The international fruit sector has made an eye-catching contribution to the financial bottom line at German trading conglomerate BayWa, which has reported a year-on-year increase in earnings for 2013, boosted by a strong performance in its recently expanded fresh produce business.
Recording annual revenues of just under €16bn compared with €10.5bn in 2012, the group, which owns a majority share in NZ fresh produce company Enza / Turners & Growers (T&G), saw its earnings before interest and taxes (EBIT) rise to almost €222m from €186.8m in the previous 12 months, while operating profit was up 16 per cent to €196m.
According to chief executive officer Klaus Josef Lutz, the 2013 financial year 2013 represented a significant 'milestone' in BayWa's more-than-90-year history.
'Over half of our revenues originate from our international business,' he noted. 'Only through the strategy of growth in our core areas of agriculture and renewable energies are we able to record such success today and propose to raise the dividend further.'
T&G's first full-year contribution to BayWa's financial results was 'major', according to Lutz, who went on to say he believed the group was on a 'firm footing' for 2014 as the agricultural, renewable energies and building materials trades – all key areas for the business – had showed promise in the first few months of the year.
Lutz confirmed thatfurther acquisitions – presumably including a possible deal for NZ apple exporter Apollo Fruit – were due to be completed and prepared for in the current financial year, above all in the agricultural industry.
BayWa is also expected to invest in fruit production in Latin America, most likely in Peru and Chile, during the coming months.
'We want to increase our international growth,' Lutz stated. 'As we were quick to adapt to globalised markets, we are able to drive forward the expansion and restructuring of BayWa AG in an extremely targeted and risk-aware manner.'
Fertile ground
Fruit was one of three areas, alongside agricultural trade and equipment, to contribute to a doubling of revenue in BayWa's agriculture segment to around €10.7bn in 2013.
Results in the fresh produce sector were described as 'very positive', particularly as a result of good harvest marketing and rising harvest volumes in New Zealand.
Consequently, revenues grew to €567.7m from €468.3m in 2012, with EBIT climbing to €21.6m.
'All in all, the three major agricultural acquisitions in the last two years have had an extremely positive effect on BayWa's result,' Lutz explained.
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