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• Sales Growth: 12% increase, 16.5% excluding currency effects.

• EBITDA Growth: 40% increase.

• EBIT Growth: 55% increase, with an EBIT margin of 18%.

• R&D Ratio: 19.4% of sales.

• Income Taxes: Tax rate of around 27%.

• Earnings After Taxes: 48% increase from continuing operations.

• Free Cash Flow: Approximately EUR57 million.

• Dividend Proposal: EUR1 per share.

• Sugarbeet Sales Growth: 21% increase.

• Sugarbeet EBIT: Increased from EUR253 million to EUR350 million, with an EBIT margin of around 40%.

• Corn Segment Sales: 5% decline, 1% decline adjusted for currency effects.

• Corn Segment EBIT: Increased from EUR19 million to EUR39 million.

• Cereal Segment Sales Growth: 12% increase.

• Cereal Segment Result: EUR50 million.

• Vegetable Segment EBIT: Minus EUR35 million.

• Investments: Increased to around EUR140 million.

• Debt Reduction: Over EUR300 million.

• Regulatory Approvals: Record high of 559 new varieties.

• Sales Growth Outlook: 2% to 4% on a comparable basis for fiscal year 2024-'25.

• EBIT Margin Outlook: 14% to 16% for fiscal year 2024-'25.

• Warning! GuruFocus has detected 5 Warning Sign with KNKZF.

Release Date: September 26, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• KWS SAAT SE & Co KGaA (KNKZF) achieved double-digit growth in sales and earnings, driven by a strong performance in the sugarbeet business.

• The company expanded its leading position in the global sugarbeet seed market, capturing a 70% market share.

• Strategic divestments, such as selling the corn business in China and South America, have improved the company's financial position.

• The company recorded a significant increase in operating earnings, with EBITDA up by 40% and EBIT up by 55%.

• KWS SAAT SE & Co KGaA plans to increase its dividend to EUR1 per share, reflecting a 50% increase over the last five years.

Negative Points

• The financial result was negatively impacted by a loss from the AgReliant joint venture and increased interest expenses.

• Sales in the corn segment fell by 5%, with a decline in North American sales through the AgReliant joint venture.

• The vegetable segment reported a significant EBIT loss of EUR35 million, attributed to lower sales and increased amortization expenses.

• The company anticipates a significant decline in sales and earnings for the cereal segment due to import restrictions in Russia.

• The overall net income increase was limited to 3% when accounting for discontinued operations, despite strong operating performance.

Q & A Highlights

Q: Can you clarify the impact of the Brazilian corn business divestment on KWS's debt level and cash proceeds? A: With the divestment, about EUR200 million of debt exited KWS. Additionally, EUR143 million was repaid from a promissory note. The cash proceeds from the Latin American business were between EUR200 million and EUR300 million, used to repay loans, thus reducing net debt by about EUR350 million. - Eva Kienle, Chief Financial Officer