German congolomerate BayWa has announced a successful start to the 2014 financial year 2014, with its overall performance reportedly boosted by strong fruit sales at New Zealand fresh produce company Turners & Growers, in which it has a majority shareholding.
The strong result achieved for its southern hemisphere fruit supply contributed to a successful three months for the group on international markets and helped negate the impact of a downturn in the sales volume for its German apple harvest in autumn 2013, which was below that sold in the previous season.
Stable market pricing meant BayWa's fruit business unit was able to generate revenues of €115.8m in the first quarter, nearly matching the previous year’s total of €119m, although earnings were unable to match the previous year's figure.
'The poor fruit harvest in Germany last year and lower trade margins meant that the operating result for the first quarter in 2014 came to €2.0m, down by €1.9m on the previous year's figure,' the group said in a statement.
'This shortfall in earnings is likely to be recovered over the course of the year with the help of the fruit business in the southern hemisphere. Due to the promising development of vegetation so far, high yields are expected in the upcoming German fruit harvest that will give the business unit extra impetus through to the end of the year.'
Giant leap
Overall, the company was able to improve its earnings before interest and tax (EBIT) by €11.7m, generating an operating result of €4.3m compared with a loss of €7.4m in 2013.
In the first three months of the year, BayWa's business benefited from the mild weather and strong international business.
With revenues on a par with the previous year at around €3.6bn, it was also able to attain a significantly better operating result than usual for this period.
'The unusually mild winter was very positive for the agriculture and building materials segments,' explained chief executive Klaus Josef Lutz. 'The business with agricultural equipment, operating resources and building materials benefited from the earlier start to the season.'
He added: 'The positive start reinforces the target of increasing revenues and earnings year on year once again by the end of 2014.'
