Conference Call 1st - 3rd quarter 2019/20
13 January 2020
Joachim Lutz, CEO Dr. Stephan Meeder, CFO
Highlights
- Market and political environment
- DE: National climate protection law and emission trading system
- Development of market volume and prices
- Development of CropEnergies Group
- Steady capacity utilization with usual maintenance periods
- Financials 1st - 3rd quarter 2019/20
- Operating profit 70 (19) M€
- High demand and prices for renewable, sustainable ethanol
- Confident outlook for remaining FY 2019/20
Annual average global temperatures
from 1850-2018
using Data from UK Met Office
Prof. Ed Hawkins, University of Reading
Source: https://showyourstripes.info/
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 2 |
DE: National climate protection law and emission trading system adopted
- National Climate protection law
- Binding statutory emission limits for all sectors
- Transport: reduction from 150 Mt CO2eq in 2020 to 95 Mt CO2eq in 2030
- National emission trading system
- Applicable on fossil fuels in transport and heating
-
2021 to 2025: "fixed price period" - political agreement to start with 25 €/t
CO2 gradual increase to 55 € until 2025 - From 2026 on: auctioning of CO2 certificates
- Call for additional measures to achieve goals:
- Increase GHG target from 6% (2020) to 16% (2030)
- Reform of energy tax from volume (litre)-base into CO2-pricing
GHG emissions in Germany
- reality and targets [Mt CO2eq]
1,000 | 866 | Transport | |||
813 | Other Non-ETS* | ||||
800 | Energy | ||||
196 | |||||
186 | Industry | ||||
600 | 311 | 543 | |||
280 | 140 | ||||
400 | |||||
175 | |||||
197 | 197 | 375 | |||
200 | 133 | ||||
162 | 150 | ||||
0 | 95 | ||||
2018 | 2020 | 2030 | 2040 | ||
* in particular: buildings, agriculture, w aste |
GHG emissions from fuels
[kg CO2eq/liter]
4 3.4
3.0
32.7
2 | 2.8 | 2.3 | 2.1 |
1 | 0.3 | ||
0.7 | 0.7 | ||
0 | 0.7 | ||
combustion | upstream | |
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 3 |
Market - E10 availability increases
- Increasing blending obligations in EU countries in 2020
- 6% GHG-target 2020 requires more non-fossil alternatives
- RED II: 1G cap max 7% but not more than 2020 + 1%
- EU market 2020e [M m³]
Production: | 5.3 +2% (add. 2.4 non-fuel) |
EU sales fuel ethanol [M m3]
8 | Other EU | Germany | ||||||||||
6 | France | UK | ||||||||||
0.8 | 0.7 | 0.8 | ||||||||||
0.9 | ||||||||||||
4 | 0.9 | 0.9 | ||||||||||
1.5 | ||||||||||||
1.5 | 1.5 | |||||||||||
2 | 2.3 | 2.5 | 2.7 | |||||||||
0 | ||||||||||||
2018 | 2019e | 2020e | ||||||||||
Source: F.O. Licht
Consumption: 5.9 +6% (add. 2.6 non-fuel)
E10 availability across Europe
- E10 available in more European countries
- In the Netherlands since 1 Oct 2019
- Slovakia, Hungary and Denmark as of 1 Jan 2020
- 2020 plans: Austria, Lithuania, Latvia
Source: ePURE
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 4 |
Market development: prices
Higher ethanol and lower raw material prices in 1st - 3rd quarter | European ethanol prices [€/m3] | ||||
| Ethanol*: € 605 (475) /m3 | ||||
700 | |||||
| Grain**: € 178 (187) /t | ||||
600 | |||||
Feedstock supply 2019/20 | 500 | ||||
| Unchanged EU biomass situation: starch long, protein short | ||||
Net imports protein sources: 42 Mt, net exports starch sources: 16 Mt | 400 | FY 17/18 | FY 18/19 | FY 19/20 | |
Stagnating/shrinking farm acreage in the EU |
- EU grain harvest: 316 Mt (+9%)
European wheat prices [€/t]
Exceeds demand of 290 Mt by 9% | 225 | |||||
Increase of ending stocks by 21% to 57 Mt | 200 | |||||
| World grain harvest***: 2,162 Mt (+1%) | 175 | ||||
1% below demand of 2,188 Mt | 150 | |||||
