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FirstFarms — Interim / Quarterly Report 2017
Nov 28, 2017
3433_rns_2017-11-28_8761583a-43d5-496b-8545-c2fd3344ace3.pdf
Interim / Quarterly Report
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FirstFarms
Company announcement no. 18/2017
28 November 2017
Interim financial report for 1 January – 30 September 2017 for FirstFarms A/S
Significant profit increase for the first 9 months and maintains expectations
The Board of Directors and Management of FirstFarms A/S have today reviewed and adopted the un-audited interim financial accounts for the period 1 January – 30 September 2017.
- The turnover has increased by DKK 45 million and result before tax has improved by DKK 7 million compared to same period last year.
- FirstFarms has in the accounting period realised a turnover of DKK 134.8 million, an EBIT result of DKK 9.3 million and a pre-tax result of DKK 1.9 million.
- FirstFarms maintains the announced expectations about an EBIT result of DKK 18-22 million. The assumption is a stable price on piglets and a milk price in Q4, 2017 on the present level.
- In the first 9 months of the year, the milk price has been significantly better than budget. The settlement price for milk has increased by DKK 0.85 pr. kg compared to same period last year.
- The price on piglets has been as budgeted in the first 9 months of the year.
- The sales prices for crops have in total been as budget.
- The harvest yields for the winter crops have been as budgeted, whereas the spring crops in general have suffered during the drought. Especially the maize yields are negatively affected in Slovakia and West Romania, whereas East Romania has harvest yields in line with expected. All in all, the yields will result in a negative influence on the result with DKK 15 million.
- The administration costs are increasing based on the expansion with activities in Hungary.
- In Hungary, two building sites are purchased, which gives the possibility to establish a pig project with 4,000 sows incl. piglets.
FirstFarms A/S offers issuance of new convertible bonds
FirstFarms A/S offers issuance of new convertible bonds for up to DKK 72.25 million according to the authorisation in item 5.6 in the Articles of Associations. The purpose of the bonds is a combined supplement of the company's cash resources and the continued implementation of the growth strategy in several of the existing business areas, with a special focus on the company's new business area of pig production.
In connection with issuance of new convertible bonds, the conversion price is determined to 57.25 in accordance with the authorisation and the terms of the convertible bonds, which are
Company announcement no. 18/2017 for FirstFarms A/S
Page 1 of 12
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
attached to this company announcement. The bonds are not subject to rules of the prospectus and are not traded on a regulated market.
The deadline for the subscription is scheduled to 12th December 2017 at 11.59 pm. Interested parties shall forward the enclosed binding subscription form to the following mail address: [email protected].
The interested parties will soon after the abovementioned deadline receive the convertible bond for signature, and the deadline for payment of the subscription amount is determined to 18th December 2017.
Best regards,
FirstFarms A/S
For further information:
Please visit our website www.firstfarms.com or
contact CEO Anders H. Nørgaard on telephone +45 75 86 87 87.
