CropEnergies once again lifts its revenue and earnigns forecast

14.02.2017

European ethanol producer CropEnergies once again increased its forecast for the earnings and profits in 2016-17, as prices rally.

"The main reasons for the better earnings situation are the spot prices for bioethanol which continue to be significantly higher than the previously expected forward prices," CropEnergies said.

CropEnergies which has an annual capacity of 1.3m cubic meters of bioethanol, from four plants in Germany, Belgium, the UK, and France, noted "high capacity utilization" in all of its production plants.

The company is owned by European sugar producer Suedzucker.

Last summer CropEnergies re-opened its mothballed Ensus plant in the UK, in response to higher prices.

Rising revenues

CropEnergies now expects revenues 2016-17 to reach of E800-810m, compared to E723m a year earlier.

This is up from a forecast E760-790m, made in January, itself an upgrade from an early forecast of E670-720m.

The company also lifted its forecast of operating profit to E85-100m, up from E87m a year ago.

This compares to an earlier forecast of E70-85m.

"At the same time, CropEnergies expects a record earnings before interest, taxation, depreciation and amortisation of approximately E130-135m," compared to E122m a year ago.

Volatile markets

"The business performance in the coming financial year 2017-18 will again be largely dependent on the volatile developments of the prices on bioethanol markets," CropEnergies said.

The company was a touch more downbeat for 2017-18 profits, due to the lower prices of later-dated ethanol contracts.

"Against this background and on the basis of current grain prices, CropEnergies expects a normalization of the operating profit for the financial year 2017-18 to a range of E40-80m," the company said.

As a result, the company expects to become completely debt-free "for the first time in company history".


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