| Ending stocks 594 Mt (-4%) | 125 | FY 17/18 | FY 18/19 | FY 19/20 | |
* Ethanol T2 FOB Rdam ** Wheat (Euronext Paris), next date of expiry *** all varieties, except rice
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 5 |
Developments in the CropEnergies Group
- Q1-Q3:Ethanol production 729 (771),000 m3 (-5,5%)
- Ethanol production in Q3 lower than last year 251 (277),000 m3 due to planned maintenance
- Progress in CropEnergies' biorefinery concept
- Enhanced CO2 liquefaction further reduces process emissions
Ethanol production [1,000 m3] | |
800 | |
771 | 729 |
400 | |
0 | |
Q1-Q3 18/19 | Q1-Q3 19/20 |
- Extension of residue based ethanol production/feedstocks
- Co-operationin protein based meat replacer
- Growth in neutral alcohol specialities
Product mix Q1-Q3 19/20 [by weight of dry matter]
fuel | non-fuel |
43% | 57% |
Note: non-fuel includes protein-rich food and feed, neutral alcohol, liquefied CO2
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 6 |
Highlights 9M 2019/20
- Ethanol production
- Revenues
- EBITDA
- Operating profit
- Net earnings
- Net financial assets (vs. 28 Feb 2019)
729 (771) ,000 m³ | - 6% |
667.6 (596.1) million € | + 12% |
101.9 (48.5) million € | + 53 million € |
70.3 (19.1) million € | + 51 million € |
50.2 (12.9) million € | + 37 million € |
89.7 (26.9*) million € | + 63 million € |
*incl. adjustments from IFRS 16
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 7 |
Revenues
(in € million) | 9M 19/20 | 9M 18/19 | ||||||||
Revenues | 667.6 | 596.1 | + 12% | |||||||
EBITDA* | 101.9 | 48.5 | > + 100% | |||||||
Margin | 15.3% | 8.1% | - | |||||||
Depreciation* | -31.6 | -29.3 | - 8% | |||||||
Operating profit | 70.3 | 19.1 | > + 100% | |||||||
- Production decrease by 6%
- Production capacity utilisation adjusted to suit market conditions and to carry out regular maintenance activities
- Increase in revenues due to significantly higher sales prices for ethanol
- Average ethanol price**: € 605/m3 (€ 475/m3 in previous year)
Revenues / Production | |||
1,000 | [M€ / 1,000 m3] | ||
847 | |||
771 | |||
800 | 729 | ||
600 | 679 | 596 | 668 |
400 | |||
200 | |||
0 | |||
9M | 9M | 9M | |
17/18 | 18/19 | 19/20 | |
Revenues 9M 2019/20 |
78%
21%
1%
Ethanol Food and animal feed products Other revenues
*without restructuring costs and special items **ethanol FOB Rotterdam
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 8 |
EBITDA
120 | EBITDA [M€] | |||||||
9M 19/20 | 9M 18/19 | |||||||
(in € million) | 102 | |||||||
Revenues | 667.6 | 596.1 | + 12% | 90 | 88 | |||
Overall performance | 651.2 | 601.4 | + 8% | 60 | 48 | |||
Cost of materials* | -481.2 | -481.1 | - 0% | |||||
Spread (gross) | 170.0 | 120.3 | + 41% | 30 | ||||
in % of overall performance | 26.1% | 20.0% | - | 0 | 9M | 9M | 9M | |
Further operating expenses/income* | -68.1 | -71.8 | + 5% | |||||
17/18 | 18/19 | 19/20 | ||||||
EBITDA* | 101.9 | 48.5 | > + 100% | Spread (gross) / in % of | ||||
200 | overall performance [M€] | |||||||
EBITDA benefits from first-time adoption of IFRS 16 | 158 | |||||||
| 170 | |||||||
EBITDA doubled despite higher raw material prices | 150 | |||||||
120 | ||||||||
100 | 24% | 26% | ||||||
20% | ||||||||
50 | ||||||||
0 | ||||||||
*without restructuring costs and special items | 9M | 9M | 9M | |||||
17/18 | 18/19 | 19/20 | ||||||
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 9 |
Operating profit
(in € million) | 9M 19/20 | 9M 18/19 | ||||||||
Revenues | 667.6 | 596.1 | + 12% | |||||||
EBITDA* | 101.9 | 48.5 | > + 100% | |||||||
Margin | 15.3% | 8.1% | - | |||||||
Depreciation* | -31.6 | -29.3 | - 8% | |||||||
Operating profit | 70.3 | 19.1 | > + 100% | |||||||