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Main and key ratios
| The Group Q1-Q3 | The Group Q1-Q3 | The Group Q3 | The Group Q3 | The Group | |
|---|---|---|---|---|---|
| DKK 1,000 | 2017 | 2016 | 2017 | 2016 | 2016 |
Main figures
| Turnover | 134,786 | 89,820 | 68,410 | 50,972 | 130,257 |
|---|---|---|---|---|---|
| Gross profit/loss | 14,821 | 9,775 | 3,314 | 1,643 | 7,330 |
| Profit/loss of primary operations | 9,317 | 1,439 | 1488 | -677 | -2,771 |
| Net financial items | -7,410 | -6,522 | -2,828 | -2,119 | -9,750 |
| Pre-tax result | 1,907 | -5,083 | -1,340 | -2,796 | -12,521 |
| Net profit | 2,214 | -4,206 | -1,096 | -2,629 | -12,957 |
| Non-current assets | 473,942 | 402,005 | 473,942 | 402,005 | 396,403 |
| --- | --- | --- | --- | --- | --- |
| Current assets | 168,733 | 149,583 | 168,733 | 149,583 | 119,112 |
| Total assets | 642,675 | 551,588 | 642,675 | 551,588 | 515,515 |
| Share capital | 51,376 | 47,122 | 51,376 | 47,122 | 47,122 |
| Equity | 313,498 | 302,034 | 313,498 | 302,034 | 292,823 |
| Non-current liabilities | 162,868 | 105,617 | 162,868 | 105,617 | 95,059 |
| Current liabilities | 166,309 | 143,937 | 166,309 | 143,937 | 127,633 |
| Cash flow from primary operations | 6,732 | -1,613 | 4,923 | 1,426 | 12,275 |
| --- | --- | --- | --- | --- | --- |
| Cash flow from operations | -1,510 | -8,397 | 2095 | -693 | 2,040 |
| Cash flow for investment, net | -27,771 | -12,719 | -12,353 | -3,722 | -18,817 |
| Of which for investment in tangible assets | -29,807 | -16,407 | -7,253 | -4,763 | -23,057 |
| Cash flow from financing | 28,031 | 22,615 | 7,253 | 10,589 | 4,792 |
| Total cash flow | -1,250 | 1,499 | -3,005 | 6,174 | -11,985 |
Key figures
| Gross margin | 11.0 | 10.9 | 4.8 | 3.2 | 5.6 |
|---|---|---|---|---|---|
| Operating margin | 6.9 | 1.6 | 2.2 | -1.3 | -2.1 |
| Solvency ratio | 49 | 55 | 49 | 55 | 57 |
| Earnings per share, DKK | 0.43 | -0.89 | -0.21 | -0.56 | -2.75 |
| Diluted earnings per share, DKK | 0.34 | -0.89 | -0.21 | -0.56 | -2.75 |
| Return on shareholders' equity | 1.0 | -1.8 | -1.4 | -3.5 | -4.2 |
| Average number of employees | 245 | 221 | 257 | 227 | 214 |
| --- | --- | --- | --- | --- | --- |
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Management report for the period 1 January – 30 September 2017
The turnover has increased by DKK 45 million and result before tax has improved by DKK 7 million compared to same period last year.
FirstFarms has in the accounting period realised a turnover of DKK 134.8 million, an EBIT result of DKK 9.3 million and a pre-tax result of DKK 1.9 million.
In 2017, the equity is increased with DKK 20.7 million, in consequence of a result after tax of DKK 2.2 million and an exchange rate adjustment of DKK -0.8 million and issuance of shares for DKK 19.3 million.
In the first 9 months of the year, the milk price has been significantly better than budget. The settlement price for milk has increased by DKK 0.85 pr. kg compared to same period last year.
The price on piglets has been as budgeted in the first 9 months of the year.
The sales prices for crops have in total been as budget.
The harvest yields for the winter crops have been as budgeted, whereas the spring crops in general have suffered during the drought. Especially the maize yields are negatively affected in Slovakia and West Romania, whereas East Romania has harvest yields in line with expected. All in all, the yields will result in a negative influence on the result with DKK 15 million.
The administration costs are increasing based on the expansion with activities in Hungary.
In Hungary, two building sites are purchased, which gives the possibility to establish a pig project with 4,000 sows incl. piglets.
Risk assessment
FirstFarms has in the annual report for 2016 described the most essential risks for the company, and it is the management's opinion that this description is still adequate. The annual report and the risk assessment can be found on the company's website www.firstfarms.com.
Accounting policies
The interim financial report is prepared in accordance with IAS 34 "Presentation of interim financial reports" as adopted by the EU and Danish disclosure requirements for listed companies.
Accounting policies are, except for the below mentioned, unchanged compared to the consolidated financial statement and annual report for 2016, to which is referred.
FirstFarms A/S has implemented the standards and interpretations, which become effective for 2017. None of these standards have affected recognition and measurement in 2017.
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
The consolidated financial statement and annual report for 2016 contains the full description of accounting policies.
Expectations for 2017
FirstFarms maintains the announced expectations about an EBIT result of DKK 18-22 million. The assumption is a stable price on piglets and a milk price in Q4, 2017 on the present level.
