BayWa has reported a positive set of results for the first half of 2017, aided by a "significant rise" in fruit business revenues.
Revenues rose from €7.5bn in 2016 to €8bn, while earnings before interest and taxation (EBIT) climbed to €72.8m, from €55.3m last year.
“Earnings were mainly driven by the Renewable Energies business sector in the first half of the year," said CEO Klaus Josef Lutz. "The Agricultural Equipment and Building Materials business units also turned in a very pleasing performance."
Fruit business revenues rose "significantly" on the back of the initial full-year consolidation of tropical fruit trading company TFC Holland BV, although, as the first half of 2016 was boosted by €7m by the special effect of the sale of the T&G Global Limited (T&G) packaging logistics unit, fruit EBIT for the first six months of 2017 was down year-on-year.
As T&G’s export activities are not likely to realise their full potential until the second half of the year on account of the rain-related delays to the New Zealand harvest, BayWa said that it saw good potential for T&G’s earnings development through to the end of the year.
BayWa noted that business in Germany, which was impacted in the second quarter by a low-yield soft and stonefruit harvest due to poor weather conditions, awaits a "difficult" 2017/18 marketing season due to major frost damage in the spring, particularly in the Lake Constance region, and correspondingly substantial harvest losses.
The domestic harvest situation, however, is likely to increase marketing opportunities for Southern Hemisphere fruit and also provide additional demand momentum for tropical fruit, with the company saying that it planned to benefit from the development.
Looking ahead, an expected revival in agricultural trading, farmers’ greater willingness to invest and generally positive economic data are forecast to help further increase revenues and EBIT in the second half of 2017.
“Overall, things are looking up for all our operating units, meaning that BayWa can continue to anticipate a significant rise in revenues and EBIT for the financial year 2017,” explained Lutz.