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Following the purchase of additional Syngenta shares, ChemChina’s participation in Syngenta has exceeded 98% of Syngenta’s share capital.
Syngenta
ChemChina today announced the provisional interim results for ChemChina’s offer to acquire Syngenta.
Syngenta released Q1 revenue numbers. Sales reached US$3.7bn (-1% both reported and at CER). The group maintains its target for FY17 of “a low single-digit growth in sales, improvement in EBITDA margin and strong cash flow generation”.
Revenues in FY16 reached US$12,790m (-5% and -2% at CER), EBITDA US$2,659m (-4%m, +2% at CER), operating income US$1,647m (-11%) and net income US$1,178m (-12%). Net debt at the end of FY16 was US$2.3bn (US$3.09bn in FY15). No regular dividend will be proposed at the AGM in June (with a CHF5 dividend to be paid conditional upon and prior to the first settlement of the transaction. The expected closing of the deal with ChemChina is in Q2. For FY17, management expects a low single-digit sales growth at CER and an improvement in the group’s EBITDA margin.
Syngenta released Q3 sales, which reached US$2.524m (-3% both published and at CER) bringing 9m sales to US$9,618m (-6% and -3% at CER). At CER, regional sales (i.e. excluding Lawn and Garden) were down 4% (prices up 3%, volumes down 7%) with a weak South America where the change in sales terms in Brazil (and weak insecticides) weighed again. The group reiterated its full-year guidance of a low single-digit decline in sales, with an EBITDA margin at « around last year’s level ». The group also indicated that they now expect the regulatory process of the ChemChina offer to extend into Q1 17.
Syngenta released H1 16 numbers: sales were down 7% (-2% at CER) to US$7,094m, EBITDA -12% to US$1,767m, operating income -14% to US$1,351m, net income -13% to US$1,064m. Lastly, free cash flow reached US$337m vs US$-109m last year.
Sales reached US$3.7bn (-7% and flat at CER, with prices up 2% and volumes down 2%). The group indicated it targets to maintain its sales level of last year at CER while profits should benefit from the cost-cutting programme (US$300m in FY16) and lower raw material costs. It also aims to deliver a US$1bn free cash flow, partly on the release of working capital.
SAINSBURY (J) PLC | SYNGENTA AG-REG
Indices and Markets
Syngenta released FY15 results. They show sales down 11% to US$ 13.4bn (+1% at CER), EBITDA down 5% to US$2.78bn (+16% at CER), operating income down 13% to US$1.84bn and net income down 17% to US$1.34bn. Free cash flow (before M&A) was US$0.8bn. The proposed dividend is CHF11 (unchanged). For FY16, the group aims at "improving profitability on the basis of its AOL programme" (Accelerating Operational Leverage), which is a rather vague statement.
Syngenta’s CEO Michael Mack has announced his intention to step down and will leave the company at the end of October. John Ramsay, the CFO, is appointed as the interim CEO.
Syngenta released Q3 sales numbers that were flat at CER and down 12% in reported terms to US$2.6bn. Over 9 months, sales are up +2% at CER and down 8% reported to US$10.25bn. Excluding glyphosates and the change in the terms of sales in Brazil, sales would have been down 8% in Q3 at CER.
Monsanto announced it is withdrawing its offer on Syngenta since its improved proposal did not meet Syngenta’s financial expectations. Without a basis for constructive engagement from Syngenta, the US group indicated it "will continue to focus on its growth opportunities built on its existing core business to deliver the next wave of transformational solutions for agriculture".
H1 15 numbers: sales down 10% to US$7,634m (+3% at CER), EBITDA -5% to US$2,000m (+21% at CER), operating income -9% to US$1,566m, net income -12% to US$1,221m. Net debt at the end of H1 stood at US$3,609m vs US$3,611m last year (keep in mind this is not very significant since cash flow is generated in H2).
Syngenta made public an interview made by Mr Démaré, Chairman of the Board, to reassert the group’s view that Monsanto’s bid should be rejected. The main elements remain unchanged (the so-called "under-valuation" of Syngenta, the significant execution risks and the "damage" to Syngenta’s integrated business). Also, Démaré insists Monsanto has had a purely opportunistic approach, given Syngenta’s current share price weakness, in making its offer.
