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FirstFarms — Interim / Quarterly Report 2020
Aug 26, 2020
3433_rns_2020-08-26_8da3897c-d04b-4bcb-ba56-310e3a3ca468.pdf
Interim / Quarterly Report
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FirstFarms
Company announcement no. 22/2020
26 August 2020
Interim financial report for 1 January – 30 June 2020 for FirstFarms A/S
Reasonable half year still gives expectations of a record result for 2020
In the first half year of 2020, FirstFarms A/S has improved EBITDA by 39 percent compared to same period last year.
The increase is primarily due to the company in June 2020 acquiring the company AISM srl. (Now FirstFarms Agro North srl.) in Northwest Romania.
FirstFarms' operations have overall delivered slightly above budget before correcting for changes in the livestock, and although the individual farms in general have not been directly affected by COVID-19, the result is reasonable in light of the situation in which the farms have operated.
All in all, a satisfactory half-year, which with the acquisition in Northern Romania, expected sale of land in Western Romania over the next 7-10 months and an expectation of slightly higher prices for pigs and crops, means that FirstFarms maintains its expectations for 2020;
- An EBITDA result in the level of DKK 110-135 million
- An EBIT result of DKK 60-85 million
In 2019, an EBITDA of DKK 96 million an EBIT of DKK 48 million were realised, which was historically good. If the expectations for this year are met, 2020 becomes another record year for FirstFarms.
"Our ambition is develop into one of Europe's most well-run and attractive farms. It requires skilled and committed employees, an ambitious board of directors and a group of shareholders, who show confidence and support. And we have that," says CEO of FirstFarms, Anders H. Nørgaard, who are willing to reveal the formula for continued growth in the company:
"Based on Danish agricultural management, we must continue to acquire, develop and run agriculture with respect for the surrounding communities. We must continue to deliver products of the highest quality, which are primarily sold and consumed locally. Last but not least, we must continue to contribute to the development towards more sustainable agriculture and execute on new opportunities that create value for consumers and our investors."
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majemarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Summary
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 June 2020.
- FirstFarms has in the accounting period realised:
- A turnover of DKK 151.8 million
- An EBITDA result of DKK 65.4 million
- An EBIT result of DKK 39.8 million
-
A pre-tax result of DKK 28.8 million
-
EBITDA and EBIT are improved with DKK 18.2 million and DKK 16.8 million, respectively, compared to same period last year.
-
FirstFarms has in June 2020 purchased AISM srl. (Now FirstFarms Agro North srl.)
- FirstFarms Agro North owns 2,430 hectares of cultivated, leased agricultural land in Romania, a modern silo plant with 6,000 tons storage capacity, feed mill and storage- and office facilities.
-
In connection with the calculation of the values in the company, an added value of DKK 19.7 million has been realised compared to the purchase price. This surplus value is recognised in the income statement (see page 12-13).
-
Operation branches
- The milk price has been lower than budgeted, whereas efficiency and production has been better than expected.
- The prices for piglets and slaughter pigs have decreased during the first half year, but FirstFarms expects that the prices will increase again in second half year. In the first half year of 2020, there is a negative adjustment of the stock with DKK 9 million, compared to a positive adjustment in the first half year in 2019 of DKK 5.6 million.
- The harvest of autumn crops has all in all been lower than budgeted. Currently, the spring crops look satisfactory.
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.
About FirstFarms:
FirstFarms is a Danish stock exchange listed company, which purchases and operates agriculture in Eastern Europe. We develop the individual farms to modern businesses that deliver milk, meat and grains of the highest quality to the local food processing companies. FirstFarms contributes to, and approves, the development towards a more sustainable agriculture.
