ForFarmers announces strategy 2025

15 September 2020 - 08:49

Resilient in challenging home countries, expansion to new markets

Today ForFarmers N.V. (ForFarmers/the Company) introduces its strategy Build to Grow 2025 to analysts and investors during a Capital Markets Day. In the coming five years the Company will focus on further strengthening its market positions in existing home countries, by delivering innovative feed concepts that help farmers improve their returns on-farm in a sustainable way. To this end for instance, digitalisation of business processes will be further enhanced, both on-farm and internally at ForFarmers. In parallel, ForFarmers aims to grow by means of acquisitions in existing markets and in new growth markets, potentially outside of Europe. The objective is to be operational by 2025 in 7 countries, and have a more balanced portfolio between developing and mature markets. 

Solid financial ambitions with attractive dividend policy 
ForFarmers has determined the following financial ambitions for 2025, which are linked to the strategy: 

  • By 2025 an underlying EBITDA between €125 million and €135 million1, as a result of both like-for-like growth and acquisitions (2019: €88.5 million and H1 2020: €48.2 million);
  • Annual growth (like-for-like, i.e. excluding acquisitions) of underlying EBITDA by 0%-3%1 (as of 2020) in the challenging home countries;
  • Operational costs at least €10 million lower in 2025 compared to 2020;
  • A dividend policy, with a distribution of 40%-60% (was 40%-50%) of underlying net profit (after tax). 

At constant currencies

Build to Grow 2025: customer focused, innovative, efficient and sustainable
As the leading feed company in Europe, ForFarmers is an important link in the value chain that supplies food, including animal protein, to the growing global population. However, with the exception of Poland, the agricultural sector is experiencing growing pressure in the European home markets of ForFarmers. For example farmers are increasingly faced with extensive environmental measures to reduce phosphate and ammonia emissions by animals. Growth expectations for the agricultural sector in Northwest-Europe are consequentially very limited. On a global scale the feed market continues to grow and remain very large and offers opportunities for strong and innovative players such as ForFarmers, both for organic growth and for further consolidation. ForFarmers is already the leading feed company in Europe and aims to retain and enhance this position. 

With the strategy Build to Grow 2025, ForFarmers emphasizes its resilience in existing home countries and its ambition to expand to two carefully selected new growth markets, potentially outside of Europe. By being customer centric at the lowest possible cost ForFarmers believes it will make the difference in its home markets. The key to this is its Total Feed approach, aimed at helping farmers to achieve an optimal return on-farm, particularly in times of increasing environmental measures. This approach combines feed, with customized advice and is supported by monitoring tools. Innovative feed concepts and data-analysis are becoming more and more important, in making the agricultural sector more sustainable. ForFarmers is committing significant effort and resource to several programmes aimed specifically towards this. These include using more co-products from the food industry in animal feed for instance and improving the feed conversion (less feed, more output). Accordingly, ForFarmers is launching a tightened and ambitious sustainability policy, as part of the strategy Build to Grow 2025, with the objective to reduce its carbon footprint of the production of feed and animal protein. 

This press release contains information that qualifies as inside information in the sense of Article 7 paragraph 1 of the EU Market Abuse Regulation.

Capital Markets Day
Today ForFarmers presents the various elements of the strategy Build to Grow 2025 and the relating programmes during its Capital Markets Day. The presentations can be followed via a webinar (09.00 – 12.30 hours CET).  After the event the webinar will be posted on the corporate site.