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Syngenta, an agrochemical company acquired by Chinese state-owned ChemChina a year ago, benefited in the first half of 2018 from better operations in Brazil and China. The profit benefited from special items.
Syngenta has experienced new growth thanks to Brazil and China. (1965)
The group's sales rose 5 percent to $ 7.25 billion in the first half, Syngenta said Tuesday If ChemChina had not sold different companies during the acquisition, this would have resulted in a growth of 7%. Currencies helped: At constant exchange rates, the increase in sales is only 2%.
Net income was $ 1.23 billion, 32% higher than the same period last year. Net income was affected by disposals and lower restructuring charges.
However, Syngenta had to pay higher interest. To allow ChemChina to badume the $ 43 billion buy-in, Basler issued $ 4.75 billion in total bonds. According to media reports, ChemChina will soon merge with Sinochem – another Chinese public company.
More significant is the operating profit before depreciation and amortization (EBITDA); This rise of 1 percent to 1.70 billion dollars. Because sales grew faster than EBITDA, margins dropped from 24.2% to 23.4%.
Syngenta reported higher raw material and logistics costs. Global productivity initiatives have helped minimize their impact on margins.
Brazil is on the path of growth
Syngenta said that the Group had returned to growth in all regions. This applies especially in Brazil, where after several years of declining sales, they have again achieved a "solid" result. Syngenta has increased sales by 7% in the largest region of the Group, Europe, Africa and the Middle East, and 4% in its second region, North America. In the Asia / Pacific region, sales increased 8% over the first half of 2017, while US adjusted sales increased in the Chinese new home market only. Sales increased by 16%.
With respect to both business areas, Syngenta increased its crop protection activities by 6% to $ 5.50 billion. Antitrust transfers cost 2 percentage points. Seed sales stagnated at 1.75 billion. If we exclude the activity of sugar beet, a more than 5% would have been registered.
2017 still in deficit
Syngenta saw its sales decrease by 1% to 12.65 billion dollars in 2017. The year was characterized by difficult conditions and strong pressure on revenues in the region. 39, agriculture, it was said at the time. In addition, the group recorded a loss of $ 96 million last year. Red number officials were expensive legal cases in the United States.
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