Annual Financial Statements as per 31 December 2016. Press … · 2017-03-30 · - Collected volume 2016/2017: 59,300 tons = +6.4% Pipfruit T&G, New Zealand - Collected volume 2016:

Annual Financial Statements as per 31 December 2016.Press Conference

Munich, 30 March 2017

Klaus Josef Lutz, CEO

Andreas Helber, CFO

30 March 2017BayWa AG Page 2

Agenda

1. Financial Year 2016

2. Performance of the Segments

3. Group Financials

4. Outlook for FY 2017

BayWa AG

Financial Year 2016Klaus Josef Lutz

30 March 2017 Page 3

Financial Year 2016 Highlights

BayWa AG 30 March 2017 Page 4

GROUP Diversified business portfolio supports development despite difficult agri markets

Ongoing internationalisation of business activities

Establishment of the Innovation & Digitalisation segment

Stable dividend

AGRICULTURE Implementation of speciality strategy through acquisitions: 100% Evergrain (Hamburg), 100%

Thegra Tracomex Group (Netherlands)

Expansion of Fruit: acquisition of 68.4% in TFC Holland, a supplier of exotic fruits and vegetables; entry into vegetable fruit cultivation in UAE through JV ‘Al Dahra BayWa LLC’

Internationalisation of Agri Equipment: full takeover of Agrimec Group (Netherlands), founding of JV with Barloworld (South Africa), CLAAS cooperation in Canada

ENERGY Ongoing growth of BayWa r.e.: market entry into South East Asia, Australia and BeNeLux

Global expansion of service business: technical & commercial operation of solar and wind farmswith an output of more than 2.3 GW

BUILDING MATERIALS Expansion of online offering: start to building materials online portal and interior designer,

developing of ‘Mr+Mrs Homes’ home configurator

– Slight increase in revenues above all through international expansion of agri trading

– Volume growth in grain & oilseed (+12% y/y) more than compensates for downturn in prices of grain and

crude oil

– Difficult agri markets burden result

– Unfavourable environment for agri trading and agri equipment partly offset by strong performance of

BayWa r.e., conventional energy, building materials and fruit

– Stable dividend at EUR 0.85 per share*


Overview

Revenues

in EUR bn

EBIT

in EUR m

Dividend

in Euro

* Subject to approval by the Annual General Meeting of Shareholders

2015 2016

15.4

+3.4%

14.9

-8.5%

2016

144.7

2015

158.1

2016

0.85

2015

0.85

Financial Year 2016 Summary of the Group´s key financials


Financial Year 2016 Multi-year comparison of operating EBIT

in EUR million

2016**2012

181.8

20112010 2015*

Ø 167.9147.9

112.6

194.8

2014

178.0

2013

190.4

169.5

* Excluding Digital Farming

** Excluding Innovation & Digitalisation


Financial Year 2016 Expansion progress

Operating EBIT contribution in EUR million

0

50

100

150

200

20152012 2013 2014 2016*2011

Core region (companies consolidated back in 2008)

Expansion (companies acquired from 2009 onwards)

18.4% 30.1% 44.4% 43.6% 56.2%Expansion

percentage54.9%

* Excluding Innovation & Digitalisation

BayWa AG

Performance of the SegmentsKlaus Josef Lutz


BayWa AG

Agriculture Segment 2016

Grain

Oilseed

Seed

Fertilisers

Crop protection

Feedstuff

Fruit

Agricultural equipment


Agriculture Segment 2016Market developments: Products

30 March 2017BayWa AG

Products World grain balance (excluding rice; March 2017)

In millions of tons

Page 10

Global grain output in 2016/17 on track for new record at

over 2 billion tons: volume growth in wheat (+2%) and

corn (+9%)

Global oilseed production 2016/17 of 716 million tons

likely to reach new record high

Inventories 2016/17 (grain & oilseed) continue to

increase despite higher consumption

EU grain harvest 2016 of 297 million tons impacted by

unfavorable weather (-5% y/y); wheat qualities

(especially in France) suffer from constant rain in early

summer

Below-average grain volume 2016 in Germany: decline

in the harvest to 45.3 million tons due to wet weather

conditions (-7% y/y)

