Quarterly Report • Feb 27, 2019
Quarterly Report
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July 1 to December 31, 2018
| in € millions | 1st half of 2018/2019 |
1st half of 2017/2018 |
1st half of 2016/2017 |
1st half of 2015/2016 |
|---|---|---|---|---|
| Net sales and income | ||||
| Net sales | 289.1 | 244.1 | 280.0 | 219.5 |
| EBIT | –76.6 | –89.6 | –70.3 | –106.3 |
| Net financial income/expenses | –21.1 | –29.0 | –25.8 | –28.7 |
| Net income for the period | –61.2 | –80.6 | –64.3 | –95.8 |
| Financial position and assets | ||||
| Capital expenditure | 41.8 | 27.9 | 33.6 | 54.2 |
| Depreciation and amortization | 24.8 | 23.8 | 23.4 | 24.2 |
| Equity | 798.2 | 705.1 | 702.6 | 617.2 |
| Equity ratio in % | 50.0 | 48.2 | 47.4 | 45.5 |
| Net debt1 | 174.6 | 223.8 | 236.6 | 281.6 |
| Total assets | 1,596.9 | 1,463.5 | 1,481.0 | 1,356.7 |
| Cash flow from operating activities | –70.3 | –127.3 | –85.1 | –99.8 |
| Employees | ||||
| Number of full-time employees2 | 4,008 | 3,866 | 3,965 | 3,811 |
| Key figures for the share | ||||
| Earnings per share (in €) | –9.20 | –9.73 | –9.73 | –14.42 |
¹ Short-term and long-term borrowings – cash and cash equivalents – securities ² Number of employees on December 31
| in € millions | Segments | Reconciliation | KWS Group |
|---|---|---|---|
| Net sales | 332.3 | –43.2 | 289.1 |
| EBIT | –91.3 | 14.7 | –76.6 |
Our main markets are in the northern hemisphere, where our sales drivers corn and sugarbeet seeds are sown in the spring. Our winter cereals business, on the other hand, is over by the end of the period under review. In addition, net sales of corn, soybean and sugarbeet seed from our activities in the southern hemisphere are included in the semiannual financial statements. Due to this strongly seasonal nature of our business, the first half of the year (July to December) most recently contributed around 25% of the Group's annual net sales.
The KWS Group posted robust growth in the first half of fiscal 2018/2019 in a challenging global environment characterized by a large supply of and low prices for agricultural raw materials.
The KWS Group increased its net sales significantly by 18.4% to €289.1 (244.1) million in the first six months of the fiscal year. That strong growth is attributable in part to earlier deliveries of seed than in the previous year. All product segments (Corn, Sugarbeet and Cereals) contributed to this positive business trend.
The Corn Segment's performance was impacted by growth in corn seed business in South America and earlier deliveries in North America, partly for weather-related reasons. Growth in the Sugarbeet Segment is largely due to a rise in the proportion of early sales. A sharp rise in sales of rye seed in Europe was the main growth driver in the Cereals Segment (12.7%).
| in € millions | 1st half of 2018/2019 | 1st half of 2017/2018 | +/– |
|---|---|---|---|
| Net sales | 289.1 | 244.1 | 18.4% |
| Operating income | –76.6 | –89.6 | 14.5% |
| Net financial income/expenses | –21.1 | –29.0 | 27.2% |
| Result of ordinary activities | –97.7 | –118.6 | 17.6% |
| Income taxes | –36.5 | –38.0 | 3.9% |
| Net income for the period | –61.2 | –80.6 | 24.1% |
| Earnings per share (in €) | –9.20 | –12.23 | 24.8% |
The KWS Group's net sales in the first half of fiscal 2018/2019 rose by 18.4% to a total of €289.1 (244.1)1 million. All product segments (Corn, Sugarbeet and Cereals) contributed to this positive business trend. As usual due to the seasonal course of our business, cereal seed business accounted for a large share (48%) of total net sales in the first six months of 2018/2019.
1 The figures in parentheses are those for the previous year.
The region where we generated most of our business was Europe, which accounted for 60% of net sales (Germany: 19%). Revenues from our North American equity-accounted companies were relatively low due to seasonal factors (see the section "Segment reports" on pages 8 to 9).
The strong decline in value of a number of local currencies in countries where the KWS Group operates – in particular Brazil and Argentina – had significant negative effects on net sales, which are consolidated in euros. Adjusted for exchange rate effects, the KWS Group's net sales would have been €329.3 million, a rise of 34.9%.
The KWS Group's operating income (EBIT) improved in the first half of 2018/2019 by 14.5% to €–76.6 (–89.6) million. The strong increase in gross profit was partly offset by higher function costs for sales and administration. Income generated by our receivables management activities also had a positive impact.