Margin | 10.5% | 3.2% | - | |||||||
- Slightly higher depreciation from first-time adoption of IFRS 16
- Increase in operating margin from 3.2% to 10.5% yoy
Operating profit [M€] | |||
80 | 70 | ||
60 | 59 | ||
40 | |||
20 | 19 | ||
0 | |||
9M | 9M | 9M | |
17/18 | 18/19 | 19/20 |
*without restructuring costs and special items
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 10 |
Highlights: 3rd quarter 2019/20
Ethanol production | 251 | (277) ,000 m³ | - 9% |
Revenues | 220.0 (202.9) million € | + 8% | |
EBITDA | 37.0 (14.8) million € | + 22 million € | |
Operating profit | 26.6 (5.0) million € | + 22 million € | |
Net earnings | 18.4 | (5.8) million € | + 13 million € |
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 11 |
Operating profit: 3rd quarter 2019/20
(in € million) | Q3 19/20 | Q3 18/19 | ||||||||
Revenues | 220.0 | 202.9 | + 8% | |||||||
EBITDA* | 37.0 | 14.8 | > + 100% | |||||||
Margin | 16.8% | 7.3% | - | |||||||
Depreciation* | -10.4 | -9.8 | - 6% | |||||||
Operating profit | 26.6 | 5.0 | > + 100% | |||||||
Margin | 12.1% | 2.4% | - | |||||||
- Lower production mainly due to maintenance activities
- Operating profit multiplied
- Significantly higher ethanol sales prices
- Lower net raw material costs
40 | Operating profit [M€] | ||||
30 | 29 | 27 | |||
20 | 15 | ||||
14 | |||||
10 | 5 | ||||
0 | |||||
Q3 | Q4 | Q1 | Q2 | Q3 | |
18/19 18/19 19/20 19/20 19/20 |
*without restructuring costs and special items
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 12 |
Income from operations
(in € million) | 9M 19/20 | 9M 18/19 | ||||||||
Revenues | 667.6 | 596.1 | + 12% | |||||||
EBITDA* | 101.9 | 48.5 | > + 100% | |||||||
Margin | 15.3% | 8.1% | - | |||||||
Depreciation* | -31.6 | -29.3 | - 8% | |||||||
Operating profit | 70.3 | 19.1 | > + 100% | |||||||
Restructuring costs / special items | 0.0 | 10.1 | < - 100% | |||||||
At equity result | 0.1 | 0.1 | + 2% | |||||||
Income from operations | 70.5 | 29.4 | > + 100% | |||||||
- No restructuring costs or special items in current financial year
Income from operations [M€]
80 | 70 | ||
60 | 58 | ||
40 | 29 | ||
20 | |||
0 | |||
9M | 9M | 9M | |
17/18 | 18/19 | 19/20 |
*without restructuring costs and special items
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 13 |
Net earnings for the period
(in € million) | 9M 19/20 | 9M 18/19 | ||||||||
Revenues | 667.6 | 596.1 | + 12% | |||||||
EBITDA* | 101.9 | 48.5 | > + 100% | |||||||
Operating profit | 70.3 | 19.1 | > + 100% | |||||||
Restructuring costs / special items | 0.0 | 10.1 | < - 100% | |||||||
At equity result | 0.1 | 0.1 | + 2% | |||||||
Income from operations | 70.5 | 29.4 | > + 100% |
Net earnings for the period
60 | [M€] | ||
50 | |||
45 | 42 | ||
30 | |||
15 | 13 | ||
0 | |||
9M | 9M | 9M |
17/18 | 18/19 | 19/20 | |||||||||||||
Financial result | -2.6 | -1.0 | < - 100% | ||||||||||||
Earnings before income taxes | 67.9 | 28.4 | > + 100% | ||||||||||||
Taxes on income | -17.6 | -15.5 | - 14% | ||||||||||||
Net earnings for the period | 50.2 | 12.9 | > + 100% | ||||||||||||
Earnings per share (in €) | 0.58 | 0.15 | > + 100% | ||||||||||||
Financial result increases due to unrealized currency effects | |||||||||||||||
Tax rate drops to 26 (55)% | |||||||||||||||
*without restructuring costs and special items | |||||||||||||||
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 14 |
Cash flow
(in € million)
Cash flow
Change in net working capital
Net cash flow from operating activities
Investments in property, plant et al. Payments into current financial investments
Cash flow from investing activities
Cash flow from financing activities
Exchange rate changes et al.