Summer months determined by reticence of farmers to

sell and processors' reluctance to purchase; as from

autumn onwards, acceleration in trading and

collection/storage activitiesSource: USDA; * 2016/17 forecast

Inventory

change

Produc-

tion Consumption


Extreme VolatilityExtreme Volatility

260

280

300

320

340

360

380

Jan. 16 Mrz. 16 Mai. 16 Jul. 16 Sep. 16 Nov. 16 Jan. 17 Mrz. 17

US-$/mt Mai 17 Dec 17

50

100

150

200

250

300

350

€/mt Corn WheatContract

May 2017

Contract

Dec 2017

6-year low in grain prices

Falling prices during the selling phase in the first half of

2016

Modest price recovery at year-end harbours selling

potential in 2017

Extreme and unpredictable price volatility; intensified by

technical market mechanisms

Irrational price fluctuations

Inverse price curve hampers trading: price at the short

end of the forward curve higher than at the long end


Price developments: Products

Wheat & Corn prices 2006-2016 (MATIF) Soymeal price 2016 (CBOT)


Extreme VolatilityPositioning of funds increases volatilityExtreme Volatility

Soymeal 2016 vs average prices (day 1 = basis)

Irrational price development in soymeal

2016

Ø 5 years

Ø 10 years

Soymeal price 2016 vs position of speculative funds

(CBOT)

Price soymeal

(left axis)

Agriculture Segment 2016Challenges

Positioning of

speculative funds


Agri-Equipment

2016

28,746

2015

32,220

2014

34,611

2013

36,248

2012

36,264

Ø 33,618

-10.8%

New tractor registrations in Germany

21

63

1215

2021

17

31

3537

363534

30

35

0

5

10

15

20

25

30

35

40

Dez

16

Sep

16

12

Jun

16

Mrz

16

Jun

15

Sep

15

Dez

15

Mrz

15

Dez

14

Sep

14

19

Jun

14

Mrz

14

Dez

13

Sep

13

Dez

12

Sep

12

Jun

12

Mrz

12

– Downturn in producer prices causes strong decline in

willingness to invest of farmers

– Another sales drop in 2016 to EUR 7.2 billion

(-2% y/y) in German agri equipment sector

– Downtrend in new tractor registrations; significant sales

declines also for harvesting equipment, as well as

milking and transport technology

– Very difficult market in Austria (-11% y/y)

– Recovery in agri - economic barometer since June 16

Agriculture Segment 2016Market developments: Agri-Equipment

Fruit

General

- Cultivation and earnings sustainably optimised in

producing countries

- Global apple production at 85 mt, 50% comes from

China

Pipfruit BayWa, Germany

- Collected volume 2015/2016: 55,700 tons

- Collected volume 2016/2017: 59,300 tons = +6.4%

Pipfruit T&G, New Zealand

- Collected volume 2016: 5.9 m TCE (106 kt)

- Forecast volume 2017: 6.5 m TCE (117kt) = +10%

- Record volume for the last 10 years – upward trend

- Optimal export volume distribution between Asia,

EU-28, other

- Selling no longer on a commission basis, but at fixed

prices, and therefore upside potential

in millions of tons


Market developments: Fruit

TOP 15 apple producing countries> 50% comes from China

Global apple production

Other



Agriculture Segment 2016 Revenues and EBIT as against the previous year

Sale of input resources below previous year due to

significant decline in demand by farmers

Fertiliser applications hampered in early summer of

2016 due to impassable fields

Considerable downturn in fertiliser prices reduces

profit margins

Sharp increase in grain and oilseed trading volumes

of the BAGI companies (+12% y/y)

Irrational price fluctuations (soya, corn) owing to

unforeseeable supply and demand situation

Strong pressure on margins in grain & oilseed

trading

Commentary on BAST: Commentary on BAV:

Page 15

-58.7%

2015 2016

17.2

41.6

8,968.4

+7.8%

8,321.4

2015 2016

in EUR min EUR m

BAST (BayWa Agri Supply & Trade) + BAV (BayWa Agrar Vertrieb)

Revenues: EBIT:

-50.7%

EBIT

2016

10.6

2015

21.5

Agricultural Equipment

-0.3%

Revenues

1,256.81,260.7

in EUR m

Revenues: ∆ 15/16 EUR -3.9 million

EBIT: ∆ 15/16 EUR -10.9 million

Start of 2016: EUR -30 million order backlog y/y

Sales of new and used machinery in decline as

expected (EUR -3 million)

Agri Equipment Austria result of EUR -1.5 million

Investments in infrastructure and sales specialization

(MF, CLAAS): EUR -5 million



Revenues and EBIT as against the previous year

New tractor sales 2002-2016 (number)

1,000

0

500

3,500

1,500

2,000

2,500

3,000

4,000

4,500

5,000

3,986

2015

3,529

20162014

4,855

20132012

4,661

2011

4,366

3,850

2010

3,168

2009

3,038

2008

2,967

2007

2,832

2006

2,776

2005

2,111

2004

1,978

2003

1,690

2002

1,757

Ø 3,171

Revenues: ∆ 15/16 EUR +91.9 million

EBIT: ∆ 15/16 EUR +15.3 million

1. special effect - sale of FCC for ca € 7.5 m

2. special effect - acquisition tfc: EBIT contribution € 5.1 m

BayWa Germany: results according to season

T&G New Zealand: increasing production quantity, income

from affiliates and various divestments

Fruit

in EUR m


27.0

+56.7%

42.3

2015

EBIT

2016

567.4

+16.2%

659.3

Revenues


Revenues and EBIT as against the previous year

BayWa AG

Energy Segment 2016

Fuels

Heating oil

Lubricants

Solid biofuels

BayWa r.e.


