“Adjusted for items affecting comparability, the 2015 earnings are the best Lantmännen has ever delivered. Even when you include non-recurring items, the earnings are historically high and on a par with last year when we reported large effects on earnings such as the IPO of Scandi Standard,” says Per Olof Nyman, Group President and CEO, Lantmännen.
“During the course of the year we have achieved our long-term targets of an 8 percent return on shareholders' equity and an equity ratio of 40 percent. Lantmännen continues to deliver in accordance with our strategy; we have strengthened our position in the grain value chain in the Baltic Sea region via the acquisition of Vaasan and have created a broader platform for exports to other important markets. We have also implemented measures to make our purchasing and logistics more efficient, and are continuing our efforts to create added value from Swedish grain, which strengthens Swedish agriculture,” Per Olof Nyman continues.
All the figures below relate to operating profit for the full year 2015, adjusted for items affecting comparability. The previous year's figures are in brackets.
Agriculture Sector earnings continue to improve and amount to MSEK 237 (56). A strong improvement in earnings within the Swedish operation is primarily the result of increased customer focus and well implemented cost reduction and efficiency programs. The 2015 harvest was the largest in many years, with a total of 2.7 million tons delivered to Lantmännen; almost 500,000 tons more than the previous year. The feed business has developed well during the year, helped by more efficient production and the successful launch of a new feed range.
All Machinery Sector businesses delivered improved earnings and total operating profit for the Sector amounted to MSEK 255 (181). Our Machinery Sector managed to improve earnings despite yet another year with a decreasing Swedish tractor market. The market downturn has been countered by comprehensive efforts to improve efficiency and customer focus which have helped Lantmännen retain its leading position on the Swedish market. Once again, Valtra was the market leader in 2015 with a market share of around 24 percent. Lantmännen has also acquired Kalmar Lantmän's machinery business with effect from 1 January 2016.
There was a sharp improvement in earnings in the Energy Sector that amounted to MSEK 218 (61). The most notable improvement came in Lantmännen Agroetanol, thanks to a continuing efficiency drive, a more diversified raw material base and the introduction of new products. An important breakthrough was also achieved in Germany where demand for more sustainable ethanol with low carbon dioxide emissions benefited Lantmännen Agroetanol.
The Food Sector increased earnings to MSEK 733 (521), an improvement driven by efficiency gains within production, innovative new customer offers and the acquisition of the Finnish bakery group Vaasan, Lantmännen’s biggest acquisition ever. The integration of Vaasan into Lantmännen Cerealia and Lantmännen Unibake is going according to plan. The combined resources and expertise of Lantmännen and Vaasan have created an even stronger food business within the grain value chain in the Baltic Sea region.
Lantmännen Real Estate has continued its development and delivered earnings of MSEK 314 (223). This increase is due to improvements in day-to-day operations and from various property development projects.
“We have strategically positioned Lantmännen for continued profitable growth within the framework of Strategy 2020. In 2016 we will continue to expand our business operations in our home markets and also in strategic export markets. Innovation, in terms of both new products and smarter ways of working, remains key. We will continue to improve cooperation between businesses in the grain value chain to further strengthen the competitiveness and profitability of our owners' farms,” says Nyman.
The Board has decided to raise the refund and final price adjustment of trading with Lantmännen Lantbruk Sweden by 0.5 percent, to 2.0 percent (1.5). The Board has also resolved to pay a 0.5 percent (0.5) refund to members on purchases from our Machinery Sector's Swedish business. In total, refunds and final price adjustment are expected to amount to MSEK 189 (135).
The Board proposes that the Annual Association Meeting resolves on an investment dividend of 9 percent (9), totalling MSEK 193 (178) and a contribution issue of MSEK 50 (150). Altogether, the proposed investment dividend and contribution issue amount to 11 percent (17) of the association's investment capital. The total dividend to owners would then amount to MSEK 432 (463). The Board proposes that the Annual Association Meeting resolves that the dividend on subordinated debentures should be 6.5 percent (9), or MSEK 16 (5) in total.
The full report is available at http://lantmannen.se/bokslutskommunike.
Lantmännen ek för discloses the information in this press release according to the Swedish Securities Markets Act and/or the Swedish Financial Trading Act. The information was provided for public release on 9 February 2016 at 8.30 AM CET.