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – 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+Q2 | The Group Q1+Q2 | The Group Q2 | The Group Q2 | The Group | |
|---|---|---|---|---|---|
| DKK 1,000 | 2020 | 2019 | 2019 | 201 | 2019 |
Main figures
| Turnover | 151,845 | 108,480 | 69,282 | 52,915 | 328,072 |
|---|---|---|---|---|---|
| Gross profit/loss | 31,029 | 31,939 | -906 | 15,495 | 65,293 |
| Result before depreciations (EBITDA) | 65,422 | 47,223 | 42,037 | 34,687 | 95,551 |
| Profit/loss of primary operations (EBIT) | 39,759 | 22,922 | 25,602 | 11,012 | 48,400 |
| Net financial items | -10,926 | -7,097 | -5,452 | -4,104 | -19,429 |
| Pre-tax result | 28,833 | 15,825 | 20,150 | 6,908 | 28,971 |
| Net profit | 25,892 | 12,759 | 19,006 | 5,469 | 22,425 |
| Non-current assets | 961,835 | 635,520 | 961,835 | 635,520 | 849,274 |
| --- | --- | --- | --- | --- | --- |
| Current assets | 235,436 | 228,324 | 235,436 | 228,324 | 222,845 |
| Total assets | 1,197,271 | 863,844 | 1,197,271 | 863,844 | 1,072,119 |
| Share capital | 75,167 | 61,594 | 75,167 | 61,594 | 63,181 |
| Equity | 482,566 | 377,737 | 482,566 | 377,737 | 392,315 |
| Non-current liabilities | 491,099 | 305,492 | 491,099 | 305,492 | 433,085 |
| Current liabilities | 223,606 | 180,615 | 223,606 | 180,615 | 249,719 |
| Cash flow from primary operations | 44,845 | 19,028 | 19,528 | 23,795 | 100,958 |
| --- | --- | --- | --- | --- | --- |
| Cash flow from operations | 32,129 | 12,895 | 12,584 | 12,993 | 78,127 |
| Cash flow for investment, net | -28,435 | -11,791 | -19,744 | -7,638 | -85,761 |
| Of which for investment in tangible assets | -32,779 | 29,303 | -20,500 | -18,883 | -89,463 |
| Cash flow from financing | 216 | 9,042 | 5,095 | 5,923 | 7,062 |
| Total cash flow | 3,910 | 10,146 | -2,065 | 11,278 | -572 |
Key figures
| Gross margin | 20.4 | 29.4 | -1.3 | 29.3 | 19.9 |
|---|---|---|---|---|---|
| EBITDA margin | 43.1 | 43.5 | 60.7 | 65.6 | 29.1 |
| Operating margin | 26.2 | 21.1 | 37.0 | 20.8 | 14.8 |
| Solvency ratio | 40 | 44 | 40 | 44 | 37 |
| Earnings per share, DKK | 3.44 | 2.07 | 2.53 | 0.89 | 3.55 |
| Diluted earnings per share, DKK | 2.91 | 1.86 | 2.06 | 0.83 | 3.33 |
| Return on shareholders' equity | 11.8 | 6.8 | 17.4 | 5.8 | 5.9 |
| Average number of employees | 318 | 284 | 318 | 284 | 309 |
| --- | --- | --- | --- | --- | --- |
EBITDA = EBIT added depreciations of the period.
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – 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 June 2020
FirstFarms has in the accounting period realised a turnover of DKK 151.8 million, an EBITDA result of DKK 65.4 million, an EBIT result of DKK 39.8 million and a pre-tax result of DKK 28.8 million. EBITDA and EBIT have improved with DKK 18.2 and DKK 16.8 million, respectively, compared to same period last year.
In June 2020, FirstFarms purchased the company FirstFarms Agro North srl. (AISM srl.). In connection with the calculation of the values in the company, an added value of DKK 19.7 million has been realised compared to the purchase price. This surplus value is recognised in the income statement.
FirstFarms Agro North owns 2,430 hectares of cultivated, leased agricultural land in Romania, a modern silo plant with 6,000 tons storage capacity, feed mill and storage- and office facilities. Registration of 900 hectares of land in the company is pending.
