Stockholm / SE. (lg) Lantmännen´s result after financial items for the first four months amounts to 238 million SEK – compared with 38 million SEK the previous year. The improved result is primarily due to improvements in the Agriculture and Energy sectors. All sectors are developing as planned. «Lantmännen´s result for the first third of the year has increased by 200 million SEK, which is of course pleasing to report. Our businesses are developing well, and we have taken several steps to both improve our existing businesses – and to create growth in new areas», says Per Olof Nyman, Lantmännen´s CEO and Group President. All figures below are adjusted for items affecting comparability. Last year´s results in brackets.
The Agriculture Sector´s result is considerably higher than the previous year: 23 million SEK (minus 53). The effects of the improvement and efficiency efforts that were made in 2014 are evident: not only in the higher result, but also in the form of a more customer and service-oriented organization. Competition in the agricultural market remains fierce however, and the work to achieve cost leadership continues as planned.
The result for the Machinery Sector is on the same level as last year: four million SEK (three). The tractor market in Sweden, Norway and Denmark has continued to decrease. Meanwhile, the market for construction equipment in Sweden has stabilized somewhat, but several infrastructure projects remain delayed, and demand from the mining sector is still weak. Lantmännen´s sales of agricultural machinery have developed better than the market average, and Swecon has strengthened its market share in Sweden during the first third of the year.
The Energy Sector has significantly increased its result compared to the previous year: 62 million SEK (minus 13), mainly within Lantmännen Agroetanol due to the improvement program that was implemented in 2014 and has had the desired effect. The biggest earnings improvement, however, is due to increased sales in Germany, where new financial instruments for biofuels has led to increased demand for Lantmännen´s climate-friendly ethanol – and due to a higher market price of ethanol.
The Food Sector´s result is on par with the previous year: 137 million SEK (146). Last year´s result includes a 17 million SEK contribution from Scandi Standard; adjusted for this difference, the sector´s operating result is actually higher than the previous year. Lantmännen Cerealia has completed its work with reviewing the milling structure in Mälardalen; an investment will be made to concentrate operations to Strängnäs. Lantmännen Unibake has increased sales in most markets, and further improved its result. The potential for further growth is good, not least due to the acquisition of the Finnish bakery group Vaasan, which was completed on June 01. The deal means that Lantmännen expands its product portfolio with a number of strong brands, and strengthens its presence in several markets in the Baltic Sea region.
Real Estate Sector
Lantmännen Real Estate´s result, excluding property sales, is slightly higher than the previous year: 62 million SEK (54). A number of property transactions have been made during the first four months of 2015, and two major leasing deals have been completed, in Örebro and Kristianstad.
Continuing to invest in the future
«Several initiatives to increase the value creation the in the grain value chain continue as planned. One example is that Lantmännen has developed a new cultivation method, which is positive for the climate and environment – and produces grain with as much as a 20 percent decrease of the climate impact. Lantmännen has also acquired a majority holding in CropTailor, a Swedish biotech company that has developed a technology to quickly and with great precision refine oats», says Per Olof Nyman.
Lantmännen has achieved its overarching climate goal – six years earlier than anticipated. Since 2009, Lantmännen´s total carbon dioxide emissions have been reduced by more than 40 percent. The climate work continues, particularly with transports as a priority area for the future within Lantmännen. «We have had a great start to 2015, and I look forward to the rest of the year with great confidence», concludes Per Olof Nyman.