KWS closes strong fiscal year 2023/2024 and increases dividend

Einbeck, 26.09.2024

Significant increase in key figures*: Net Sales: +12% to €1.68 (1.50) billion; EBITDA: +39% to €388.1 (278.8) million; EBIT: +55% to €302.0 (195.1) million; Earnings per share: +46% to €5.58 (3.82). Dividend proposal: increase to €1.00 (0.90) per share. Sale of corn business in South America strengthens KWS' financial power. CFO Eva Kienle to leave KWS in January 2025 * related to continuing operations

“KWS is operationally and strategically convincing in fiscal year 2023/2024: We achieved further double-digit growth in net sales and earnings year on year, expanded our world-leading position in sugarbeet seed with highly innovative solutions and well-filled our product pipeline for future growth with a record number of new variety approvals,” stated Eva Kienle, Chief Financial Officer of KWS. “From a strategic perspective, the completed sale of the corn business in South America significantly strengthens our financial power, focuses our resources on strategic future areas and sets the course for more profitable growth.”

Business development 2023/2024

The key figures reported below relate to KWS' continuing operations following the agreements reached at the end of March 2024 on the sale of the South American corn business; the corresponding key figures for the previous year have been adjusted accordingly. Preliminary key figures for fiscal 2023/2024 were already published on August 24, 2024, and are confirmed by today's publication.

The KWS Group's net sales rose strongly by 12% to €1,678.1 (1,500.3) million in fiscal year 2023/2024. On a comparable basis*, net sales rose by around 16%. The operating result (EBIT) recorded considerable growth of 55% to €302.0 (195.1) million, while the corresponding EBIT margin also improved significantly to 18.0% (13.0%). EBIT includes a one-off positive earnings contribution (€28 million) from the sale of the Chinese corn business. Earnings per share rose by 46% to €5.58 (3.82). Free cash flow improved slightly to €56.8 (50.0) million.

Business development by segment

In the Corn Segment, net sales fell by 5.0% to €701.5 (738.1) million in a challenging market environment in Europe and North America; on a comparable basis*, the decline was 0.6%. The increase in segment earnings to €38.9 (18.7) million is attributable to the positive earnings contribution from the sale of the Chinese corn business in the amount of approximately
€28 million. The segment's EBIT margin rose from 2.5% to 5.6%, taking into account the aforementioned one-off effect.

Net sales in the Sugarbeet Segment rose significantly by 20.7% to €864.9 (716.3) million. On a comparable basis*, the increase was 27.5%. The sustainable product innovations CONVISO® SMART and CR+, which continued to record high demand in the 2024 growing season and accounted for 56% (46%) of segment net sales, played a key role in this positive development. At €350.1 (253.4) million, segment earnings were up significantly on the previous year as a result of the dynamic sales performance. The EBIT margin improved significantly to 40.5% (35.4%).

In the Cereals Segment, sales rose significantly to €275.9 (247.1) million, mainly due to buoyant growth in oilseed rape, rye and wheat seed. That equates to an increase of 11.7%. Net sales growth on a comparable basis* amounted to 14.5%. Against the backdrop of the positive sales trend, the segment result increased significantly by 28.6% to €50.4 (39.2) million. The EBIT margin increased to 18.3% and was therefore also significantly higher than the previous year's figure (15.9%).

Sales in the Vegetables segment fell by 5.9% to €62.1 (66.0) million in the reporting year. On a comparable basis*, sales fell by a similar amount of 5.6%. The segment’s income fell sharply to €-34.7 (-11.8) million as a result of the operating performance, the planned increase in expenditure on establishing vegetable breeding activities and higher amortization of intangible assets from the acquisition of Pop Vriend Seeds.

Net sales in the Corporate segment amounted to €9.2 (8.3) million. This is mainly generated by KWS' farms. Since the Corporate Segment includes overarching costs for the KWS Group's central functions that cannot be allocated to the other segments, as well as research expenditure, the segment's income is usually negative. The segment's income fell to €-127.1 (-115.0) million, mainly due to general cost increases, particularly for personnel and planned higher research expenditure.

