 aurigaindustries_annualreport2011_uk.pdf (3.8 MB)
Continued progress on objectives and strategic focus areas
Increase in revenue and earnings is in line with expectations at the beginning of the year after progress within all strategic focus areas. A positive development of the product portfolio has contributed to increasing the contribution ratio, while the fixed capacity cost ratio has been reduced. In 2011, foreign exchange rate developments had a negative impact on net financials and the results achieved. Both working capital and debt burden levels have improved, but the positive cash flow from operating activities of DKK 207 million was lower than expected at the beginning of the year.
- Revenue was up 2% at DKK 5,723 million (DKK 5,604 million) with growth being driven by new products. At unchanged exchange rates, organic growth of 8% has been achieved when excluding glyphosate revenue.
- The contribution margin is up 2.1 percentage points at 27.1% due to continued improvements to the product portfolio, while the average fixed capacity costs were reduced to 18.3% (18.7%) of revenue.
- The operating profit before depreciation and amortisation (EBITDA) improved, resulting in an EBITDA margin of 8.7% (7.3%). The operating profit (EBIT) was up DKK 103 million at DKK 318 million (DKK 215 million), while profit before tax was DKK 79 million (DKK 58 million).
- Financial items were up at DKK 240 million (DKK 172 million), primarily due to the negative exchange rate developments and higher interest-bearing debt and interest expenses.
- The average working capital relative to revenue has been improving since the start of 2010. Targeted efforts throughout 2011 resulted in a 1.8 percentage point improvement. The debt burden (NIBD/EBITDA) was reduced to 4.4 against 4.9 the year before.
OUTLOOK 2012
- Auriga will focus strongly on demonstrating continued growth in revenue and value creation through improved results in all strategic focus areas.
- The high debt and the need to improve cash flow highlight the necessity of the right balance between growth, cost development, working capital and debt.
- The market for crop protection products is expected to develop positively in 2012 with slightly increasing prices as high crop prices continue to offer an incentive for farmers to protect their crops.
- A further strengthening of the product portfolio with new and differentiated products is expected to result in growth at least on a par with market growth.
- In 2012, Auriga thus expects to return revenue of approx. DKK 6,000 million with an earnings margin (EBITDA) of approx. 10% and an operating profit (EBIT) of DKK 350-450 million.
The Board of Directors proposes to the annual general meeting on April 11, 2012, that no dividend be paid for 2011. The background is a wish to reduce the debt and safeguard future development opportunities for the purpose of long-term value creation.
Read more on www.auriga-industries.com.
March 15, 2012
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