Net financial income/expenses improved to €–21.1 (–29.0) million, mainly due to the rise in net income from our equityaccounted companies to €–16.0 (–25.5) million. Since the main revenue from our joint ventures does not materialize until the third quarter, net income from those investments in the first half of the year is usually well in the red. The interest result is made up of interest income and, predominantly, interest expenses. The balance was €–5.1 (–3.5) million and thus a slight increase over the previous year due to higher interest expenses.
Income taxes totaled €–36.5 (–38.0) million. The result was a sharp improvement in net income for the period to €–61.2 (–80.6) million or €–9.20 (–12.23) per share.
No trend for earnings for the year as a whole can be deduced from these developments (see the section "Importance of the first half for the fiscal year").
| 1st half of 2018/2019 | 1st half of 2017/2018 | +/– |
|---|---|---|
| 150.0 | 121.1 | 23.9% |
| –70.3 | –127.3 | 44.8% |
| –45.8 | –27.5 | –66.5% |
| 74.2 | 86.3 | –14.0% |
The KWS Group's seasonal course of business impacts its cash flow statement, which changes significantly in the course of the year. Net cash from operating activities increased to €–70.3 (–127.3) million, while cash earnings were €–67.4 (–73.2) million.
Net cash from investing activities fell by €18.3 million to €–45.8 (–27.5) million due to higher capital expenditure on property, plant and equipment. KWS issues short-term commercial papers in order to finance its general business operations during the year. Net cash from financing activities fell to €74.2 (€86.3) million. Cash and cash equivalents totaled €150.1 (121.1) million.
The KWS Group invested a total of €41.8 (27.9) million in the first half of fiscal 2018/2019. The main focus of that is on erecting and expanding production and research and development capacities. We plan to increase our capital spending to more than €100 million for the year as a whole.
| in € millions | December 31, 2018 | June 30, 2018 | +/– |
|---|---|---|---|
| Assets | |||
| Noncurrent assets | 739.3 | 691.3 | 6.9% |
| Current assets | 857.6 | 826.4 | 3.8% |
| Equity and liabilities | |||
| Equity | 798.2 | 881.8 | –9.5% |
| Noncurrent liabilities | 328.7 | 334.3 | –1.7% |
| Current liabilities | 470.0 | 301.6 | 55.8% |
| Total assets | 1,596.9 | 1,517.7 | 5.2% |
The KWS Group's balance sheet during the year is impacted sharply by the seasonal course of its business. There are thus usually significant changes in balance sheet items, in particular for working capital, in the course of the year. Inventories rose by €182.7 million to €363.7 (181.0)1 million. Cash and cash equivalents fell by €54.6 million due to financing of our general business operations. Trade receivables were €190.1 (310.1) million. Negative operating income resulted in the decline in equity customary at this time of the year and the equity ratio fell to 50.0% (58.1%). Net debt was €174.6 (37.4) million. Total assets at December 31, 2018, were €1,596.9 (1,517.7) million.
| December 31, 2018 | December 31, 2017 | |
|---|---|---|
| Germany | 1,721 | 1,618 |
| Europe (excluding Germany) | 1,177 | 1,211 |
| North and South America | 424 | 404 |
| Rest of world | 686 | 633 |
| Total | 4,008 | 3,866 |
At December 31, 2018, we had 4,008 full-time employees worldwide.
1 The figures in parentheses in this section are those at June 30, 2018.
The KWS Group's interim consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS). The segments are presented in the economic report in line with our internal corporate controlling structure in accordance with GAS 20. The main difference is that we no longer carry the revenues and costs of our equityaccounted joint ventures and associated companies in the statement of comprehensive income. The KWS Group's reported net sales and EBIT will therefore be lower than the total for the segments. The earnings contributed by the equity-accounted companies are instead included under net financial income/expenses. In addition, their assets are included separately in the KWS Group's balance sheet. Our equity-accounted companies are included proportionately in the segment reports in line with our internal corporate controlling structure.
The difference from the KWS Group's statement of comprehensive income is summarized for a number of key indicators in the reconciliation table:
| in € millions | Segments | Reconciliation | KWS Group |
|---|---|---|---|
| Net sales | 332.3 | –43.2 | 289.1 |
| EBIT | –91.3 | 14.7 | –76.6 |
| Number of employees as of December 31, 2018 | 4,497 | –489 | 4,008 |
| Capital expenditure | 43.7 | –1.9 | 41.8 |
| Total assets | 1,755.2 | –158.3 | 1,596.9 |
Net sales in the Corn Segment rose year over year to €145.3 (110.5) million. An improved supply of seed resulting from the switchover in our portfolio meant that net sales in South America – and in particular in Brazil – were well up over the previous year. Net sales In North America likewise rose sharply as a result of early sales, in some cases for weather-related reasons. Only low revenue is usually generated in Europe in the first half of the year. The segment's EBIT improved to €–64.0 (–76.3) million. The segment generates the lion's share of its revenue and EBIT in the third quarter.