Energy Segment 2016Market developments


Source: TECSON, as of March 2017

Conventional Energy

Following a 12-year low of oil prices at USD 28

per barrel in January 2016, increase to around

USD 57 per barrel by the end of the year

Sales decline in heating oil (-2.3%) and lubricants

(-2.8%) in Germany

German fuel sector up 3.1% in 2016 compared with

previous year level (stronger demand for diesel)

Renewable Energy

Global renewable energy investments of USD 288

billion down 18% y/y due to price decreases for PV

PV capacity installation at global record high (ca 75

GW) in 2016: China, USA & Japan as drivers;

Germany with 1.5 GW around 7% higher y/y

Global capacity installation of wind energy almost

55 GW (-14% y/y), of which 23 GW in China and 8

GW in the US; Germany at 4.6 GW (+24% y/y)

Heating oil prices Germany (2015-17)

Energy Segment 2016Worldwide expansion of power generation capacityuntil 2040 (GW)


Strong decline of conventional in favor of renewable capacities expected!

Page 20

0

50

100

150

200

250

300

350

400

450

500

Flexibilität*

PV klein

PV Freifläche

Wind offshore

Wind onshore

Biomasse

Wasserkraft

Nuklear

Öl

Gas

Kohle

Re

ne

wa

ble

Co

nven

tio

nal

50%

50%

15%

85%

Source: Bloomberg New Energy Finance

* Storage, flexible consumers

and other potential sources

Flexibility*

PV rooftop

PV ground mounted

Wind offshore

Wind onshore

Biomass

Hydropower

Nuclear

Oil

Gas

Coal


Conventional Energy



Above all price-induced decline in revenues (crude

oil price at 12-year low in January 2016)

Volume growth in fuel (+0.8% y/y); decline in sale

of lubricants (-5.3% y/y) and heating oil (-3.2% y/y)

Margin improvement in the fuel business

2,246.4

-9.6%

Revenues

2,030.1

+2.6%

EBIT

2016

15.8

2015

15.4

Renewable Energy

945.91,017.8

-7.1%

Revenues

EBIT

+8.9%

2015

61.8

2016

67.3



Decline in market price of solar components reduces

revenues; sales increase in PV trading (+10.9% y/y)

Record result through expanding international project &

service business: sale of 16 wind and solar farms in total

with an output of 212.9 MW; additional sale of 2 geo-

thermal plants (11.0 MW)

in EUR m in EUR m

Energy Segment 2016 Revenues and EBIT as against the previous year

BayWa AG

Building Materials Segment 2016

Building Materials


Building Materials Segment 2016Market developments

30 March 2017 Page 23BayWa AG

Construction market trends

Favourable weather conditions boost

construction activities over the course of the full

year

Construction industry reports 6% sales increase

in 2016; 20-year high in order intake

Positive development in all areas: residential

building with strong sales growth (+8.7%);

increase also in commercial construction (+3.4%)

and public-sector construction (+5.2%)

Urban multi-storey residential building as growth

driver: +19% completed buildings; one- and two-

family homes report slight growth

Capacity shortfalls lead to marginal decline in

energetic refurbishment

Construction forecast 2017, Germany

Revenue expectation 2017 for the construction

industry in Germany (€ bn):

Residential

construction

Commercial

construction

Public-sector

construction

Construction

industry total

West

East

Total

West

East

Total

West

East

Total

West

East

Total

Source: ZDB/HDB * Forecast

Change 2016/17 in % Revenues 2017*


2015

Building Materials

+2.3%

1,496.4

2016

1,530.1

Revenues: EBIT:

27.4 28.5

+4.0%

2015 2016

Building Materials

Building Materials Segment

in EUR m


Volume-induced increase in revenues

Higher sales across entire product range

(boom in residential construction)

Product portfolio for civil engineering and road

building benefits from investment increase in

transport infrastructure


Sales increase lifts profit y/y

Ongoing optimisation of

locations network

Reduced logistic costs (lower

fuel prices)

Building Materials Segment 2016 Revenues and EBIT as against the previous year

Innovation & Digitalisation

Innovation & Digitalisation Segment 2016Revenues and EBIT as against the previous year

In EUR m



EBIT: ∆ 15/16 EUR -5.7 million

Revenues from the activities of FarmFacts GmbH

and its subsidiaries (software licensing fees etc.)