Financial calendar for 2018
27 March 2018 Annual report 2017
24 April 2018 Annual general meeting
29 May 2018 Interim financial report 1 January – 31 March 2018
23 August 2018 Interim financial report 1 January – 30 June 2018
27 November 2018 Interim financial report 1 January – 30 September 2018
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Management statement
The Management and Board of Directors of FirstFarms have today discussed and approved the interim financial report of FirstFarms A/S for the period 1 January – 30 September 2017.
The interim financial accounts, which has not been audited or reviewed by the independent auditors of the Company, has been prepared in accordance with IAS 34 – “Interim Financial Reporting” as adopted by the EU and additional Danish disclosure requirements for interim reports of listed companies.
In our opinion, the interim financial accounts give a true and fair view of the Group’s assets, liabilities and financial position at 30 September 2017 and of the results of the Group’s operations and cash flows for the period 1 January – 30 September 2017.
Further, in our opinion the Management’s review gives a true and fair overview of the development in the Group’s operations and financial matters, the results of the Group’s operations and the Group’s financial position as a whole.
Billund, 28 November 2017
Management
Anders H. Nørgaard
CEO
Board of directors
Henrik Hougaard
Chairman
Asbjørn Børsting
Jens Bolding Jensen
Bent Juul Jensen
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Income statement
| The Group | The Group | The Group | The Group | The Group | |
|---|---|---|---|---|---|
| DKK 1,000 | Q1-Q3 2017 | Q1-Q3 2016 | Q3 2017 | Q3 2016 | 2016 |
| Turnover | 134,786 | 89,820 | 68,410 | 50,972 | 130,257 |
| Value adjustment of biological assets | 5,735 | 6,132 | 2,223 | -4,476 | 8,789 |
| Production costs | -155,085 | -114,509 | -76,817 | -54,311 | -173,881 |
| Grants | 29,385 | 28,332 | 9,498 | 9,458 | 42,165 |
| Gross profit/loss | 14,821 | 9,775 | 3,314 | 1,643 | 7,330 |
| Other operating income | 3,983 | 223 | 1,286 | 11 | 867 |
| Administration costs | -9,487 | -8,208 | -3,211 | -2,299 | -10,461 |
| Other operating costs | 0 | -351 | 99 | -32 | -507 |
| EBIT result | 9,317 | 1,439 | 1,488 | -0,677 | -2,771 |
| Financial income | 162 | 323 | -22 | 211 | 269 |
| Financial costs | -7,572 | -6,845 | -2,806 | -2,330 | -10,019 |
| Pre-tax result | 1,907 | -5,083 | -1,340 | -2,796 | -12,521 |
| Tax on net profit | 307 | 877 | 244 | 167 | -436 |
| Net profit | 2,214 | -4,206 | -1,096 | -2,629 | -12,957 |
| Earnings per share, DKK | 0.43 | -0.89 | -0.21 | -0.56 | -2.75 |
| Diluted earnings per share, DKK | 0.34 | -0.89 | -0.21 | -0.56 | -2.75 |
Total income statement
| The Group | The Group | The Group | The Group | The Group | |
|---|---|---|---|---|---|
| DKK 1,000 | Q1-Q3 2017 | Q1-Q3 2016 | Q3 2017 | Q3 2016 | 2016 |
| Net profit | 2,214 | -4,206 | -1,096 | -2,629 | -12,957 |
| Other total income | |||||
| Items, which can be re-classified to the income statement: | |||||
| - Exchange rate adjustments by conversion of foreign units | -839 | 1,751 | -943 | 66 | 924 |
| - Tax of other total income | 0 | 0 | 0 | 0 | 0 |
| Other total income after tax | -839 | 1,751 | -943 | 66 | -924 |
| Total income | 1,375 | -2,455 | -2,039 | -2,563 | -13,881 |
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Balance
| The Group | The Group | The Group | |
|---|---|---|---|