Net sales at the Sugarbeet Segment rose in the first half of the year to €45.3 (33.8) million. That is attributable in part to earlier deliveries in some markets, as well as to higher sales, for example in Eastern Europe. The segment's income in the first half of the year was €–22.7 (–27.3) million. As is customary, revenue from sugarbeet seed is still low in the first half of the year; significant net sales are not expected until the spring sowing season in the third quarter.
Net sales at the Cereals Segment rose in the first half of the year by 12.7% to €139.0 (123.3) million. That increase is mainly attributable to successful rye seed business, which benefited from the relatively stable yields hybrid rye delivers in the dry summer conditions in our main markets, as well as good commodity prices. Rye is relatively drought-tolerant compared to other cereal crops. Apart from rye, rapeseed and barley seed business also contributed to the growth in net sales. The segment's income improved to €47.0 (34.3) million due to higher contribution margins from rye business. The segment generates the lion's share of its revenue and EBIT in the first half of the year.
Net sales in the Corporate Segment totaled €2.7 (2.4) million. They are mainly generated from our farms. Since all crosssegment costs for the KWS Group's central functions and basic research expenditure are charged to the Corporate Segment, its income is usually negative. The costs consolidated in this segment rose slightly in the first half of the year, among other things due to additional work as part of our reorganization project ONEGLOBE. The segment's income was €–51.6 (–45.3) million.
| 2nd quarter of 2018/2019 |
2nd quarter of 2017/2018 |
1st half of 2018/2019 |
1st half of 2017/2018 |
|---|---|---|---|
| 111.5 | 76.6 | 145.3 | 110.5 |
| 32.0 | 20.4 | 45.3 | 33.8 |
| 43.9 | 28.1 | 139.0 | 123.3 |
| 1.5 | 1.2 | 2.7 | 2.4 |
| 188.9 | 126.3 | 332.3 | 270.0 |
| –23.7 | –35.9 | –64.0 | –76.3 |
| –5.3 | –9.9 | –22.7 | –27.3 |
| 19.1 | 6.4 | 47.0 | 34.3 |
| –26.5 | –20.2 | –51.6 | –45.3 |
| –36.4 | –59.6 | –91.3 | –114.6 |
There has been no significant change in the situation as to opportunities and risks compared with at June 30, 2018. Risks that jeopardize the company's existence are not currently discernible. You can find detailed information on the risk management system and the risk situation at the KWS Group in the Combined Management Report starting on page 65 of the 2017/2018 Annual Report.
We are sticking by our forecast from the 2017/2018 Annual Report. As far as can be seen at present, the EBIT margin is expected to be in a range from 10.0% to 12.0% on the back of a slight increase in net sales.
We also assume a significant expansion of our research & development and distribution activities, a slight decline in sugarbeet seed business, and an increase in administrative expenses. Expansion of our research and development activities will result in an increase in the R&D intensity to around 19%. As far as can be seen at present, our capital spending will amount to more than €100 million.
Due to the strongly seasonal nature of our business as a result of the great importance of the spring sowing season and external factors that are difficult to anticipate, such as the weather and fluctuations in cultivation area, more detailed statements on our net sales and earnings performance cannot be made with sufficient reliability at this juncture.
The guidance for our segments has changed from the last one in the Q1 Report for 2018/2019 as follows:
| Forecast as at 02/26/2019 (2nd quarter) |
Forecast as at 11/27/2018 (1st quarter) |
2017/2018 | |
|---|---|---|---|
| Net sales | slightly below previous year |
slightly below previous year |
€455 million |
| EBIT margin | at the previous year´s level |
below previous year | 35.3% |
| Forecast as at 02/26/2019 (2nd quarter) |
Forecast as at 11/27/2018 (1st quarter) |
2017/2018 | |
|---|---|---|---|
| Net sales | slightly above previous year |
clear growth | €734 million |
| EBIT margin | slightly above previous year |
well above previous year |
6.5% |
| Forecast as at 02/26/2019 (2nd quarter) |
Forecast as at 11/27/2018 (1st quarter) |
2017/2018 | |
|---|---|---|---|
| Net sales | well above previous year |
slightly above previous year |
€151 million |
| EBIT margin | at the previous year´s level |
slightly below previous year's level |
12.2% |
| Forecast as at 02/26/2019 (2nd quarter) |
Forecast as at 11/27/2018 (1st quarter) |
2017/2018 | |
|---|---|---|---|
| Net sales | at the previous year´s level |
at the previous year's level |
€4 million |
| EBIT | >€–90 million | >€–90 million | €–77 million |
1 The segment reporting proportionately includes the net sales and contributions to earnings from our equity-accounted companies in accordance with our internal corporate controlling structure.
