October 22, 2013

Nutreco slashes 2013 profit forecast on adverse market conditions

Due to adverse market conditions, particularly in China and Norway, Nutreco, an animal nutrition and fish feed firm, has cut down its profit predictions for the whole of 2013.

Nutreco has presented revenue amounting to €1,490.5 million (US$2 billion) for the third quarter in 2013, a 0.7% increase compared to the same period in 2012.

Although animal nutrition revenue went down to €794.4 million (US$1.1 billion), a 7.1% decrease, fish feed revenue went up 11.4%, reaching €696.1 million (US$951 million).

The firm also reported that its recent acquisitions in Egypt and Ecuador have also had a positive impact of 5.2%. Animal nutrition division EBITA (earnings before interests, taxes, deductions) remains the same compared to the same period in 2012, however, fish feed division EBITDA has decreased due to lower results in China and a strong competition posed by Norway as well as a negative foreign currency impact.

Nutreco's CEO, Kurt Nesse remarked that: "Our results for the third quarter were below last year mainly due to lower results in Fish Feed and an adverse foreign currency impact. Our Animal Nutrition division results were in line with last year mainly due to a better performance in Meat & Other. For 2013 we expect to maintain our full year EBITA margin above 7% in our growth segment Premix & Feed Specialties and we expect to improve our results in Meat & Other which will compensate for lower results in our Animal Nutrition businesses in Canada and Spain."

Nesse said that the full year EBITDA of the recently acquired companies will be more than offset by lower margins in Norway, above all and to a lesser extent, by an adverse foreign currency impact.

Nutreco, given the present commercial conditions, estimates the annual EBITA will be around €255 million (US$349 million), below the previous prediction, which expected an EBITDA that would be roughly in line with 2012's, of €262.1 million (US$358 million).