| DKK 1,000 | Q3 2017 | Q3 2016 | 2016 |
| ASSETS | |||
| Non-current assets | |||
| Intagible assets | |||
| Goodwill | 16,011 | 16,042 | 16,007 |
| Land lease contracts | 2,681 | 3,901 | 3,542 |
| Total intagible assets | 18,692 | 19,943 | 19,549 |
| Tangible assets | |||
| Land and buildings | 322,949 | 264,246 | 263,528 |
| Plant and machinery | 75,361 | 69,061 | 66,604 |
| Fixtures and fittings, tools and equipment | 2,377 | 1,006 | 985 |
| Fixed assets under construction | 11,891 | 11,216 | 8,591 |
| Total tangible assets | 412,578 | 345,529 | 339,708 |
| Biological assets | |||
| Basic herd | 30,740 | 24,276 | 25,220 |
| Total biological assets | 30,740 | 24,276 | 25,220 |
| Other non-current assets | |||
| Deferred tax asset | 11,932 | 12,257 | 11,926 |
| Total other non-current assets | 11,932 | 12,257 | 11,926 |
| Total non-currents assets | 473,942 | 402,005 | 396,403 |
| Current assets | |||
| Inventories | 53,068 | 62,123 | 47,413 |
| Biological assets - breeding and crops | 59,747 | 45,192 | 43,498 |
| Receivables | 9,933 | 3,412 | 4,533 |
| Other receivables | 39,171 | 32,895 | 17,948 |
| Accruals and deferred expenses | 5,482 | 4,620 | 2,927 |
| Cash at bank and in hand | 1,332 | 1,341 | 2,793 |
| Total current assets | 168,733 | 149,583 | 119,112 |
| TOTAL ASSETS | 642,675 | 551,588 | 515,515 |
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
| The Group | The Group | The Group | |
|---|---|---|---|
| DKK 1,000 | Q3 2017 | Q3 2016 | 2016 |
| EQUITY AND LIABILITIES | |||
| Equity | |||
| Share capital | 51,376 | 47,122 | 47,122 |
| Reserve for exchange rate adjustment | -23,887 | -22,057 | -23,048 |
| Transferred result | 286,009 | 276,969 | 268,749 |
| Proposed dividend | 0 | 0 | 0 |
| Total equity | 313,498 | 302,034 | 292,823 |
| Liabilities | |||
| Non-current liabilities | |||
| Deferred tax | 9,532 | 8,304 | 7,177 |
| Credit institutions | 82,644 | 37,950 | 25,018 |
| Convertible bonds | 61,181 | 59,363 | 62,864 |
| Other non-current debt | 9,511 | 0 | 0 |
| Total non-current assets | 162,868 | 105,617 | 95,059 |
| Current liabilities | |||
| Credit institutions | 92,965 | 78,965 | 93,206 |
| Convertible bonds | 0 | 3,901 | 0 |
| Trade payables and other payables | 61,418 | 48,702 | 21,512 |
| Corporation tax | 0 | 0 | 801 |
| Accruals and deferred income | 11,926 | 12,369 | 12,114 |
| Total current liabilities | 166,309 | 143,937 | 127,633 |
| Total liabilities | 329,177 | 249,554 | 222,692 |
| TOTAL EQUITY AND LIABILITIES | 642,675 | 551,588 | 515,515 |
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Equity statement (Condensed)
| The Group | The Group | |
|---|---|---|
| DKK 1,000 | Q1-Q3 2017 | Q1-Q3 2016 |
| EQUITY STATEMENT | ||
| Equity 1 January | 292,823 | 306,173 |
| Result of the period | 2,214 | -4,206 |
| Other total income | -839 | 67 |
| Issuance of shares | 19,300 | 0 |
| Total income for the period | 20,675 | -4,139 |
| Equity 30 September | 313,498 | 302,034 |
Cash flow statement
| DKK 1,000 | The Group | The Group |
|---|---|---|
| Q1-Q3 2017 | Q1-Q3 2016 | |
| Pre-tax result | 1,907 | -5,083 |
| Cash generated from operations (operating activities) before changes in working capital | 21,294 | 15,654 |
| Cash flow from primary activities | 6,732 | -1,613 |
| Cash flow from operating activities | -1,510 | -8,397 |
| Cash flow from investing activities | -27,771 | -12,719 |
| Cash flow from financing activities | 28,031 | 22,615 |
| Total cash flow | -1,250 | 1,499 |
| Available, at the beginning | -90,413 | -78,731 |