Increase/Decrease in cash and cash equivalents
9M 19/20
80.7
15.3
96.0
-19.7-14.9
-34.6
-52.2
1.5
10.7
9M 18/19
42.9+ 88%
7.1 > + 100%
49.9+ 92%
-8.5 | < - 100% | |||
0.0 | - | |||
-8.5 | < - 100% | |||
-64.9 | + 20% | |||
0.0 | - | |||
-23.5 | - | |||
Cash flow (+) /
Investments* (-) [M€] | |
90 | 81 |
60 | |
43 | |
30 | |
0 | |
-8 | |
-30 | -20 |
9M | 9M |
18/19 | 19/20 |
*excl. financial investments
30/11/2019 | 30/11/2018 | ||
Net financial assets** | 89.7 | 56.5 | + 59% |
- Higher investments in PPE to enhance production plants
- Significant improvement of net financial assets
**Net financial assets as of 30/11/2019: excl. adjustments from IFRS 16
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 15 |
Balance sheet structure and financial ratios
(in € million) | 30/11/2019 | 30/11/2018 | ||||||||||||
Assets | ||||||||||||||
Non-current assets | 382.4 | 385.8 | - 1% | |||||||||||
Current assets | 274.6 | 207.2 | + 33% | |||||||||||
Total assets | 657.0 | 593.1 | + 11% | |||||||||||
Liabilities | ||||||||||||||
Shareholders' equity | 480.6 | 442.3 | + 9% | |||||||||||
Non-current liabilities | 57.8 | 49.7 | + 16% | |||||||||||
Current liabilities | 118.6 | 101.1 | + 17% | |||||||||||
Total liabilities and equity | 657.0 | 593.1 | + 11% | |||||||||||
Net financial assets* | 89.7 | 56.5 | + 59% | |||||||||||
Equity ratio | 73% | 75% | - | |||||||||||
- Strong cash base
- Increase in equity reflects positive earnings situation
500 | Shareholders' equity [M€] | ||
480 | 481 | ||
460 | |||
440 | 442 | ||
432 | |||
420 | |||
400 | 30/11/17 | 30/11/18 | 30/11/19 |
*Net financial assets as of 30/11/2019: excl. adjustments from IFRS 16
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 16 |
Outlook 2019/20
- Insider information publication according to section 17 MAR of 16 December 2019:
- Revenues are now expected to reach around € 900 million
- Operating profit is expected to be approximately € 100 million
- This is equivalent to an EBITDA of around € 145 million
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 17 |
Financial Calendar
13 May 2020:Annual report and press and analysts' conference financial year 2019/20
8 July 2020:Statement for the 1st quarter of 2020/21
14 July 2020:Annual General Meeting 2020
7 October 2020:Report for the 1st half of 2020/21
13 January 2021: Statement for the 1st-3rd quarter of 2020/21
Stock Information
ISIN:DE000A0LAUP1
Symbol:CE2
Bloomberg / Reuters: | CE2 GY / CE2G.DE |
Transparency standard: Prime Standard
Disclaimer
Contact
CropEnergies AG
Maximilianstraße 10
68165 Mannheim
www.cropenergies.com
Investor Relations
Heike Baumbach
Phone: +49 (621) 71 41 90-30
ir@cropenergies.de
Public Relations / Marketing
Nadine Dejung-Custance
Phone: +49 (621) 71 41 90-65
presse@cropenergies.de
This presentation contains forward-looking statements based on assumptions and estimates made by the executive board of CropEnergies AG. Although the executive board may be convinced that these assumptions and estimates are reasonable, the future actual developments and future actual results may vary considerably from the assumptions and estimates due to many external and internal factors. For example, matters to be mentioned in this connection include changes in the general economic conditions, competitive product and pricing pressures and developments in the regulatory framework. CropEnergies AG assumes no responsibility and accepts no liability for future developments and future actual results achieved being the same as the assumptions and estimates included in this presentation. This presentation includes percentage and number rounding.
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 18 |
End
CONFERENCE CALL 1ST-3RD QUARTER 2019/20 | 19 |
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CropEnergies AG published this content on 13 January 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 January 2020 09:02:01 UTC