In the first half year, the equity has increased by DKK 90.3 million, due to issuance of shares of DKK 73.6 million, a result of DKK 25.9 million, an exchange rate adjustment of DKK -8.5 million and adjustment of hedging instrument of DKK -0.7 million.
In the first half year, the milk price has been lower than budgeted, whereas the efficiency and production has been better than expected.
The prices on piglets and slaughter pigs have been higher than budgeted in Q1, but lower than budgeted in Q2, but in total above budget for the first half year. The prices seem to have stabilised on a lower level, and FirstFarms expects they will increase a little the coming months.
The harvest of autumn crops is finished. In total, the result has been lower that budgeted, but there are large differences between the company's geographical areas. The geographical spread of the land limits the negative influence. Currently, the spring crops look satisfactory.
The sale of the land in West Romania runs as planned and is expected carried out in tranches over the next 7-10 months (Company announcement no. 15/2020).
The operation and sales have to a minor extent been affected by consequences of COVID-19 or restrictions hereof.
Risk assessment
FirstFarms has in the annual report for 2019 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 unchanged compared to the consolidated financial statement and annual report for 2019, to which is referred.
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Expectations for 2020
FirstFarms maintains the announced expectations to 2020, latest adjusted upwards by company announcement no. 16 of 11 June 2020. The result will depend on the price development of milk, meat and grain for the rest of 2020. An EBITDA result in the level of DKK 110-135 million and at EBIT result of DKK 60-85 million is expected. In 2019, an EBITDA of DKK 96 million and EBIT of DKK 48 million was realised.
Financial calendar for 2020
25 November 2020 Interim financial report 1 January – 30 September 2020
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – 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 June 2020
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 June 2020 and of the results of the Group’s operations and cash flows for the period 1 January – 30 June 2020.
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, 26 August 2020
Management
Anders H. Nørgaard
CEO
Board of directors
Henrik Hougaard
Chairman
Asbjørn Børsting
Vice Chairman
Jens Bolding Jensen
Karina Boldsen
Bendt Wedell
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Income statement
| | The Group
Q1+Q2
2020 | The Group
Q1+Q2
2019 | The Group
Q2 2020 | The Group
Q2 2019 | The Group
2019 |
| --- | --- | --- | --- | --- | --- |
| DKK 1,000 | | | | | |
| Turnover | 151,845 | 108,480 | 69,282 | 52,915 | 328,072 |
| Value adjustment of biological assets | 1,851 | 15,078 | -906 | 4,127 | 4,714 |
| Production costs | -144,906 | -113,955 | -67,856 | -52,690 | -321,856 |
| Grants | 22,239 | 22,336 | 10,672 | 11,143 | 54,363 |
| Gross profit/loss | 31,029 | 31,939 | 11,192 | 15,495 | 65,293 |
| Other operating income | 20,235 | 2,064 | 20,233 | 1,053 | 6,203 |
| Administration costs | -11,505 | -11,081 | -5,823 | -5,570 | -22,632 |
| Other operating costs | 0 | 0 | 0 | 34 | -464 |
| EBIT result | 39,759 | 22,922 | 25,602 | 11,012 | 48,400 |
| Financial income | 126 | 1,711 | 108 | 438 | 2,367 |
| Financial costs | -11,052 | -8,808 | -5,560 | -4,542 | -21,796 |
| Pre-tax result | 28,833 | 15,825 | 20,150 | 6,908 | 28,971 |
| Tax on net profit | -2,941 | -3,066 | -1,144 | -1,439 | -6,546 |
| Net profit | 25,892 | 12,759 | 19,006 | 5,469 | 22,425 |
| Earnings per share, DKK | 3.44 | 2.07 | 2.53 | 0.89 | 3.55 |
| Diluted earnings per share, DKK | 2.91 | 1.86 | 2.06 | 0.83 | 3.33 |
Total income statement
| | The Group
Q1+Q2
2020 | The Group
Q1+Q2
2019 | The Group
Q2
Q2 2020 | The Group
Q2
Q2 2019 | The Group
2019 |
| --- | --- | --- | --- | --- | --- |
| DKK 1,000 | | | | | |
| Net profit | 25,892 | 12,759 | 19,006 | 5,469 | 22,425 |
| Other total income | | | | | |
| Items, which can be re-classified to the income statement: | | | | | |
| - Exchange rate adjustments by conversion of foreign units | -8,540 | -1,876 | 7 | -1,222 | -2,844 |
| - Recognition of hedging | | | | | |
| Instrument on equity | -873 | 0 | -415 | 0 | -2,633 |
| - Tax of other total income | 184 | 0 | 88 | 0 | 553 |
| Other total income after tax | -9,229 | -1,876 | -320 | -1,222 | -4,924 |
| Total income | 16,663 | 10,883 | 18,686 | 4,247 | 17,501 |
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – 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 | Q1+Q2 2020 | Q1+Q2 2019 | 2019 |
| ASSETS | |||
| Non-current assets | |||
| Intangible assets | |||
| Goodwill | 16,047 | 16,070 | 16,083 |
| Land lease contracts | 0 | 0 | 0 |
| Total intangible assets | 16,047 | 16,070 | 16,083 |
| Tangible assets | |||
| Land | 526,918 | 266,945 | 430,618 |
| Buildings | 228,291 | 192,639 | 211,543 |
| Plant and machinery | 105,240 | 101,539 | 103,856 |
| Fixtures and fittings, tools and equipment | 5,020 | 4,345 | 4,260 |
| Fixed assets under construction | 28,506 | 11,489 | 29,991 |
| Total tangible assets | 893,975 | 576,957 | 780,268 |
| Biological assets | |||
| Basic herd | 42,028 | 33,307 | 42,870 |
| Total biological assets | 42,028 | 33,307 | 42,870 |
| Other non-current assets | |||
| Deferred tax asset | 9,785 | 9,186 | 10,053 |
| Total other non-current assets | 9,785 | 9,186 | 10,053 |
| Total non-currents assets | 961,835 | 635,520 | 849,274 |
| Current assets | |||
| Inventories | 34,962 | 28,435 | 77,419 |
| Biological assets - breeding and crops | 137,200 | 128,576 | 82,288 |
| Receivables | 26,833 | 18,191 | 22,297 |
| Other receivables | 26,949 | 30,047 | 28,458 |
| Accruals and deferred expenses | 2,678 | 9,300 | 9,326 |
| Cash at bank and in hand | 6,814 | 13,775 | 3,057 |
| Total current assets | 235,436 | 228,324 | 222,845 |
| TOTAL ASSETS | 1,197,271 | 863,844 | 1,072,119 |
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – 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 | Q1+Q2 2020 | Q1+Q2 2019 | 2019 |
| EQUITY AND LIABILITIES | |||
| Equity | |||
| Share capital | 75,167 | 61,594 | 63,181 |
| Reserve for exchange rate adjustment | -36,897 | -27,389 | -28,357 |
| Transferred result | 444,296 | 343,532 | 357,491 |
| Proposed dividend | 0 | 0 | 0 |
| Total equity | 482,566 | 377,737 | 392,315 |
| Liabilities | |||
| Non-current liabilities | |||
| Deferred tax | 49,594 | 19,636 | 37,233 |
| Credit institutions | 250,934 | 155,976 | 252,739 |
| Convertible bonds | 118,988 | 129,880 | 88,895 |
| Other non-current debt | 71,583 | 0 | 54,218 |
| Total non-current assets | 491,099 | 305,492 | 433,085 |
| Current liabilities | |||