Investment in new “Next Farming” product

generation incurs R&D costs

-2.9

2015*

-8.6

> -100%

EBIT

2016

5.2

+15.4%

6.0

Revenues

* Figures of former Digital Farming business unit

BayWa AG

Group FinancialsAndreas Helber



Group FinancialsFinal quarter as against the previous year

EBIT

– EUR 59.3 million (Δ 15/16: EUR -16.2 million)

– Decline in profit compared with very strong closing quarter in

2015 (record quarter for BayWa r.e.)

– Energy and Building Materials segments below Q4/2015

– Strong final quarter for Fruit

– Catch-up effects in Agri Equipment

Q4/2016

+3.6%

Q4/2015

3,831.4 3,970.6

Revenues

– EUR 3,970.6 million (Δ 15/16: EUR +139.2 million)

– Moderate revenue growth compared with previous year

– Increase in collection, storage and selling volumes of grain and

oilseed

– Sharp revenue increases from Fruit and Agri Equipment

– Energy and Building Materials segments in marginal decline

75.5

59.3

Q4/2015 Q4/2016

-21.5%

in EUR m

in EUR m

Group FinancialsKey Financials – Income Statement


Groupin EUR m 2012 2013 2014 2015 2016 ∆15/16 (%)

Revenues 10,531.1 15,957.6 15,201.8 14,928.1 15,409.9 3.2%

EBITDA 306.6 281.4 279.8 288.3 272.6 -5.4%

% of Revenues 2.9% 1.8% 1.8% 1.9% 1.8%

EBIT 186.8 137.4 152.1 158.1 144.7 -8.5%

% of Revenues 1.8% 0.9% 1.0% 1.1% 0.9%

EBT 122.6 75.1 80.4 88.1 69.6 -21.0%

% of Revenues 1.2% 0.5% 0.5% 0.6% 0.5%

Consolidated net income 118.0 54.3 80.7 61.6 52.7 -14.4%

Tax rate 3.8% 27.7% -0.4% 30.1% 24.3%

Share of minority interest 21.3 23.1 19.3 13.4 21.6 61.2%

as % of net income 18.1% 42.5% 23.9% 21.8% 41.0%

Share of owners of parent company 96.7 31.2 61.4 48.2 31.1 -35.5%

as % of net income 81.9% 57.5% 76.1% 78.2% 59.0%

Earnings per share (EPS) in EUR 2.82 0.91 1.78 1.39 0.90 -35.3%

in EUR m 2012 2013 2014 2015 2016 ∆15/16 (%)

Total assets 4,460.2 5,199.3 5,652.0 6,036.7 6,474.9 7.3%

Equity 1,078.0 1,115.0 1,050.4 1,075.9 1,098.3 2.1%

Equity ratio 24.2% 21.4% 18.6% 17.8% 17.0%

Equity ratio adjusted* 27.1% 23.8% 22.4% 21.4% 20.8%

in EUR m 2012 2013 2014 2015 2016 ∆15/16 (%)

Non-current assets 1,783.3 2,094.0 2,261.7 2,287.2 2,355.7 3.0%

Current assets 2,444.4 3,061.8 3,371.8 3,739.7 4,094.2 9.5%

Provisions 784.2 772.5 921.2 913.8 956.2 4.6%

Non-current financial liabilities 649.2 788.4 1,107.9 1,223.2 1,269.3 3.8%

Current financial liabilities 897.7 1,140.6 1,175.1 1,321.0 1,520.8 15.1%

Group FinancialsKey Financials – Balance Sheet


* Adjusted for the reserve formed for actuarial profits and losses

Group

BayWa AG

In EUR million

- Projects

BayWa r.e.

265356 375

306

598721

273

112

329

109

453

78

739

18

538

385

-60

662

321

56

438

Total assets

5,199

Total assets

4,460

Total assets

5,652

Total assets

3,922

Total assets

3,260

Total assets

6,037

Total assets

6,475

2010

2011

2012

2013

2014

2015

2016

Increase/decrease induced by divestments or organic growth

Increase induced by acquisitions

- Expansion

BayWa r.e.

- T&G Global - Cefetra

- Bohnhorst

- Projects

BayWa r.e.

