17 December 2018 - 06:59
Following the third quarter 2018 trading update, which was published on 1 November, ForFarmers announces that the underlying EBITDA in 2018 will show a modest decline compared to 2017.
As was already indicated in the third quarter trading update, the effects of the hike in raw material and energy prices could not immediately be passed on to customers and ForFarmers faced higher inbound logistics costs, particularly in the Netherlands and Germany, due to low water levels. Both these effects also impact the results of the fourth quarter of 2018. In the second half of the year, ForFarmers’ share in the higher inbound logistics costs amounted to €2 million, which were not passed on to customers. Recently, the waterways have become navigable again and all mills that are located on a river or canal can again be reached by vessel.
As was mentioned in the trading update, the integration of the four acquisitions1 leads to extra costs. It is expected that these integration activities, and their related costs, will last for approximately 12 months from the date of acquisition.
As of its listing in 2016, ForFarmers has been providing a medium term guidance, of an on average annual increase in underlying EBITDA, in the mid-single digits at constant currencies, excluding the impact of significant acquisitions (e.g. Tasomix) and barring unforeseen circumstances. Due to the volatility of energy and raw materials prices, ForFarmers’ results may deviate from its average guidance in any given year.
The Annual Results 2018 of ForFarmers will be published on 13 March 2019.
(1) The acquisitions in Q3 are Tasomix (Poland) and Maatman (the Netherlands), and in Q4 Voeders Algoet (Belgium) and Van Gorp Biologische Voeders (the Netherlands, Belgium)