| Exchange rate adjustment of available | 30 | -392 |
| Available at closing | -91,633 | -77,624 |
| Available at closing si recognised as follows: | ||
| Available funds | 1,332 | 1,341 |
| Current bank debt | -92,965 | -78,965 |
| Available at closing | -91,633 | -77,624 |
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Segment information
| Q1-Q3 2017
DKK 1,000 | Romanian activities | Slovakian activities | Hungarian activities | Total report compulsory segments |
| --- | --- | --- | --- | --- |
| Total segment turnover | 37,058 | 73,043 | 24,685 | 134,786 |
| Grants | 9,845 | 17,294 | 2,246 | 29,385 |
| Value adjustment of biological assets | 4,400 | 1,982 | -647 | 5,735 |
| Financial income | 131 | 0 | 176 | 307 |
| Financial costs | -2,738 | -3,472 | -1,141 | -7,351 |
| Depreciations | -5,178 | -12,610 | -1,489 | -19,277 |
| Segment result before tax | 598 | 985 | 5,773 | 7,356 |
| Segment assets | 205,396 | 348,840 | 87,393 | 641,629 |
| Plant investments *) | 13,758 | 10,334 | 5,715 | 29,807 |
| Segment liabilities | 163,446 | 237,594 | 71,875 | 472,915 |
*) Plant investments are investments in machinery, land and buildings.
| Q1-Q3 2016
DKK 1,000 | Romanian activities | Slovakian activities | Hungarian activities | Total report compulsory segments |
| --- | --- | --- | --- | --- |
| Total segment turnover | 32,628 | 57,192 | 0 | 89,820 |
| Grants | 8,436 | 19,896 | 0 | 28,332 |
| Value adjustment of biological assets | 3,400 | 2,732 | 0 | 6,132 |
| Financial income | 322 | 0 | 0 | 322 |
| Financial costs | -2,591 | -3,994 | 0 | -6,585 |
| Depreciations | -5,133 | -12,369 | 0 | -17,502 |
| Segment result before tax | 26 | -805 | 0 | -779 |
| Segment assets | 199,058 | 352,301 | 0 | 551,359 |
| Plant investments *) | 11,124 | 5,283 | 0 | 16,407 |
| Segment liabilities | 152,203 | 239,444 | 0 | 391,647 |
*) Plant investments are investments in machinery, land and buildings.
| Reconciliation of report compulsory segments result | Q1-Q3 | Q1-Q3 |
|---|---|---|
| DKK 1,000 | 2017 | 2016 |
| Segment result before tax for report compulsory segments | 7,356 | -779 |
| Non-allocated result, Group function | -5,449 | -4,304 |
| Result of continued operations before tax, cp income statement | 1,907 | -5,083 |
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Purchase of subsidiary
FirstFarms has in the accounting period purchased the shares in Dan-Farm Holding A/S, who runs pig production in Hungary.
The acquisition price constitutes DKK 9.4 million, and it is paid by issuance of shares in FirstFarms A/S.
The Group has paid the transaction costs of approx. DKK 0.3 million in connection with the trade.
The company is taken over at the end of March 2017, and there is only limited influence of the takeover in the operation of Q1, cp. the segment information above.
The below statement of the net assets is preliminary.
| DKK 1,000 | Recognised value at acquisition date |
|---|---|
| Tangible assets | 60,696 |
| Biological assets | 10,919 |
| Inventories | 1,611 |
| Receivables | 3,702 |
| Cash at bank and in hand | 4,996 |
| Credit institutions | -36,634 |
| Deferred tax | -2,546 |
| Trade payables | -4,993 |
| Other payables | -25,771 |
| Net assets taken over | 11,980 |
| Total acquisition price | 9,400 |
| Difference - recognised in other operating income | 2,580 |
Company announcement no. 18/2017 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Denmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund