DLG continues the growth: Delivers best half-year results to date

In the first half of 2021 the DLG Group had a turnover of EUR 3.5 billion, which is an increase of EUR 123 million compared to the first half of 2020. The operating profit (EBITDA) was EUR 119 million compared to EUR 104 million in the same period last year. Profit before tax landed at EUR 40 million, against 24 million in 2020.

“We are coming out of the first half of the year with an increase in earnings, which is driven by success within our Agribusiness activities in Denmark and in Germany, as well as in our large German energy and DIY store business, Team SE. In addition, the good pace from last year continues within our global Premix & Nutrition business, and across all countries the group's employees have once again delivered a power performance. All in all, it is a very satisfactory result that we have created in a somewhat challenging first half of the year,” says Kristian Hundebøll, referring to the Covid-19 pandemic, large price fluctuations in the grain and raw materials market and supply uncertainty, especially in building materials.

“We are well under way with the last year of this strategy period, and now we are seeing the results of the strategic direction we decided back in 2017. Our three business areas, which are exposed to the food, energy and DIY store sectors, have over all delivered very satisfactory results,” says Kristian Hundebøll.

Agribusiness

The DLG Group's Agribusiness companies had an increase in earnings of 23 % compared to the same period last year.

“We are seeing a positive trend across the board and have had a good start to the year within our Agribusiness activities. Also, we are experiencing progress in both Denmark and Germany, which is primarily driven by a good spring within plant breeding and the sale of compound feed. In Denmark, we are also beginning to see the positive effect of the new strategic direction we set for the Danish business last year, in which we sharpened our focus on customer needs and made a number of organizational changes, which all in all should give customers a better experience when trading with DLG,” says Kristian Hundebøll.

In the first half of the year, Danæg delivered good earnings compared with the previous year, which was affected by the lack of sales to the foodservice sector. The large strategic investment in Finland has yielded a good return and has positioned Danæg as the Nordic region's largest egg group.

Premix & Nutrition (Vilofoss)

The group’s vitamin and mineral business has also seen a positive development in the first six months of the year, where earnings increased by 19 % compared to the first half of last year.

“We generally see a good development in several of our core markets, and in Denmark and France in particular. At the same time, we experience strong sales of the product portfolio we call Leading Products, which are special products that promote food safety and hygiene. We see a large demand from export markets such as USA, Canada and Australia, where great emphasis is placed on the high quality of the products,” says Kristian Hundebøll.

After several years of successful cooperation in Russia, DLG and Alltech in February entered into a joint venture on the Finnish market with the acquisition of a mineral factory in Finland and sales to the Finnish market. A collaboration that has had a very satisfactory start. In this autumn, the first sod will be cut for what will become one of Europe's most advanced specialty factories within livestock nutrition in Brædstrup, Denmark, where vitamin and mineral products will be produced for the Danish domestic market.

Energy & Retail

In the first half of the year, the Energy & Retail business area saw an increase in earnings of 6 % compared to the same period last year. The German corporation Team SE continues a growth of earnings at a high level.

"We are profiting from the boom we are currently seeing within construction in Germany, where it is expected, that there will be invested a larger three-digit billion in euros over the coming years.

We have a strong structure within our construction activities, where demand is constantly increasing, and we differentiate ourselves in the market with a focus on consulting and ready-made concepts in the western part of Germany. In our German energy business, we have had lower fuel sales at our petrol stations due to the Covid-19 restrictions in Germany. On the other hand, we have had improved earnings margins and have also had a large increase in sales of electricity and natural gas,” says Kristian Hundebøll.

The Danish energy business, which is run jointly with DCC, and the Land & Fritid chain stores have also delivered very good results.

Sustainability

With the group's plan for sustainable solutions, which was presented in February, DLG has put a clear line under that the business of the future must have an unambiguous sustainable footprint that benefits both customers, owners, and the outside world.

"We are of the opinion that concrete action is needed when we talk about sustainability. Therefore, in a relatively short time, we have launched several projects, all of which have both a sustainable and commercial profile. For example, we have got a good start in the production of grass protein at our green biorefinery in West Jutland. In Germany, we have opened a hydrogen filling station, and we are also a co-investor in the establishment of a high-tech plant for the production of pea protein for human nutrition. Furthermore, we are a partner in a project where the goal is to create a specific product that can reduce methane emissions from cows,” says Kristian Hundebøll.

Expectations for the full year

In several places, harvest is already well underway, and it is, as usual, the most important time of the year in the DLG Group. Although it is too early to predict the final yield of the harvest, it seems to be a reasonable harvest in northern Europe.

"In relation to the harvest, there is a prospect of a good harvest with yields that are around the average of recent years. Based on this it is our goal that we must at least achieve an operating profit (excluding depreciation), which is on a par with last year, where we delivered the group's best annual results to date,” says Kristian Hundebøll.