| Credit institutions | 118,075 | 109,829 | 121,055 |
| Convertible bonds | 3,229 | 0 | 33,322 |
| Trade payables and other payables | 83,111 | 60,368 | 75,269 |
| Corporation tax | 0 | 0 | 1,790 |
| Accruals and deferred income | 19,191 | 10,418 | 15,283 |
| Total current liabilities | 223,606 | 180,615 | 246,719 |
| Total liabilities | 714,705 | 486,107 | 679,804 |
| TOTAL EQUITY AND LIABILITIES | 1,197,271 | 863,844 | 1,072,119 |
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Equity statement (Condensed)
| DKK 1,000 | The Group | The Group |
|---|---|---|
| Q1+Q2 2020 | Q1+Q2 2019 | |
| EQUITY STATEMENT | ||
| Equity 1 January | 392,315 | 370,118 |
| Result of the period | 25,892 | 12,759 |
| Other total income | -9,229 | -1,876 |
| Issuance of shares | 73,588 | 0 |
| Dividend | 0 | -3,264 |
| Total income for the period | 90,251 | 7,619 |
| Equity 30 June | 482,566 | 377,737 |
Cash flow statement
| DKK 1,000 | The Group | The Group |
|---|---|---|
| Q1+Q2 2020 | Q1+Q2 2019 | |
| Pre-tax result | 28,833 | 15,825 |
| Cash generated from operating activities before changes in working capital | 38,405 | 26,527 |
| Cash flow from primary activities | 44,845 | 19,028 |
| Cash flow from operating activities | 32,129 | 12,895 |
| Cash flow from investing activities | -28,435 | -11,791 |
| Cash flow from financing activities | 216 | 9,042 |
| Total cash flow | 3,910 | 10,146 |
| Available, at the beginning | 3,057 | 3,628 |
| Exchange rate adjustment of available | -153 | 1 |
| Available at closing | 6,814 | 13,775 |
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Segment information
| Q1+Q2 2020
DKK 1,000 | Romanian activities | Slovakian activities | Hungarian activities | Czech activities | Total report compulsory segments |
| --- | --- | --- | --- | --- | --- |
| Total segment turnover | 9,380 | 83,079 | 28,637 | 41,191 | 162,287 |
| Grants | 6,099 | 13,878 | 1,026 | 1236 | 22,239 |
| Value adjustment of biological assets | -4,400 | 7,883 | -2,437 | 805 | 1,851 |
| Financial income | 10 | 73 | 11 | 32 | 126 |
| Financial costs | -2,758 | -3,867 | -1,461 | -794 | -8,880 |
| Depreciations | 7,136 | 15,178 | 1,417 | 1,909 | 25,640 |
| Segment result before tax | 11,002 | 16,845 | 6,573 | 1,154 | 35,574 |
| Segment assets | 362,318 | 601,282 | 93,991 | 144,287 | 1201,878 |
| Plant investments *) | 12,279 | 17,799 | 1,761 | 940 | 32,779 |
| Segment liabilities | 234,636 | 367,250 | 66,471 | 57,046 | 725,403 |
*) Plant investments are investments in machinery, land and buildings.
| Q1+Q2 2019
DKK 1,000 | Romanian activities | Slovakian activities | Hungarian activities | Czech activities | Total report compulsory segments |
| --- | --- | --- | --- | --- | --- |
| Total segment turnover | 8,315 | 40,805 | 21,594 | 37,765 | 108,479 |
| Grants | 8,030 | 11,419 | 1,974 | 912 | 22,335 |
| Value adjustment of biological assets | 0 | 8,011 | 2,927 | 4,140 | 15,078 |
| Financial income | 62 | 0 | 7 | 0 | 69 |
| Financial costs | -4,071 | 1,795 | -636 | -851 | -3,763 |
| Depreciations | 8,530 | 11,803 | 1,521 | 2424 | 24,278 |
| Segment result before tax | -556 | 5,695 | 6,775 | 6,846 | 18,760 |
| Segment assets | 248,925 | 372,508 | 92,825 | 149,863 | 864,121 |
| Plant investments *) | 14,554 | 10,847 | 2,507 | 1395 | 29,303 |
| Segment liabilities | 202,114 | 251,535 | 73,260 | 69,175 | 596,084 |
*) Plant investments are investments in machinery, land and buildings.
