Clemens Große Frie at the balance sheet press conference, the company concluded the financial year that recently ended "respectably - despite the currency turbulence and a considerably weaker price level for volatile agricultural commodities". With sales revenue of euro 7. bn (previous year: euro 7.5 bn) the German agricultural trading group was able to reinforce its position and even expand its market share.
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- AGRAVIS brings home respectable results for 2014 (from the left): Thorsten Pogge, board member, Dr. Clemens Große Frie, CEO, Johannes Schulte-Althoff, board member and Bernd Homann, head of corporate communications, presented the course of business for 2014 at the balance sheet press conference in Münster, Germany.
At euro 42 million (previous year: euro 53 milion), the earnings before taxes are below the previous year's figure. Despite this, Große Frie stressed: "We finished 2014 respectably." AGRAVIS has achieved good to very good results in all areas – the "rain came in" at a few places", is how the AGRAVIS boss put it: "The currency turbulence – especially the rouble – cost us a few million euro in the operative business and we were not in the right place in the agricultural products wholesale business for the volatile market developments. This was because the market was totally irrational."
The group's highest ever investments total
"Nevertheless, a result of euro 42 million before taxes is one of the better consolidated results in AGRAVIS history – so there are not grounds for self-doubt." The other AGRAVIS figures underline the generally positive development of the company.
Our corporate group invested 92 million euros last year, more than ever before. In Große Frie's opinion, "that shows what a powerhouse and growth engine we are," which is why he's also steering the same course in investment policy this year. That spells out 75 million euros for maintenance, new equipment, agricultural locations, expanding and upgrading order-taking and storage performance. Put it all together and it spells out investing in our speed and effectiveness. "We're investing in the market and ratcheting up our level of performance, which is why 2014 will be taking the right move for launching our strategy. Our targets are 8/80. What does that mean? The boss at AGRAVIS' explains that 8/80 means 8 billion euros turnover at 80 million euros pretax accounting income. "We're firmly believe that we can generate more growth – by acquiring other companies, with cooperative relationships and investing and strategic alliances."
The company underlined this desire to grow in 2014, as Große Frie explains: For example, through the currently 40-percent stake in the milling group Roland Mills United. "This is a strategic path to secure sales in the grain business. We can imagine further cooperations with other partners here," states the AGRAVIS boss.
In the veterinary medicine branch, which is combined in the Animedica Group, the Group is continuing its investment strategy in higher margins production and retail areas – the Italian veterinary company Trei was recently integrated. With the construction of a feed mill in Straubing/Bayern, the AGRAVIS Group is underlining its expertise in the field of special feed. "And particularly here in the future market of mineral feeds. Apart from a series of national and international production locations, the production here in Straubing will be for the southern Germany," explains Große Frie.
Innovative solutions provider
The AGRAVIS Group sees itself as an innovative solutions provider. "When we took over the biogas plant in Dorsten, Germany – one of the largest in the region – we set out to develop the plant into a sustainable nutrient recycling facility. Together with our partner Odas, we have now succeeded in mainly using liquid fertiliser as an energy source – and not maize or grain. Therefore: we are also thinking about the nutrient situation in the region."
Große Frie, who again underlines the connection to the region and the German market, is also relying on international growth. "Our core market is Germany – above all in the north, west and east. But we also have to look beyond the horizon, i.e. out national boundaries." For the AGRAVIS boss, the expansion of the cooperation in the Danish DAVA Group is the highest priority: apart from the stronger and networked cooperation with Vilomix A/S – a Danish and international company for special feeds - and the AGRAVIS associated company HL Hamburger Leistungsfutter GmbH, the main focus of the cooperation in on the joint venture DAVA-AGRAVIS-International.
"We are very confident that together with the Danish agricultural retail company DAVA we will be able to take over the agricultural retail activities of Getreide AG." At present a decision is awaited from the Federal Cartel Office. The partners expect a decision here by mid-April.
Positive expectations for 2015
All this makes Große Frie feel positive about 2015. "For 2015 we expect stability – not stagnation! We want to solidify our position, by further increasing the equity, by expanding innovative business fields or a subject such as "Smart Farming". Above all, however, we want to to strengthen our position by realising our announced announced deal with DAVA – and with the acquistion of the agricultural retail business of Getreide AG. All in all: We find ourselves inwell positioned for a consolidation and expansion in the domestic and European agricultural retail market."
Overall, AGRAVIS expects sales revenue of around euro 7 billion for the current year with price levels comparable to 2014 and earnings before tax "that exceed the euro 50 million again."