Isagro sales up 7% in 2015

Isagro’s revenues increased by 6.9% to €156.0 million in 2015, mainly thanks to higher sales in Italy and in India. The EBITDA recorded a 56% increase to €19.5 million versus €12.5 million of 2014.

The increase of EBITDA, direct consequence of turnover increase, was made possible by an increase in margins from the direct exploitation of the Intellectual Property of Isagro (sales ofproducts and services) for 2.5 Euro million, with higher sales in Europe which off-set lower volumes in the Americas; this, even within a crop protection market that in 2015 decreased by 8.5% versus 2014 in USD terms because of adverse climatic conditions, lower prices of the main agricultural commodities and, in the important Brazilian market, also a difficult financial context. In such a frame, benefits from the weakening of the Euro versus US Dollar only partially off-set, at the EBITDA level, the negative impact of price reduction; higher proceeds from third parties’ agreements, aimed at the indirect exploitation of the Intellectual Property of Isagro, for 5.0 Euro million.

With reference to the second point, it is reported that the new broad spectrum fungicide belonging to the SDHI class – found by Isagro Research Center and being co-developed with the North American company FMC Corporation – has already generated in 2015, albeit with a planned launch at the end of 2020 and with significant revenues from 2021/2022, proceeds for 5 Euro million, totally cashed-in in December, in relation to the Licensing to the same FMC of co-exploitation rights of Isagro in North America. This deal, on top of leading to higher royalties for Isagro at the time of sales by FMC, confirms, given the distance from the market launch, the significant commercial potential of this new product, with an efficient technical profile in terms both of effectiveness and eco-toxicology.

Outlook

With regards to the expectations of the consolidated turnover evolution of Isagro, in the short term (current year), it shall depend by the normalization of climatic conditions in particular in the North American, South American, Indian and Italian markets, towards which Isagro is particularly exposed, also in light of the stocks within distribution channels at the beginning of the year; in the mid-term (by 2020), it will be affected by the continuation of the implementation of the Strategic Lines of Isagro and new initiatives currently underway (discovery of new molecules and value extraction from the same and other IP mostly through agreements with third parties, growth in the Biosolutions business, opportunistic development of off-patented products, expansion of global commercial organization), with a confirmation of the target of 200 Euro million revenues at a consolidate level, to which are associated satisfactory profitability profiles.