| in € millions | 2nd quarter of 2018/2019 |
2nd quarter of 2017/2018 |
1st half of 2018/2019 |
1st half of 2017/2018 |
|---|---|---|---|---|
| I. Income statement | ||||
| Net sales | 147.7 | 108.1 | 289.1 | 244.1 |
| Operating income | –42.2 | –50.8 | –76.6 | –89.6 |
| Net financial income/expenses | –2.8 | –10.7 | –21.1 | –29.0 |
| Result of ordinary activities | –45.0 | –61.5 | –97.7 | –118.6 |
| Income taxes | –22.9 | –19.4 | –36.5 | –38.0 |
| Net income for the period | –22.1 | –42.1 | –61.2 | –80.6 |
| II. Other comprehensive income | ||||
| Items that may have to be subsequently reclassified as profit or loss |
11.0 | –13.0 | –1.2 | –30.1 |
| thereof revaluation of available-for-sale financial assets |
0.0 | 0.0 | 0.0 | 0.0 |
| thereof currency translation difference for economically independent foreign units |
9.6 | –11.4 | –2.9 | –23.9 |
| thereof currency translation difference from equity-accounted financial assets |
1.5 | –1.5 | 1.6 | –6.0 |
| Items not reclassified as profit or loss | 0.0 | 0.0 | 0.0 | 0.0 |
| thereof revaluation of net liabilities/assets from defined benefit plans |
0.0 | 0.0 | 0.0 | 0.0 |
| Other comprehensive income after tax | 11.0 | –13.0 | –1.2 | –30.1 |
| III. Comprehensive income (total of I. and II.) | ||||
| Net income for the period after shares of minority interests |
–22.5 | –42.6 | –60.7 | –80.7 |
| Share of minority interests | –0.2 | 0.5 | –0.5 | 0.1 |
| Net income for the period | –22.7 | –42.1 | –61.2 | –80.6 |
| Comprehensive income after shares of minority interests |
–6.6 | –55.5 | –61.9 | –110.9 |
| Share of minority interests | –0.2 | 0.5 | –0.5 | 0.1 |
| Comprehensive income | –6.8 | –55.0 | –62.4 | –110.8 |
| Earnings per share (in €) | –3.32 | –6.45 | –9.20 | –12.23 |
| Assets |
|---|
| in € millions | December 31, 2018 | June 30, 2018 | December 31, 2017 |
|---|---|---|---|
| Intangible assets | 82.8 | 85.5 | 81.9 |
| Property, plant and equipment | 422.6 | 401.7 | 388.9 |
| Equity-accounted financial assets | 136.0 | 150.4 | 119.2 |
| Financial assets | 4.4 | 3.6 | 4.7 |
| Noncurrent tax assets | 1.2 | 0.8 | 1.9 |
| Other noncurrent financial assets | 0.0 | 0.0 | 0.0 |
| Deferred tax assets | 92.3 | 49.3 | 84.7 |
| Noncurrent assets | 739.3 | 691.3 | 681.3 |
| Inventories | 363.7 | 181.0 | 375.2 |
| Biological assets | 4.9 | 14.3 | 3.0 |
| Trade receivables | 190.1 | 310.1 | 158.6 |
| Marketable securities | 30.3 | 18.3 | 29.4 |
| Cash and cash equivalents | 119.7 | 174.3 | 91.8 |
| Current tax assets | 79.6 | 56.8 | 79.1 |
| Other current financial assets | 36.6 | 52.9 | 29.7 |
| Other current assets | 32.7 | 18.7 | 15.1 |
| Current assets | 857.6 | 826.4 | 782.2 |
| Total assets | 1,596.9 | 1,517.7 | 1,463.5 |
| 19.8 Subscribed capital 19.8 19.8 Capital reserve 5.5 5.5 5.5 Retained earnings 770.6 853.7 677.2 Minority interests 2.3 2.8 2.6 Equity 798.2 881.8 705.1 127.6 Long-term provisions 127.8 123.4 158.0 Long-term borrowings 168.7 167.3 0.8 Trade payables 1.0 0.9 23.6 Deferred tax liabilities 19.3 11.7 Other noncurrent financial liabilities 0.3 0.3 0.3 Other long-term liabilities 18.4 17.2 19.0 Noncurrent liabilities 328.7 334.3 322.6 29.6 Short-term provisions 42.3 50.8 166.6 Short-term borrowings 61.3 177.7 120.5 Trade payables 75.7 95.3 32.4 Current tax liabilities 39.2 33.1 Other current financial liabilities 9.1 11.3 5.3 |
in € millions | December 31, 2018 | June 30, 2018 | December 31, 2017 |
|---|---|---|---|---|
| Other liabilities | 111.8 | 71.8 | 73.6 | |
| Current liabilities 470.0 301.6 435.8 |
||||
| 798.7 Liabilities 635.9 758.4 |
||||
| 1,596.9 Total assets 1,517.7 1,463.5 |