| Reconciliation of report compulsory segments result | ||
|---|---|---|
| DKK 1,000 | Q1+Q2 | Q1+Q2 |
| 2020 | 2019 | |
| Segment result before tax for report compulsory segments | 35,574 | 18,760 |
| Non-allocated result, Group function | -6,741 | -2,935 |
| Result of continued operations before tax, cp. income statement | 28,833 | 15,825 |
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
Turnover
| DKK 1,000 | Q1+Q2 | Q1+Q2 |
|---|---|---|
| 2020 | 2019 | |
| Sale of milk | 32,652 | 30,285 |
| Sale of cows and calves | 2,596 | 2,298 |
| Sales of piglets and slaughter pigs | 88,293 | 58,622 |
| Sale of corn etc. | 24,382 | 15,552 |
| Other turnover | 3,922 | 1,723 |
| Total | 151,845 | 108,480 |
Purchase of AISM srl.
FirstFarms A/S has, cp. company announcement no. 16 of 11 June 2020, purchased the Northwest Romanian company AISM Srl.
AISM Srl. owns 2,430 hectares of cultivated, leased agricultural land in Romania, a modern silo plant with 6,000 tons storage capacity, feed mill and storage- and office facilities.
Registration of the ownership of all the land in Romania is not yet been completed. This is standard in Romania due to the Romanian registration system. As a natural part of the transfer, FirstFarms is, together with a range of other initiatives, working on hedging the extent of this work and any problems connected therewith. It is done in close and good cooperation with the seller, who in the transfer agreement has assumed the usual guarantees for ownership to the land and any other conditions regarding AISM Srl. It is currently assessed not to result in adjustment of the purchase price. Any future adjustment will not affect the negative goodwill.
The sellers of AISM Srl. acquires 16.5 percent of the shares in FirstFarms A/S, as a result of the transaction, provided that shares are delivered in full for the contingent receivable. FirstFarms equity is strengthened with DKK 96 million – corresponding to fair value of the purchased assets.
The purchase price for the shares in AISM Srl. is calculated as 1,248,500 shares of DKK 71.40 per share, corresponding to DKK 76.7 million. The shares in AISM are paid with shares in FirstFarms, of which 50,000 shares are not issued, as they form part of the seller's guarantees.
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund
FirstFarms
The allocation of the purchase price of the net assets is shown in the table below:
| DKK 1,000 | Recognised value at take-over date |
|---|---|
| Land | 100,568 |
| Buildings | 11,031 |
| Machines + other plants | 2,359 |
| Inventories | 83 |
| Receivables | 359 |
| Cash at bank and in hand | 4 |
| Deferred tax | -12,574 |
| Other payables | -675 |
| Limited subsidies | -4,761 |
| Net assets taken over | 96,394 |
| Total acquisition price | 76,658 |
| Negative goodwill | 19,736 |
In connection with due diligence or later, there has not been identified need for provision to other conditions, including environmental obligations, which indicates that the negative goodwill can be assigned to unrecognised contingent liabilities.
The allocation of the purchase price is preliminary.
Recognised transaction costs of DKK 1.0 million have incurred in connection with the transaction.
Result before tax for AISM Srl. for the recognised period is DKK -0.1 million excluding recognition of negative goodwill. If all first half year of 2020 had been recognised, the result before tax for AISM would be DKK -0.8 million.
Company announcement no. 22/2020 for FirstFarms A/S
FirstFarms A/S
Majsmarken 1 – 7190 Billund – Danmark – Tel.: +45 7586 8787
www.firstfarms.dk – www.firstfarms.com – [email protected]
CVR no.: 28312504 – Registered office: Billund