Earnings Release • Feb 17, 2017
Earnings Release
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PRESS RELEASE – FINANCIAL YEAR 2016
Rotterdam, 16 February 2017
Proposed dividend set at € 1.15 per share in best trading year ever
| • | Net profit: € 34.4 million | (2015: € 32.3 million, + 7%) |
|---|---|---|
| • | Sales: € 682.3 million | (2015: € 681.6 million, + 0%) |
| • | EBITDA: € 55.2 million | (2015: € 51.4 million, + 7%) |
| • | Earnings per share: € 1.428 | (2015: € 1.352, + 6%) |
| • | Solvency: 51.7% | (2015: 48.2%) |
| • | Proposed dividend: € 1.15 per share (2015: € 1.00 per share) |
In 2016, consolidated sales of Amsterdam Commodities N.V. (Acomo) increased by 0.1% to € 682.3 million (2015: € 681.6 million). The total gross margin increased by 4.1% and thereby increased our gross margin as a percentage of sales with 0.7 percentage points. The discontinuation of applying hedge accounting for Spices and Nuts had a positive effect on the margin (€ 0.9 million). The translation effect of the US dollar on the margin was negligible. For the full year 2016 net profit reached a very strong € 34.4 million, an increase of € 2.1 million versus 2015 (€ 32.3 million, + 6.6%).
The US dollar was comparable to 2015 during the first nine months but strengthened substantially during the last quarter in 2016 versus the euro. The average annual euro/US dollar exchange rate in 2016 was 1.1069 (2015: 1.1102). The impact of the euro/US dollar exchange rate on 2016 earnings was negligible. Like-for-like revenue was in 2016 similar to 2015.
The 2016 year-end exchange rate of 1.0524 is evidence of the stronger US dollar against the euro when compared to the 2015 year-end rate of 1.0862. As per 31 December 2016, currency effects led to an increase in total assets (+ € 4.9 million).
Given the record performance and the strong balance sheet position, the proposed 2016 dividend per share is € 1.15, an increase of 15% compared to 2015 (€ 1.00 per share), representing a pay-out ratio of 81% (2015: 74%). After the 2016 interim dividend of € 0.40 per share (2015: € 0.40), the final 2016 dividend is proposed at € 0.75 per share.
| 2016 | 2015 | |
|---|---|---|
| Consolidated figures (in € millions) | ||
| Sales | 682.3 | 681.6 |
| Gross margin | 114.6 | 110.0 |
| EBITDA | 55.2 | 51.4 |
| Operating profit (EBIT) | 50.4 | 47.1 |
| Financial result | -3.1 | -3.0 |
| Corporate income tax | -12.9 | -11.8 |
| Net profit | 34.4 | 32.3 |
| Shareholders' equity (before final dividend) | 182.9 | 168.3 |
| Total assets | 353.6 | 348.9 |
| Ratios | ||
| Solvency – shareholders' equity as % of total assets | 51.7% | 48.2% |
| Return on equity | 19.6% | 20.1% |
| Dividend pay-out ratio | 80.8% | 74.2% |
| Key performance indicators (in €) | ||
| Earnings per share | 1.428 | 1.352 |
| Equity per share at year-end | 7.550 | 7.016 |
| Dividend per share - total (2016: proposed) | 1.15 | 1.00 |
'I am proud of what all my colleagues in Acomo have achieved in the year 2016. It is again evidence that, together with our other stakeholders, our people with their specialist knowledge are capable of creating value in our business. It shows that we are in market segments that enable us to grow our business and in the meantime generate healthy profits. The record year is a result of strong performances across our group of companies. Catz International – which celebrated its 160th trading year – and King Nuts & Raaphorst had their best year in history. The Group achieved a net profit of € 34.4 million, a very strong performance', said CEO Erik Rietkerk. 'Our product segments Spices and Nuts, Edible Seeds and Food Ingredients performed extremely well, while Tea had a challenging year.'
Catz International in Rotterdam, the Netherlands, performed exceptionally well and delivered yet again a record year in difficult market circumstances. Sales dropped slightly versus 2015 on the basis of lower pricing and changes in the product portfolio. Gross margin was up by almost 4%. Gross margin as percentage of sales increased with 0.8 percentage points. As in previous years, Catz delivered the largest share of our net profit. The company faced volatile markets in the aftermath of El Niño, but the whole team at Catz again showed their skills in risk management and successfully utilized their market knowledge to deliver value for our suppliers and customers.
In a difficult market for nuts, Tovano in Maasdijk, the Netherlands, active in packed nuts and dried fruits, had an excellent year.
King Nuts & Raaphorst in Bodegraven, the Netherlands, active in nuts and rice crackers, was able to increase volumes and margins in 2016, resulting in a net profit which set a record high in the history of King Nuts & Raaphorst. Sales were up by 8% versus 2015, mainly driven by volume growth in almost all market segments. Gross margin increased significantly and as a percentage of sales it increased with one percentage point. This resulted in a net profit significantly above that of 2015. The team in Bodegraven continues to outperform the market by strict focus on market position and costs, thereby delivering impressive results.