| Changes in equity | |||
|---|---|---|---|
| in € millions | Group interests | Minority interests | Group equity |
| 07/01/2017 | 834.5 | 2.5 | 837.0 |
| Dividends paid | –21.1 | 0.0 | –21.1 |
| Net income for the year | –80.7 | 0.1 | –80.6 |
| Other income after taxes | –30.1 | 0.0 | –30.1 |
| Total comprehensive income | –110.9 | 0.1 | –110.8 |
| Changes in minority interests | 0.0 | 0.0 | 0.0 |
| Other changes | 0.0 | 0.0 | 0.0 |
| 12/31/2017 | 702.5 | 2.6 | 705.2 |
| 07/01/2018 | 879.0 | 2.8 | 881.7 |
| Dividends paid | –21.1 | 0.0 | –21.1 |
| Net income for the year | –60.7 | –0.5 | –61.2 |
| Other comprehensive income after taxes | –1.2 | 0.0 | –1.2 |
| Total comprehensive income | –61.9 | –0.5 | –62.4 |
| Changes in minority interests | 0.0 | 0.0 | 0.0 |
| Other changes | 0.0 | 0.0 | 0.0 |
| 12/31/2018 | 796.0 | 2.3 | 798.2 |
| Cash proceeds and payments | ||
|---|---|---|
| in € millions | 1st half of 2018/2019 | 1st half of 2017/2018 |
| Net income for the period | –61.2 | –80.7 |
| Cash earnings | –67.4 | –73.2 |
| Funds tied up in net current assets | –2.9 | –54.1 |
| Net cash from operating activities | –70.3 | –127.3 |
| Net cash from investing activities | –45.8 | –27.5 |
| Net cash from financing activities | 74.2 | 86.3 |
| Change in cash and cash equivalents | –41.9 | –68.5 |
| Changes in cash and cash equivalents due to exchange rate, consolidated group and measurement changes |
–0.7 | –1.7 |
| Cash and cash equivalents at beginning of period (July 1) | 192.6 | 191.4 |
| Cash and cash equivalents at end of period | 150.0 | 121.2 |
The KWS Group is a consolidated group as defined in the International Financial Reporting Standards (IFRSs) published by the International Accounting Standards Board (IASB), London, taking into account the interpretations of the International Financial Reporting Interpretations Committee (IFRIC). All disclosures on KWS are therefore disclosures on the Group within the meaning of these regulations. Income taxes were calculated on the basis of the individual country-specific income tax rates, taking account of the planning for the fiscal year as a whole.
The KWS Group applied the new standards IFRS 9 "Financial Instruments" and IFRS 15 "Revenue from Contracts with Customers" for the first time effective July 1, 2018, and recognized the cumulated effects directly in equity at the time of initial adoption without adjusting the figures for the comparison period.
IFRS 9 specifies that a provision must be recognized in the balance sheet for expected credit losses for financial assets measured at amortized cost. The KWS Group uses the simplified approach for determining impairment of trade receivables and contract assets. Accordingly, a risk provision for the amount of credit losses anticipated over the entire term of each receivable in question must be set up. Historical credit losses and forward-looking information for each geographical region are taken into account in that. The one-time effect from measurement of the receivables on the basis of the expected loss impairment model is €5.7 million at the time of application of the new regulations. This effect was taken directly to the retained earnings.
In addition, first-time application of IFRS 15 results in new balance sheet items such as contract assets, contract liabilities and refund liabilities.
The other changes to IFRS 9 and IFRS 15 did not have any significant impact on the KWS Group's assets, liabilities, financial position and results. Further explanations of the changes in accordance with IFRS 9 and IFRS 15 can be found on pages 86 and 87 of the 2017/2018 Annual Report.
The 3-year cumulative inflation rate in Argentina exceeded the 100% mark for several months in succession. Consequently, Argentina was rated a hyperinflationary economy for the first time this fiscal year, as a result of which IAS 29 "Financial Reporting in Hyperinflationary Economies" was applied to KWS Argentina S.A. Application of IAS 29 mainly comprises:
On the basis of the current inflation index, application of IAS 29 resulted in the following effects for current financial reporting at December 31, 2018:
The condensed interim financial statements of the KWS Group for the first six months of fiscal 2018/2019 include the singleentity financial statements of KWS SAAT SE and its subsidiaries and joint ventures in Germany and other countries, the associated companies and the joint operation, which are carried in accordance with IFRS 11 and IAS 28. Subsidiaries that are considered immaterial for the presentation and evaluation of the financial position and performance of the Group are not included.
The companies KWS International Holding B.V. (in the Netherlands), KWS Kuban O.O.O. and Seed Plant KWS O.O.O. (both in Russia) were established in the first half of 2018/2019. The number of companies consolidated in the KWS Group thus increased from 71 at June 30, 2018, to 74.
| Sales per segment | ||||||
|---|---|---|---|---|---|---|
| in € millions | Segment sales 1st half |
Internal sales 1st half |
External sales 1st half |
|||
| 2018/2019 | 2017/2018 | 2018/2019 | 2017/2018 | 2018/2019 | 2017/2018 | |
| Corn | 145.3 | 110.6 | 0.0 | 0.1 | 145.3 | 110.5 |
| Sugarbeet | 45.8 | 34.2 | 0.4 | 0.3 | 45.3 | 33.8 |
| Cereals | 139.3 | 123.5 | 0.2 | 0.1 | 139.0 | 123.3 |
| Corporate | 3.0 | 2.9 | 0.3 | 0.5 | 2.7 | 2.4 |
| Segments acc. to management approach |
333.4 | 271.2 | 0.9 | 1.0 | 332.3 | 270.0 |
| Eliminination of equity-accounted financial assets |
–43.2 | –25.9 | ||||
| Segments acc. to consolidated financial statements |
289.1 | 244.1 |
| Segment earnings | ||||
|---|---|---|---|---|
| in € millions | 2nd quarter of 2018/2019 |
2nd quarter of 2017/2018 |
1st half of 2018/2019 |
1st half of 2017/2018 |
| Corn | –23.7 | –35.9 | –64.1 | –76.3 |
| Sugarbeet | –5.3 | –9.9 | –22.7 | –27.3 |
| Cereals | 19.1 | 6.4 | 47.0 | 34.3 |
| Corporate | –26.5 | –20.2 | –51.6 | –45.3 |
| Segments acc. to management approach |
–36.4 | –59.6 | –91.4 | –114.6 |
| Eliminination of equity-accounted financial assets |
–5.8 | 8.8 | 14.8 | 25.0 |
| Segments acc. to consolidated financial statements |
–42.2 | –50.8 | –76.6 | –89.6 |
| Net financial income/expenses | –2.8 | –10.7 | –21.1 | –29.0 |
| Earnings before taxes | –45.0 | –61.5 | –97.7 | –118.6 |
| in € millions | Operating assets | Operating liabilities | ||
|---|---|---|---|---|
| 2018/2019 | 2017/2018 | 2018/2019 | 2017/2018 | |
| Corn | 839.1 | 720.7 | 137.5 | 129.4 |
| Sugarbeet | 287.7 | 284.3 | 61.6 | 83.6 |
| Cereals | 136.4 | 131.1 | 24.9 | 25.3 |
| Corporate | 134.1 | 116.4 | 90.0 | 86.3 |
| Segments acc. to management approach |
1,397.3 | 1,252.5 | 314.0 | 324.6 |
| Eliminination of equity-accounted financial assets |
–333.1 | –244.9 | 6.8 | –54.9 |
| Segments acc. to consolidated financial statements |
1,064.2 | 1,007.6 | 320.8 | 269.7 |
| Others | 532.7 | 455.9 | 477.9 | 488.7 |
| KWS Group acc. to consolidated financial statements |
1,596.9 | 1,463.5 | 798.7 | 758.4 |
The explanations and methods stated in the section "Financial instruments" in the 2017/2018 Annual Report (pages 116 to 122) apply. The carrying amounts and fair values of the financial assets (financial instruments), split into the measurement categories in accordance with IAS 39, are as follows:
| in € millions | Financial instruments | ||||
|---|---|---|---|---|---|
| Fair Values | Carrying amounts | ||||
| Loans and receivables |
Financial assets held for trading |
Available for-sale financial assets |
Total carrying amount |
||
| Financial liabilities | |||||
| Financial assets | 4.4 | 0.0 | 0.0 | 4.4 | 4.4 |
| Other noncurrent financial assets | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| of which derivative financial instruments | (0.0) | (0.0) | (0.0) | (0.0) | (0.0) |
