DGAP-News

BayWa AG up slightly on the previous year after nine months

DGAP-News: BayWa AG / Key word(s): 9-month figures
BayWa AG up slightly on the previous year after nine months

10.11.2016 / 10:30
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BayWa AG up slightly on the previous year after nine months

BayWa AG, Munich, Germany, finished the first nine months of 2016 with a
3.3 percent EBIT increase to EUR85.4 million (nine months 2015: EUR82.7
million)* compared to the same period in the previous year. Revenues
climbed to EUR11.4 billion as at 30 September 2016 (2015: EUR11.1 billion).
"The international fruit business and global renewable energy activities
were able to compensate for the agricultural market developments, which
continue to be difficult, and ensured that the result after nine months was
up slightly on the previous year," said Klaus Josef Lutz, Chief Executive
Officer of BayWa AG, summarising business performance for the year through
the end of September. The building materials business and conventional
energy in particular benefited from a favourable economic situation and
also contributed to this result.
Agricultural markets on the national and international levels, however,
were shaped above all by producer prices, which continued to fall. "This is
impacting the entire agricultural industry. As a result, we are forced to
deal with the known effects arising from a six-year-low in wheat prices,
for example. They include increasing pressure on margins, less willingness
among producers to sell their grain and reticence among farmers to purchase
fertilisers, crop protection and agricultural equipment," Lutz explained.
Another example that he provided to illustrate the difficult agricultural
market development was exceptionally volatile soya trading: erratic weather
conditions in South America, as well as constantly changing harvest
forecasts and consumption estimates led to a rollercoaster ride for prices
this year on a scale seldom seen before. This was intensified by the
increasing influence of algorithmic trading at hedge funds.
Lutz noted that BayWa was also unable to escape this trend, resulting in a
year-on-year EBIT decline in the Agriculture Segment after nine months. Due
to the strained situation in the agricultural industry, it will remain
challenging to match the previous year's result. In looking ahead to 2017,
Lutz said that apart from continued positive performance in particular with
renewable energies and fruit, "we are already beginning to see good
indications in the agricultural industry that agricultural trading will