Earnings Release • Nov 4, 2019
Earnings Release
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Vilmorin & Cie SA Public limited company with Board of Directors with a capital of 349,488,703 euros Head Office: 4, Quai de la Mégisserie – F-75001 PARIS SIREN Paris 377 913 728 Fiscal year from July 1 st to June 30th Euronext Paris (Compartment A) – Eligible for Deferred Settlement Order Indices: CAC Small, CAC Mid & Small and CAC All-Tradable
November 4, 2019, at 5:40 pm CET
Vilmorin & Cie's consolidated sales for the first quarter of 2019-2020, closing on September 30, 2019, corresponding to revenue from ordinary activities, stood at 231.9 million euros, up 11.8% with current data and 5.2% on a like-for-like basis.
| In millions of euros | 2018-2019 | 2019-2020 | Variation with current data |
Variation on a like-for-like basis |
|---|---|---|---|---|
| Sales at the end of the first quarter |
207.5 | 231.9 | +11.8% | +5.2% |
| Vegetable Seeds | 103.4 | 108.6 | +5.0% | +2.8% |
| Field Seeds | 96.5 | 116.1 | +20.3% | +7.9% |
| Garden Products and Holdings | 7.6 | 7.3 | -4.9% | +0.1% |
Consolidated financial information is established in compliance with the IFRS (International Financial Reporting Standards) reference, as applied by the European Union on September 30, 2019. It takes into account the application of the standard IAS 29 with regard to the treatment of hyperinflation for business in Argentina.
Sales for the Vegetable Seeds division stood at 108.6 million euros, up 5% compared to the same period of the previous fiscal year. Restated on a like-for-like basis, there was an increase of +2.8%.
Over the course of the first quarter, there was a strong increase in sales of several strategic crops, along the lines of the fourth quarter 2018-2019 which was of a very high level.
Just as in fiscal year 2018-2019, performances varied according to geographical area. Accordingly, business increased fast in certain regions, particularly in North America. Similarly, South America and the Middle East this year posted very significant business growth, whereas sales activity was considerably affected at the beginning of the previous fiscal year by the instability of the geopolitical and monetary context in these regions. However, business was less dynamic in Asia, Africa and Europe, especially Western Europe, where sales were penalized by drops in acreage for certain crops.
At the end of a quarter that is still not very representative of the fiscal year, the Vegetable Seeds division posted marked growth in its sales on September 30, 2019. Consequently, Vilmorin & Cie can confirm its sales growth objective for this activity for fiscal year 2019-2020, i.e. an increase of 3% on a like-for-like basis compared to 2018-2019.
Field Seeds division: a very good start to the fiscal year, boosted by a high-quality rapeseed campaign
Sales for the Field Seeds division for the first quarter reached 116.1 million euros, an increase of 20.3% with current data and 7.9% on a like-for-like basis.
In Europe, the commercial campaign for rapeseed posted another year of excellent growth. This highquality achievement, as for previous campaigns, was built on an extremely technically efficient product portfolio providing Vilmorin & Cie with a solid competitive advantage. Vilmorin & Cie thus continues to gain significant market shares, enabling the company to be positioned among the top European players in this crop.
Moreover, the first part of the commercial campaign for straw cereal seeds (wheat, barley) recorded a fine increase in sales. Sales of forage seeds and amenity grasses, which complement the commercial offer in Europe, fell sharply compared to the previous year, particularly in Germany and the Netherlands, after rising sharply during the previous fiscal year.
In South America, sales increased significantly, as a result of the integration of the companies Sursem (Argentina) and Geneze (Brazil), whose acquisition was finalized in December 2018. Restated on a likefor-like basis, business growth was measured. In Brazil, sales of soybean seeds increased very significantly, in line with previous years; Vilmorin & Cie is thus continuing to expand its commercial offer, enabling it to cover all the needs of South American farmers. Sales for the first corn campaign in Brazil (safra), were down, in a context of almost stable expected cultivated acreage for this crop. Order books for the second corn campaign (safrinha), where acreage is expected to decrease slightly compared to the previous fiscal year, are looking satisfactory.
Moreover, in Argentina, the sales activity is marked by the wait-and-see attitude of farmers, linked to the political context in this country.
For the coming commercial spring campaign, procurement of corn seeds is nearly complete in Europe and North America. They are marked by the difficulties encountered, due to the severe drought, affecting certain European production, the impacts of which will be covered by making use of security reserves.
On the basis of the above, Vilmorin & Cie reaffirms its objective to increase its Field Seeds sales for fiscal year 2019-2020, with growth of 2% on a like-for-like basis compared with the previous fiscal year.