- BAGI - Evergrain

- TFC

- Divestment DIY

Group Financials

Balance sheet growth

Page 3030 March 2017

Reduced by readily

marketable inventories

(agricultural products)

+ non-recourse

financing

Reduced by total readily


(agricultural products and

input resources) +

non-recourse financing

Equity ratio 3:

21.5%

Equity ratio 2:

20.2%

Equity ratio 4:

26.6%

Equity ratio 1:

19.3%

Group Financials

Equity ratio and cash convertibility of assets

Total

assets

adjusted

5,693

782

Total

assets

2016

6,475

1,373

Total

assets

2016

6,475

5,102

Total

assets

adjusted

Total

assets

2016

6,475

2,352

4,123

Total

assets

adjusted

6,475

1,098

2016

Total assets

Equity

Equity ratio:

17.0%

in EUR million

6,475

Total

assets

adjusted

5,446

Total

assets

2016

1,029

Reduced by readily


(agricultural products)

Reduced by total readily


(agricultural products and

input resources) +

non-recourse financing +

accounts receivable


Group FinancialsKey Financials – Cash Flow Statement


in EUR m 2012 2013 2014 2015 2016 ∆15/16 (%)

Consolidated net income 118.0 54.3 80.7 61.6 52.7 -14.4%

Cash flow from operating activities 150.0 230.3 -90.6 19.0 208.6 > 100%

Cash flow from investing activities -193.7 84.5 -227.6 -143.5 -123.6 13.9%

Cash flow from financing activities 37.4 -297.0 334.4 98.7 -63.0 > -100%

Cash & cash equivalents at the start of the period 87.0 83.2 92.1 108.4 84.5 -22.0%

Cash & cash equivalents at the end of the period 83.2 92.1 108.4 84.5 104.4 23.6%

Group


Other Activities 2016Revenues and EBIT as against the previous year

in EUR m



EBIT consists of non-core activities, overhead costs and

consolidation effects

+3.9%

12.8 13.3

Revenues

+15.1%

20162015

-33.7-28.6

EBIT

BayWa AG

OutlookFinancial Year 2017Klaus Josef Lutz


Outlook 2017Agriculture Segment

Page 35

BUIL

DING

MAT

ERIA

LSBayWa AG 30 March 2017

AGRICU

LTURE

– High grain stocks can cause selling potential for H1/2017; recovery of producer prices

– Record harvest volume anticipated for grain & soya 2016/17 offers little scope for long-term price increases

– Expanding of higher-margin speciality business (Evergrain, Thegra Tracomex)

– Demand for input resources likely to normalize; fertilizer business benefits from price increases

– Agricultural equipment investments in Germany and abroad expected to pick up momentum – order backlog

higher than in 2016 (+14% y/y)

– Selling volume of fruit (domestic & international) expected to increase

Outlook 2017Energy Segment

Page 36

BUIL

DING

MAT

ERIA


AGRICU

LTURE

– Output capacity of around 500 MW planned for 2017 (200 MW wind, 300 MW solar); margin pressure due

to increasing competition in international project business

– BayWa r.e. as leading supplier in Europe likely to benefit from rising demand in trading of PV components

(ongoing price decline)

– Crude oil prices predicted above previous year; long period with frost in January / February could boost

heating oil sales

− Stable demand for fuel and lubricants expected due to positive economic development

Outlook 2017Building Materials Segment

Page 37

BUIL

DING

MAT

ERIA


AGRICU

LTURE

– Increasing construction forecast 2017: overall revenue growth of 5% in German construction industry

– Positive expectations for residential construction (+7% y/y), commercial construction (+3% y/y), public-

sector construction (+5% y/y)

– Trend towards prefabrication: rising demand for building components and precasted modules anticipated

– Additional value-added potential through expansion of online offerings; expansion of own brand portfolio

– Volume-induced earnings growth likely to more than compensate for cost increases (labor costs)

Thank you for yourattentionThe information in this presentation is partly made up offorward-looking statements which are based on assumptions and are subject to unforeseeable risks.In as much as the assumptions on the successfulintegration of acquisitions and on the internal growth ofthe company should prove to be inaccurate, or shouldother unforeseeable risks occur, the possibility of theassets, financial position and results of operations of theGroup diverging negatively from the target figures cited in this presentation should not be discounted.BayWa AG can therefore undertake no guarantee that theactual development of the net worth, financial position andresults of operations of the Group will concur with thetarget figures described in this presentation.

Documents

Annual Financial Statements as per 31 December 2016. Press … · 2017-03-30 · - Collected volume 2016/2017: 59,300 tons = +6.4% Pipfruit T&G, New Zealand - Collected volume 2016: