AgroPages-Vilmorin & Cie sales up 3.5% in Q3 FY2019-Agricultural news

Significant business growth at the end of the third quarter 2018-2019: +3.5% on a like-for-like basis
Confirmation of objectives for 2018-2019

Closing on March 31, sales at the end of the third quarter for fiscal year 2018-2019, corresponding to revenue from ordinary activities, came to 1,002 million euros, up by 1.4% with current data and 3.5% on a like-for-like basis compared with March 31 of the previous fiscal year.

Consolidated financial information is established in compliance with the IFRS reference (International Financial Reporting Standards), as adopted by the European Union on March 31, 2019. It takes into account the application of IAS 29 with regard to the treatment of hyperinflation in Argentina.

Sales for the third quarter 2018-2019 up by 3.3% on a like-for-like basis, marked by a confirmed upturn in business for vegetable seeds and a fine performance by field seeds

Vegetable Seeds division: marked increase in sales over the third quarter

Over the course of the third quarter, the Vegetable Seeds division achieved clear growth in sales (198.7 million euros. +3.5% on a like-for-like basis). The best performances were recorded for several strategic crops, primarily pepper, summer squash and, particularly in China, carrot.

Concerning geographical regions, sales increased significantly in Europe, particularly Western Europe, and rebounded sharply in South America and the Middle East, in spite of exogenous factors (geopolitical context and exchange rates) which continue to disturb commercial activity in these regions.

At the same time, in the African region, business was hit by tenser market conditions this year in the Maghreb. Furthermore, even though they were affected by a one-off drop in certain market segments, performances in North America confirmed that the inventory levels with distributors is healthier, with a return to growth for this major continent this fiscal year.

Consequently, aggregate sales for the Vegetable Seeds division on March 31, 2019 came to 437.9 million euros, down by 0.4%. Restated on a like-for-like basis, business increased by 1.9%. Within vegetable seed markets whose evolution remains contrasted depending on geographical regions, Vilmorin & Cie thus continues to consolidate its commercial positions, reinforcing its rank as a world leader in vegetable seeds.

At the end of a third quarter marked by a clear upturn in business, Vilmorin & Cie maintains its objective for sales growth for Vegetable Seeds for fiscal year 2018-2019, namely an increase of 2% to 3% on a like-for-like basis compared with 2017-2018.

Field Seeds division: appreciable growth over the quarter, confirming the fine performance of European activities

Business grew (317.4 million euros. +2.6% on a like-for-like basis) for Field Seeds over the course of the third quarter, in spite of unstable agricultural markets.

In Europe, sales for the quarter for Field Seeds increased significantly (300.8 million euros. +3.4% on a likefor-like basis), confirming Vilmorin & Cie’s capacity to reinforce its commercial positions globally by the end of the fiscal year.

- There was fine growth in the sales of corn seeds, while the acreage devoted to this crop should begin to increase again this year. Business increase was strong in Western and Central Europe, resulting in market share gains; at the end of March this increase also included early sales in the United Kingdom, as a direct result of Brexit.

- As for sunflower seed sales, they remained stable. In the context of a slight drop anticipated for the cultivated acreage of this crop, orders are still looking satisfactory, in spite of certain orders being somewhat late, particularly in Russia.

In South America, the third quarter (13.8 million euros) posted a sharp drop in business. In Brazil, following on from the first semester, the commercial campaign for safrinha corn was hit by strong competitive pressure on prices. Volumes sold were down significantly, reflecting Vilmorin & Cie’s decision to defend its pricing policy while improving its margins levels. At the same time, soybean seed sales in Brazil and corn seed sales in Argentina continued to grow strongly.

Moreover, the integration of the companies Sursem (Argentina) and Geneze (Brazil), whose acquisition was finalized in December 2018, is advancing according to plans.

As a consequence of this third quarter, aggregate sales for the Field Seeds division on March 31, 2019 came to 526.4 million euros, an increase of 2.8% compared to the same period for the previous fiscal year; on a like-forlike basis, there was a significant increase of 4.9%.

On these bases, Vilmorin & Cie can confirm its objective for an increase in sales for Field Seeds for fiscal year 2018-2019, an increase of between 2% and 3% on a like-for-like basis compared with the previous fiscal year.

Moreover, with regard to associated companies:

On the North American market, AgReliant’s sales for the third quarter were markedly down. Indeed, this year business has been affected in certain distribution channels by the deployment of the new commercial strategy, particularly because of a major brand reorganization.

On the African market, Seed Co posted a strong increase in its sales once again this year, confirming its position as the number one African seed company.