Since 2016, Vilmorin & Cie has been part of the Gaïa Index, which includes the 70 French securities with the highest non-financial ratings out of a panel of 230 listed companies(1) .
index for listed French midmarket companies. The rating is based on more than 130 non-financial criteria (societal, social, environmental and governance).
(1) The Gaïa panel comprises 230 Small and Midcaps listed on the Paris stock market, that respect two of the three following criteria: sales < 5 billion €, capitalization < 5 billion €, headcount < 5,000, and whose securities are sufficiently liquid. Created in 2009 and developed by EthiFinance, Gaïa-Index selects Midcaps for their non-financial performances; it is the reference Sustainable Development
Its ranking in the index rose again in 2019: Vilmorin & Cie is now ranked 23rd out of the 230 companies analyzed (as opposed to 36th last year), with an overall score of 81/100. The average rating of the companies stood at 54/100.
This rating is a clear sign of the continuous progress Vilmorin & Cie has made in terms of non-financial performance.
Vilmorin & Cie is continuing to roll out its corporate social responsibility program in this regard. It is structured around three priorities: contributing to lasting progress in agriculture through seed; acting responsibly; and encouraging cooperation.
(1) On a like-for-like basis.
Consolidated sales for the first quarter in recent years have represented on average around 15% of sales for the year.
Fiscal year 2019-2020 should continue to be marked by heterogeneous market conditions in vegetable seeds and characterized by strong competitive pressure on field seeds.
In this context, and on the basis of business figures at the end of this first quarter, Vilmorin & Cie can confirm its objectives in terms of sales and current operating margin for fiscal year 2019-2020. These objectives correspond to an increase in consolidated sales of 2% to 3% on a like-for-like basis, and a current operating margin rate of at least 8%, including research investment which should be higher than 255 million euros.
Finally, Vilmorin & Cie is aiming for a contribution from its associated companies – mainly AgReliant (North America. Field Seeds), Seed Co (Africa. Field Seeds) and AGT (Australia. Field Seeds) of at least 20 million euros.
The preparatory documents for the Joint Annual General Meeting of Shareholders to be held on December 6, 2019 can be consulted in French on the company's website (www.vilmorincie.com, section "Publications", then "Assemblée Générale" and "Documents préparatoires à l'Assemblée Générale") or requested from the Corporate Finance Department.
Dates provided as an indication only, and liable to be changed (1) Disclosure after trading on the Paris stock market.
Vincent SUPIOT Chief Financial Officer [email protected]
Head of Financial Communication and Investor Relations [email protected]
Tel: + 33 (0)4 73 63 44 85 Website: www.vilmorincie.com
Vilmorin & Cie, the 4th largest seed company in the world, develops vegetable and field seeds with high added value, contributing to meeting global food requirements.
Accompanied by its reference shareholder Limagrain, both an agricultural cooperative owned by French farmers and an international seed group, Vilmorin & Cie's strategy for growth relies on strong, sustained investments in research and international development to durably strengthen its market shares on promising world markets.
True to its vision of sustainable development, Vilmorin & Cie ensures its achievements fully respect its three founding values: progress, at the heart of its beliefs and its mission, perseverance, inherent to farming and the seeds business, and cooperation, in the fields of science, industry and commerce.
You can consult the presentation of sales at the end of the first quarter 2019-2020 on the website www.vilmorincie.com, on the homepage.
| In millions of euros | 2018-2019 | 2019-2020 | Variation with current data |
Variation on a like-for like basis |
of which: Impact of currency |
Impact of scope |
|---|---|---|---|---|---|---|
| First quarter | 207.5 | 231.9 | +11.8% | +5.2% | +1.8 | +11.2 |
| Vegetable Seeds | 103.4 | 108.6 | +5.0% | +2.8% | +2.2 | 0.0 |
| Field Seeds | 96.5 | 116.1 | +20.3% | +7.9% | -0.4 | +11.6 |
| Garden Products and Holdings |
7.6 | 7.3 | -4.9% | +0.1% | 0.0 | -0.4 |
Like-for-like data is data that is restated for constant scope and currency translation. Financial data for 2018- 2019 is restated with the average rate for fiscal year 2019-2020, and any other changes to the scope, in order to be comparable with data for fiscal year 2019-2020
Variations in the consolidation scope come from the acquisition of the companies Sursem and Geneze (South America. Field Seeds) finalized in December 2018 and from the sale of the company Van Den Berg (Netherlands. Garden Products) in June 2019.
Current data is data expressed at the historical currency exchange rate for the period, and without adjustment for any changes in scope.
Research investment refers to gross research expenditure before recording as fixed assets any research costs and research tax relief.
The current operating margin is defined as the accounting operating margin restated for any impairment and reorganization costs.
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