| Trade receivables | 190.1 | 190.1 | 0.0 | 0.0 | 190.1 |
| Securities | 30.3 | 0.0 | 0.0 | 30.3 | 30.3 |
| Cash and cash equivalents | 119.7 | 119.7 | 0.0 | 0.0 | 119.7 |
| Other current financial assets | 36.6 | 35.1 | 1.5 | 0.0 | 36.6 |
| of which derivative financial instruments | (1.5) | (0.0) | (1.5) | (0.0) | (1.5) |
| Total | 381.1 | 344.9 | 1.5 | 34.7 | 381.1 |
Carrying amounts and fair values of the financial assets at June 30, 2018
| in € millions | Financial instruments | ||||
|---|---|---|---|---|---|
| Fair Values | Carrying amounts | ||||
| Loans and receivables |
Financial assets held for trading |
Available for-sale financial assets |
Total carrying amount |
||
| Financial liabilities | |||||
| Financial assets | 3.6 | 0.0 | 0.0 | 3.6 | 3.6 |
| Other noncurrent financial assets | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| of which derivative financial instruments | (0.0) | (0.0) | (0.0) | (0.0) | (0.0) |
| Trade receivables | 310.1 | 310.1 | 0.0 | 0.0 | 310.1 |
| Securities | 18.3 | 0.0 | 0.0 | 18.3 | 18.3 |
| Cash and cash equivalents | 174.3 | 174.3 | 0.0 | 0.0 | 174.3 |
| Other current financial assets | 52.9 | 47.6 | 5.3 | 0.0 | 52.9 |
| of which derivative financial instruments | (5.3) | (0.0) | (5.3) | (0.0) | (5.3) |
| Total | 559.2 | 532.0 | 5.3 | 21.9 | 559.2 |
The carrying amounts and fair values of the financial liabilities (financial instruments), split into the measurement categories in accordance with IAS 39, are as follows:
Carrying amounts and fair values of the financial liabilities at December 31, 2018
| in € millions | Financial instruments | |||
|---|---|---|---|---|
| Fair Values | Carrying amounts | |||
| Financial liabilities measured at amortized cost |
Financial liabilities held for trading |
Total carrying amount |
||
| Financial liabilities | ||||
| Long-term borrowings | 157.3 | 158.0 | 0.0 | 158.0 |
| Long-term trade payables | 0.8 | 0.8 | 0.0 | 0.8 |
| Other noncurrent financial liabilities | 23.6 | 23.6 | 0.0 | 23.6 |
| of which derivative financial instruments | (0.0) | (0.0) | (0.0) | (0.0) |
| Short-term borrowings | 166.6 | 166.6 | 0.0 | 166.6 |
| Short-term trade payables | 120.5 | 120.5 | 0.0 | 120.5 |
| Other current financial liabilities | 9.1 | 7.3 | 1.8 | 9.1 |
| of which derivative financial instruments | (1.8) | (0.0) | (1.8) | (1.8) |
| Total | 477.9 | 476.8 | 1.8 | 478.6 |
Carrying amounts and fair values of the financial liabilities at June 30, 2018
| in € millions | Financial instruments | |||
|---|---|---|---|---|
| Fair Values | Carrying amounts | |||
| Financial liabilities measured at amortized cost |
Financial liabilities held for trading |
Total carrying amount |
||
| Financial liabilities | ||||
| Long-term borrowings | 171.0 | 168.7 | 0.0 | 168.7 |
| Long-term trade payables | 1.0 | 1.0 | 0.0 | 1.0 |
| Other noncurrent financial liabilities | 0.3 | 0.2 | 0.2 | 0.4 |
| of which derivative financial instruments | (0.2) | (0.0) | (0.2) | (0.2) |
| Short-term borrowings | 61.3 | 61.3 | 0.0 | 61.3 |
| Short-term trade payables | 75.7 | 75.7 | 0.0 | 75.7 |
| Other current financial liabilities | 11.3 | 9.1 | 2.2 | 11.3 |
| of which derivative financial instruments | (2.0) | (0.0) | (2.2) | (2.2) |
| Total | 320.6 | 316.0 | 2.4 | 318.4 |
The table below shows the financial assets and liabilities measured at fair value:
| Assets and liabilities measured at fair value | ||||||||
|---|---|---|---|---|---|---|---|---|
| in € millions | December 31, 2018 | June 30, 2018 | ||||||
| Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |
| Derivative financial instruments not part of a hedge under IAS 39 |
0.0 | 1.5 | 0.0 | 1.5 | 0.0 | 5.3 | 0.0 | 5.3 |
| Available-for-sale financial assets | 34.7 | 0.0 | 0.0 | 34.7 | 21.9 | 0.0 | 0.0 | 21.9 |
| Financial assets | 34.7 | 1.5 | 0.0 | 36.2 | 21.9 | 5.3 | 0.0 | 27.2 |
| Derivative financial instruments not part of a hedge under IAS 39 |
0.0 | 1.8 | 0.0 | 1.8 | 0.0 | 2.4 | 0.0 | 2.4 |
| Financial liabilities | 0.0 | 1.8 | 0.0 | 1.8 | 0.0 | 2.4 | 0.0 | 2.4 |
The related party disclosures in the 2017/2018 Annual Report and under Other notes in the section Notes for the KWS Group are essentially the same.
