DLG continues growth journey and delivers record results

“The increased earnings are attributable to the strategic shift marked by our Leading the Way strategy, which we presented in 2017. The figures testify to a healthy and solid business portfolio, where all areas contribute to the great results. I’m particularly pleased with our clearly improved earnings capacity, which we have now significantly strengthened for the fourth year in a row. We expect this trend will continue in the coming years,” says CEO Kristian Hundebøll.

The German market continues to contribute significantly to both the top and bottom lines of the DLG Group. With revenue of EUR 5.1 billion, DLG has achieved top-line growth of EUR 735 million and 12 per cent earnings growth in Germany alone. This should be seen in the light of rising raw materials and energy prices.

Based on the historically good results, DLG can pay a historically high dividend to its Danish owners of EUR 23 million, which is an increase of 28 per cent compared to 2020. This corresponds to a return on the contributed capital of 13 per cent. 

Agribusiness

Revenue from the DLG Group’s Agribusiness was up EUR 461 million at EUR 4.8 billion. EBITDA was EUR 150 million, which represents a 17 per cent increase compared to 2020.

Overall, all the main markets in the Baltic Sea region, including Germany, did better in 2021 than the previous year, primarily driven by satisfactory growth in Denmark, the Baltics and Poland in particular. In Sweden, earnings expectations were met, while the German market was challenged due, among other factors, to a declining demand for compound feed for livestock production. All markets saw a significant increase in earnings from sales of plant-related products, strengthening the DLG Group’s market position as Europe’s largest supplier in this field.

Harvest yields for the year were greatly impacted by considerable regional variation in terms of both quality and quantity, which contributed to the increase in demand from both European and overseas markets in the second half of the year. Despite a 5 per cent decrease in total grain supplied by farmers in 2021, the DLG Group succeeded in maintaining the high exports realised in 2020, shipping 4.1 million tonnes of grain out of the group’s large port terminals in Germany, Denmark, Sweden and the Baltics.

“2021 was marked by large price fluctuations in global markets and bottlenecks in the supply of raw materials. It was a turbulent year, but we have focused on keeping up supply to our customers, and we have succeeded in this. Against this background, we can only be happy with the great results delivered by our Agribusiness,” says Kristian Hundebøll.

Premix & Nutrition

Vilofoss Group is again delivering record results and growth in most markets. Based on revenue of EUR 452 million, EBITDA of EUR 25 million was posted, corresponding to a 6 per cent increase in earnings. 

“Developments have been good in several of Vilofoss’ core markets and especially in Denmark and France, where our performance is impressive. Moreover, the Leading Products portfolio is doing well. The portfolio comprises products that promote productivity as well as the health and welfare of livestock. We’re seeing an increase in demand from export markets such as the USA, Canada and Australia, where the high quality of the products is greatly valued,” says Kristian Hundebøll.

Energy & Retail

The Energy & Retail business area has delivered strong results in recent years – and 2021 was no exception. In 2021, the business area posted revenue of EUR 2.7 billion compared to EUR 2.2 billion in 2020. EBITDA was EUR 129 million, which represents a 10 per cent increase on 2020.

“Our German subsidiary, Team, is a very strong growth engine for the entire group and contributes 36 per cent of our total operating profit. Team is one of the largest companies in Germany within sales of energy and building materials, and in 2021 we further expanded our market position in north-western Germany. Our building materials business had a particularly good year, and customers are rewarding us for the high level of our advice, our security of supply and our quality concepts. We see considerable long-term earnings potential in this business area,” says Kristian Hundebøll.

In September, DLG announced the merger of Team with the group’s German agribusiness company, HaGe. Headquartered in Flensburg, the merged company will have more than 4,300 employees and generate revenue of more than EUR 5 billion. It will thus be one of the largest companies headquartered in Schleswig-Holstein and the largest Danish-owned company in Germany. 

“With the merger, we have created a business model in our largest market that matches those of our competitors. It gives us a good starting point for further expanding our position in Germany, while at the same time creating strong synergies across the group,” says Kristian Hundebøll.

2022: New strategy to set the course for future growth

This year, DLG will embark on a new group strategy, which will be presented in the spring. The strategy will set the course for the group’s development in the coming years. 

“2021 was a year in which we also made major and targeted investments in the green transition, which must be integrated into our commercial business. In the new strategy period, we will continue down this road, building on the foundation we created with Leading the Way and at the same time focusing even more keenly on creating the solutions needed to support the sustainable transition. In 2022, we expect revenue and earnings on a par with 2021. That said, we are, of course, keeping a close eye on developments in the geopolitical situation and the raw materials markets, which might affect the prerequisites we have based the budget on,” says Kristian Hundebøll.

See the Annual Report 2021 here