* excluding currency and portfolio effects

Forecasts for the 2024/2025 fiscal year

The Executive Board of the general partner of KWS SAAT SE & Co. KGaA, KWS SE, assumes that net sales will grow by 2 to 4% (excluding currency effects) in fiscal year 2024/2025. The lower growth momentum compared to previous years is due to the generally subdued agricultural environment and an expected sharp decline in business in Russia as a result of import restrictions and efforts to localize seed production.

The EBIT margin is forecast to be in the range of 14 to 16%, while the research and development ratio is expected to be between 18 to19%.

In addition, according to preliminary calculations, the Executive Board expects the recently completed sale of the South American corn business to have a one-off positive effect on earnings from discontinued operations of around €100 million (after tax). The transaction price amounted to a mid three-digit million Euro sum.

The sale will have a clearly positive impact on the KWS Group's key financial indicators. Most of the proceeds from the sale will be used to repay loans, which is why KWS anticipates a significant improvement in financial leverage (net debt/EBITDA) and the equity ratio, as well as a sharp drop in interest expenses.

Planned appropriation of profits: increase in the dividend to €1.00 (0.90) per share

Thanks to the company's positive business performance, the Executive Board and Supervisory Board will propose to the Annual Shareholders' Meeting on December 5, 2024, a dividend of €1.00 (0.90) per share for fiscal year 2023/2024. As a result, €33.0 (29.7) million would be distributed to the shareholders of KWS SAAT SE & Co. That would correspond to a payout ratio of 25.2% (23.4%) at the upper end of the company's dividend policy, which is geared to the company's earnings strength, and a dividend payment of around 20% to 25% of the KWS Group's net income.

CFO Eva Kienle to leave KWS in January 2025

At its meeting yesterday, the Supervisory Board of KWS SE approved the request of Eva Kienle, member of the Executive Board of KWS SE, to terminate her employment contract with the Board of Directors for personal reasons. She will therefore resign from her position on January 31, 2025 and will leave KWS at that time. Since July 1, 2013, Eva Kienle has been CFO of the KWS Group and has been responsible for the functions Finance & Procurement, Controlling, Global Transaction Center, Legal Services & IP, Information Technology as well as Governance, Compliance & Risk Management.

In addition to her highly successful work as CFO, Eva Kienle initiated and advanced KWS's digital agenda and successfully implemented the comprehensive strategic transformation project GLOBE (Global Business Excellence). “We regret this decision, which came as a surprise to us, but we respect Eva Kienle’s changed life plans. We are deeply indebted to Eva Kienle for her commitment and the work she has done over the past decade and wish her all the best for the future,” said the Chairwoman of the Supervisory Board of KWS SE, Dr. Marie Schnell.

Conference call for analysts and investors / Annual press conference

A telephone conference for analysts and investors with Eva Kienle (CFO) will be held today at 8:30 a.m. (CEST) on the occasion of the publication of the 2023/2024 annual financial statements. Further details can be found here.

KWS invites you to the annual press conference in Frankfurt/Main today with
Dr. Felix Büchting (Spokesman of the Executive Board) and Eva Kienle (CFO) starting at 10:00 a.m. (CEST).

The Annual Report 2023/2024 (PDF) as well as the Online Annual Report 2023/2024 are available at www.kws.com

About KWS

KWS is one of the world's leading plant breeding companies. Over 5,000 employees* in more than 70 countries generated net sales of around EUR1.68 billion in fiscal year 2023/2024. A company with a tradition of family ownership, KWS has operated independently for over 165 years. It focuses on plant breeding and the production and sale of seed for corn, sugarbeet, cereals, vegetables, oilseed rape and sunflowers. KWS uses leading-edge plant breeding methods to continuously improve yield for farmers and plants’ resistance to diseases, pests and abiotic stress. To achieve this goal, the company invested more than EUR 300 million in research and development in the past fiscal year.

* Excluding seasonal workers

Contact person:
Peter Vogt
Head of Investor Relations
Tel.: +49 30 816914-490
Mail: peter.vogt@kws.com

Sina Barnkothe-Seekamp
Lead of External Communications
Tel.: +49 5561 311-1783
Mail: sina.barnkothe@kws.com