DLG: Very satisfactory first half year 2017

In the first half of 2017, the Group realized a gross revenue of DKK 24.7 billion and a profit before tax of DKK 112 million. The interim EBITDA was DKK 604 million. This was better than in the first half of 2016 where the EBITDA of DKK 626 million was positively affected by DKK 50 million from net gains upon divestments of noncore business areas.

Profit after tax of DKK 69 million is considered satisfactory and was driven by improved earnings from underlying operations, exclusive nonrecurring items, compared with last year.

A decrease in the average debt for the first half year combined with continuing low interest rates resulted in the decrease in the Group’s net financial items.

Net working capital decreased with DKK 1 billion compared to first half of 2016 due to divestments and the continued focus on improvement of the individual business areas.

In the same period net interest-bearing debt increased due to a significant acquisition of shares in Team AG initiated for support of DLG Group’s future earnings after the last year’s noncore divestments.

The Group’s equity is also effected by the acquisitions of shares in Team and, in addition, that the Group’s hedging instruments had a positive impact on the equity in first half of 2016.

The three core business areas Agribusiness, Premix & Nutrition and Service & Energy continued to show positive improvements for the first half of 2017 in the Group’s main markets of Denmark and Germany.

The main business area, Agribusiness, delivered at a high level in Denmark and increased earnings in Germany and Sweden. The business area had a satisfactory first half with a focus on improving the existing business and optimizing the Roth Agrarhandel following the increased ownership in 2016. In first half of 2017, development also improved in the associate companies within Agribusiness with an increase in earnings.

Premix & Nutrition activities in the Vilofoss Group delivered an increase in earnings despite challenges on the Russian market. The increase is primarily driven by the Danish and German markets.

In addition, there are positive trends in the two growth markets, France and China, where DLG has high expectations to the opening of the cattle minerals plant in Rennes and the newly established partnership with Brdr. Ewers in China. Service & Energy activities again delivered an increase in operating earnings through the German activities in Team. The positive development derives from both the energy and construction market activities. We expect further growth supported by the acquisition of Egon von Haw and Carl Harms Mineralöle, which will increase the revenue in Team by DKK 1 billion.

The results from the Danish energy activities, through the coownership of DCC, improved further as a result of the acquisition of Dansk Fuel (Shell). The cooperation and earnings in the area continue to develop satisfactorily.

The Group’s flower activities in GASA Group delivered a result for the first half of 2017 on par with last year’s record earnings despite lower margins in the period.

Divestment of the Kongskilde agricultural machinery division in February 2017 as well as improved operations in the remaining business had a positive impact on the development in the Group’s interim results.

The expectations for the harvest and for the full year are positive, and an increase in profit compared to last year is expected. 

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