After the balance sheet date, the KWS Group sold 50% of its shares in KWS Potato B.V. (in future Aardevo B.V.), Netherlands, which had previously been fully consolidated in the consolidated financial statements, to J.R. Simplot Company, U.S. The two shareholders will pursue research and development activities under their joint control with the goal of developing extremely high-yielding potato varieties by means of hybrid breeding. Sale of the shares will have a significant positive effect on the KWS Group's net income for the third quarter of fiscal 2018/2019.
We declare to the best of our knowledge that these interim consolidated financial statements give a true and fair view of the assets, financial position and earnings of the KWS Group in compliance with the accounting principles applicable to interim reporting, and that an accurate picture of the course of business, including business results, and the Group's situation is conveyed by the interim group management report, and that it describes the main opportunities and risks of the KWS Group's anticipated development.
Einbeck, February 2019 KWS SAAT SE The Executive Board
Hagen Duenbostel Felix Büchting Léon Broers Peter Hofmann Eva Kienle
Tessner Beteiligungs GmbH 15.4% Free oat 30.1%
54.5% Families Büchting, Arend Oetker
| KWS SAAT SE | |
|---|---|
| Securities identification number | 707400 |
| ISIN | DE0007074007 |
| Stock exchange identifier | KWS |
| Transparency level | Prime Standard |
| Index | SDAX |
| Share class | Individual share certificates |
| Number of shares | 6,600,000 |
| Date | |
|---|---|
| May 16, 2019 | 9M Report 2018/2019 |
| October 23, 2019 | Publication of the 2018/2019 annual statements, Annual Press Conference and Analysts' Conference in Frankfurt |
| November 26, 2019 | Q1 Report 2019/2020 |
| December 17, 2019 | Annual Shareholders' Meeting in Einbeck |
The quarterly report can be downloaded on our websites at www.kws.de and www.kws.com. The KWS Group's fiscal year begins on July 1 and ends on June 30. Unless otherwise specified, figures in parentheses relate to the same period or date in the previous year. There may be rounding differences for percentages and numbers.
Investor Relations & Financial Press Peter Vogt [email protected] Phone: +49 30 209 136 217
Press Thilo Resenhoeft [email protected] Phone: +49 5561 311 1616
Sustainability Wolf-Gebhard von der Wense [email protected] Phone: +49 5561 311 968
Editor KWS SAAT SE Grimsehlstrasse 31 P.O. Box 1463 37555 Einbeck Germany
This document contains forward-looking statements about future developments based on the current assessments of management. These forward-looking statements may be identified by words such as "forecast," "assume," "believe," "assess," "expect," "intend," "can/may/might," "plan," "should" or similar expressions. These statements are subject to certain elements of uncertainty, risks and other factors that may result in significant deviations between expectations and actual circumstances. Examples of such risks and factors are market risks (such as changes in the competitive environment or risks of changes in interest or exchange rates), product-related risks (such as production losses as a result of bad weather, failure of production plants or quality-related risks), political risks (such as changes in the regulatory environment, including those with regard to the general regulatory framework for the cultivation of energy plants, or violations of existing laws and regulations, for example those regarding genetically modified organisms in seed) and general economic risks. Forward-looking statements must therefore not be regarded as a guarantee or pledge that the developments or events they describe will actually occur. We do not intend, nor do we assume any obligation, to update or revise these forward-looking statements, since they are based solely on circumstances on the day they were published.
Photo credits Alex Telfer
This translation of the original German version of the Semiannual Report 2018/2019 has been prepared for the convenience of our English-speaking shareholders. The German version is legally binding.
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