ForFarmers N.V. saw Total Feed volume increase 4.9 percent in 2018 to 10 million metric tons (mmt). Compound feed volume was up 4.2 percent to 7 mmt, mainly due to acquisitions.
Gross profit was up 5.6 percent to EUR443.4 million (US$501.4 million), 2.3 percent of which was from acquisitions, and 3.6 of which was like-for-like growth.
Underlying EBITDA was down 1.3 percent to €100.1 million, despite positive contributions from acquisitions. Underlying earnings per share were flat versus the prior year.
“2018 was a year of two sides for us,” said Yoram Knoop, CEO ForFarmers. “In terms of strategy, we made progress by, amongst others, acquiring four companies. Consequently, we are now operational in five countries and have more sales opportunities in the expanding poultry sector. Our portfolio segmentation across the various species is more in balance: volumes are more equally divided over the ruminant, swine and poultry sector. In 2018, we sold over 10 million tons of feed, the first European Total Feed company to do so. Our Total Feed approach enabled us in attracting new customers and achieving further growth among existing customers amid tough market conditions.
“Besides these positive developments we were, however, also confronted in the autumn of 2018 by the effects of the extraordinary warm and dry summer months, namely higher inbound logistics costs (low river levels) and more volatility in raw material prices, which we could not fully pass on to customers specifically in the Netherlands and Poland and which impacted our results.”
Knoop said, taking into consideration the 2018 results and mindful of the current market circumstances, the organization’s cost base would be reduced over the next two years by implementing extra group-wide efficiency plans.
“This will involve reducing the number of mills and headcount as a result of further standardization and optimization of our processes,” he said. “At the same time, we will continue to invest in our supply chain and in the introduction of innovative (digital) concepts for our customers.”