Red River Commodities in Fargo, USA, which is active in sourcing, processing and distributing edible seeds (mainly sunflower), delivered a strong comeback versus 2015 in still difficult circumstances with low commodity prices and a strong dollar. The low commodity prices made it more difficult to increase margins and the strong dollar prohibited growth of our in-shell export business to Europe. The political situation in the Middle East and the currency volatility in countries like Turkey put a downward pressure on demand in the Mediterranean Rim. Despite this Red River Commodities was able to increase gross margin with 7% versus 2015, thereby achieving a net result that was significantly above that of 2015.
Wild bird food saw a mild winter resulting in a somewhat lower demand, but at higher gross margins. The export business saw a significant drop in revenue and volumes but did a great job in increasing gross margin in absolute terms. SunButter® profited from investments in marketing made in 2015 and 2016. Targeted marketing and increased spending resulted in increases in volumes and revenue of more than 20%. The investment in a new SunButter® roaster paid off in increased quality and margins. SunGold had a transitional year as reduced roasting volumes for kernel were impacted by SunButter® having its own roaster. Inshell sunflower volume was down slightly however with better margin. SunGold was able to increase the volumes of other roasted products like pumpkin seeds, chickpeas and soybeans such that its margin was held constant versus 2015.
Red River-van Eck in Zevenbergen, the Netherlands, made good use of trading opportunities in the poppy seeds market and realized good results in poppy and other bakery seeds. Volumes of poppy and other bakery seeds were somewhat down, resulting in a slightly lower gross margin. The Bulgarian sunflower activities are now being run purely as a trading activity managed from Zevenbergen and volumes were reduced in favour of an increased focus on profitability and costs. Improvements in the gross margin in Bulgaria were such that after the negative gross margin in 2015, 2016 showed a positive gross margin.
SIGCO Warenhandel in Hamburg, Germany, had a better year than 2015 and increased its gross margin with double-digit percentage points versus 2015. The company further started to realize synergies with Red Rivervan Eck at the back office level. With stable operating costs SIGCO improved its net result.
The teams in North America and Europe have proven to be able to cope with challenges while improving their operations and delivering good results.
Van Rees Group in Rotterdam, the Netherlands, experienced a challenging year in a turbulent market environment. Pricing developments were volatile, sometimes taking different directions in different regions. Due to record crops Kenya experienced falling price levels, whilst Colombo saw a stable first six months after which prices moved up aggressively as a result of drought. Some destination markets were confronted with often sharp devaluations and/or political unrest but risks were managed effectively. The newly acquired business in India was successfully integrated and performed well and to expectation, despite a severe drought in South India. The rollout of the ERP system continued and will be finalized in 2017.
The Group's natural food ingredients activities, now under a single Snick EuroIngredients proposition, delivered strong results in 2016. Volumes of all categories grew, resulting in higher gross margins in all categories. As the merger finalized, there were further savings in operating costs and efficiencies. Dry blends volumes continued to grow and this resulted in higher utilization of the plant in Ruddervoorde, Belgium. The portfolio saw an increase in the percentage of own blends (dry and wet). The drive and experience of the people in Ruddervoorde have delivered excellent progress in 2016.
The 2016 results include the financial effect of the discontinuation of applying hedge accounting for Spices and Nuts. The discontinuation had a positive impact on the 2016 net result of € 0.7 million. In 2015 the results were positively impacted by a number of one-off items of in total € 0.9 million.
Total assets per 31 December 2016 amounted to € 353.6 million (year-end 2015: € 348.9 million, + 1.3%). When corrected for the euro/US dollar exchange rate, total assets remained on the same level as 2015.
In 2016, the main financial developments were:
In January 2017 the Group extended the financing facilities with the existing banks for three years, with an option for another two years.
Management and the Supervisory Board are proposing a dividend of € 1.15 per share (2015: € 1.00). This represents a pay-out of 80.8% of earnings per share (2015: 74.2%). Taking into account the interim dividend of € 0.40 per share paid in August 2016, the final 2016 dividend would therefore amount to € 0.75 per share, payable in cash. The following dividend timetable applies:
27 April 2017 Ex-dividend date 28 April 2017 Dividend record date 11 May 2017 Dividend payment date
Q4 2016 was strong when compared to Q4 2015, driven by strong performance in all segments. The strong Q4 made the second half of 2016 significantly better than the second half of 2015.
The year 2017 started in line with the beginning of 2016. Given the nature of the Group's activities, it is impossible to forecast market developments or likely Group results. However, the company is confident that the teams will continue to generate good results for shareholders.
The annual general meeting of shareholders will be held on Tuesday 25 April 2017 at 10:00 a.m. at the Hilton Hotel in Rotterdam. The 2016 Annual Report will be published on www.acomo.nl on Thursday 9 March 2017, after the close of trading.
Rotterdam, 16 February 2017
Management Board and Supervisory Board
| Page | 7 | Consolidated balance sheet as at 31 December 2016 |
|---|---|---|
| Page | 8 | Consolidated income statement 2016 |
| Page | 9 | Consolidated cash flow statement 2016 |
This report in the English language has also been translated into the Dutch language. In case of any differences between the two versions, the English version will prevail.
For further information, please contact:
About Amsterdam Commodities N.V.
Tel. +31 10 4051195 Tel. +31 20 4525225 Fax +31 10 4055094 Fax +31 20 4528650
www.acomo.nl www.creativevenue.nl
Amsterdam Commodities N.V. (Acomo) is an international group with as its principal business the trade and distribution of natural food products and ingredients. Our main trading subsidiaries are Catz International B.V. in Rotterdam, the Netherlands (spices and food raw materials), Van Rees Group B.V. in Rotterdam, the Netherlands (tea), Red River Commodities Inc. in Fargo, USA (confectionary sunflower seeds), Red River Global Ingredients Ltd. in Winkler, Canada (sunflower seeds and other specialties), Red River-van Eck B.V. in Zevenbergen, the Netherlands, and SIGCO Warenhandelsgesellschaft mbH in Hamburg, Germany (edible seeds), King Nuts B.V. in Bodegraven, the Netherlands (nuts), and Snick EuroIngredients N.V. in Ruddervoorde, Belgium (food ingredients). Acomo shares have been traded on Euronext Amsterdam since 1908.
before final dividend
| (in € thousands) * unaudited ASSETS Non-current assets Intangible assets 62 919 60 436 Property, plant and equipment 42 138 42 091 Other non current receivables 1 356 - Deferred tax assets 173 470 Total non-current assets 106 586 102 997 Current assets Inventories 158 396 163 147 Trade receivables 81 401 75 150 Other receivables 2 649 4 627 Derivative financial instruments 2 735 1 613 Cash and cash equivalents 1 805 1 384 Total current assets 246 986 245 921 Total assets 353 572 348 918 EQUITY AND LIABILITIES Equity attributable to owners of the parent Share capital 10 901 10 796 Share premium reserve 52 447 50 571 Other reserves 15 499 13 268 Retained earnings 69 684 61 434 Net profit for the period 34 377 32 251 Total shareholders' equity 182 908 168 320 Non-current liabilities and provisions Bank borrowings 6 519 7 868 Deferred tax liabilities 8 894 11 060 Retirement benefit obligations 2 062 1 908 Other provisions 279 1 213 Total non-current liabilities 17 754 22 049 Current liabilities Bank borrowings 85 233 100 476 Trade creditors 44 050 37 538 Tax liabilities 5 113 1 137 Derivative financial instruments 503 1 150 Other current liabilities and accrued expenses 18 011 18 248 Total current liabilities 152 910 158 549 Total equity and liabilities 353 572 348 918 |
31 December 2016 | 31 December 2015 |
|---|---|---|
The financials 2016 shown above are unaudited.
| 2016 | 2015 | |
|---|---|---|
| (in € thousands) | * unaudited | |
| Sales | 682 320 | 681 584 |
| Cost of goods sold | (567 743) | (571 566) |
| Gross profit | 114 577 | 110 018 |
| Personnel costs | (39 299) | (38 681) |
| General costs | (20 087) | (19 917) |
| (59 386) | (58 598) | |
| EBITDA | 55 191 | 51 420 |
| Depreciation and amortization | (4 751) | (4 298) |
| Operating income | 50 440 | 47 122 |
| Interest income | 73 | 23 |
| Interest expense | (3 222) | (2 841) |
| Other financial income and expenses | 53 | (273) |
| Profit before income tax | 47 344 | 44 031 |
| Corporate income tax | (12 967) | (11 780) |
| Net profit | 34 377 | 32 251 |
| Total basic EPS (in €) | 1.428 | 1.352 |
| Total diluted EPS (in €) | 1.419 | 1.337 |
The financials 2016 shown above are unaudited.
| 2016 | 2015 | |
|---|---|---|
| (in € thousands) | * unaudited | |
| Cash flow from operating activities | 55 276 | 45 267 |
| Net changes in working capital | 4 817 | (13 510) |
| Paid interest and taxes | (13 102) | (11 075) |
| Net cash generated from operating activities | 46 991 | 20 682 |
| Cash flow from investing activities | (4 968) | (4 803) |
| Cash flow from financing activities | ||
| Dividend paid | (24 001) | (26 190) |
| Proceeds from new shares | 1 981 | 1 723 |
| Proceeds from new long term borrowings | 1 515 | - |
| Net changes in long term bank borrowings | (2 535) | (2 768) |
| Issued loan | (1 349) | - |
| Net changes in bank financing of working capital | (17 192) | 11 135 |
| Cash flow from financing activities | (41 581) | (16 100) |
| Net increase/(decrease) in cash and cash equivalents | 442 | (221) |
| Cash and cash equivalents at the beginning of the year | 1 384 | 1 558 |
| Exchange gains/(losses) on cash and cash equivalents | (21) | 47 |
| Cash and cash equivalents at the end of the year | 1 805 | 1 384 |
The financials 2016 shown above are unaudited.
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