Revenue for the Animal Nutrition division in the third quarter amounted to €794.4 million, a decrease of 7.1 per cent compared to Q3 2012. Volumes accounted for -3.4 per cent, while the price effect was -0.3 per cent. The contribution of acquisitions was -0.2 per cent and the exchange rate effect was -3.2 per cent.
Revenue in Premix & Feed Specialties decreased by 3.8 per cent to €303.2 million (Q3 2012: €315.3 million). Organic volumes in Premix & Feed Specialties were 0.1 per cent higher. Sales prices were on average 0.5 per cent lower, the acquisition effect was 0.7 per cent and relates to the premix activities of the acquisitions in Ecuador and Egypt, partly offset by the divestment of our business in Hungary in Q4 2012. The exchange rate effect was -4.1 per cent. The operating result was slightly lower than the same quarter last year.
The revenue in Q3 2013 of Animal Nutrition Canada was €123.5 million compared to €145.7 million in Q3 2012, a decrease of 15.3 per cent. The decrease was mainly caused by an exchange rate effect of -8.7 per cent. The price effect was -4.2 per cent and volumes declined by 2.4 per cent. The operating result was lower than the same period last year.
The revenue of Compound Feed decreased to €130.4 million compared to Q3 2012, a decrease of 17.9 per cent. Lower raw materials costs had a price effect of -5.0 per cent. Volumes decreased by 11.5 per cent compared to the same period in 2012. The decline was mostly the result of lower feed volumes to farmers in the free market (not integrated) which were affected by the economic situation in Spain. The divestment effect was -1.3 per cent and related to the sale of a business in Hungary in Q4 2012. The operating result in Q3 was lower than the same quarter last year.
Revenue from Meat & Other was 0.7 per cent higher at €237.3 million, due to 3.2 per cent lower volumes and 5.5 per cent higher prices. Active account management has resulted in an increase in sales to new customers which partly compensated for lower sales to existing customers. There was a divestment effect of -0.9 per cent which related to the sale of a small poultry activity in Canada. The exchange rate effect was -0.7 per cent. The operating result was higher than the weak Q3 2012 driven by slightly higher prices and lower input costs.
The revenue in Fish Feed was 11.4 per cent higher than in the third quarter of 2012 at €696.1 million. The volume effect in revenue was 1.4 per cent mostly due to an increase in market share in salmon feed partly offset by lower non-salmonid feed sales especially in China. Salmonid volumes increased by 6.1 per cent. This was mainly driven by securing higher volumes in Norway. The price effect was 10.5 per cent due to the pass through of higher raw material prices. The exchange rate effect was -5.8 per cent. The acquisition effect was 5.2 per cent which is due to the acquisitions in Ecuador and Egypt.
The volume share of fish feed for non-salmonid species is now 38 per cent compared with 35 per cent in the same quarter last year. The operating result in Q3 was lower than the same quarter of 2012 due to a lower EBITA margin in Norway in a challenging market environment and lower results in China.
CEO of Nutreco, Knut Nesse, said: "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 per cent 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.
"In Fish Feed we secured our salmon feed volumes and regained our global market leadership position. Due to a challenging market environment in Norway our EBITA margin in salmon feed declined. The integration of our recently acquired businesses in Ecuador and Egypt is on track.
"Against this background and based on current trading conditions Nutreco expects the full year EBITA before exceptional items to be approximately €255 million (previous outlook; at least in line with 2012: €262.1 million).
"In Animal Nutrition we aim to be the leader in the development and supply of value-added nutritional solutions that are tailored to meet unique on-farm requirements. Over the last 12 months we made significant progress in developing and launching new products that give me a lot of confidence in the near future. We continue to invest in innovation and we are setting the scene for world class shrimp feed R&D. We expect to launch our sustainable MicroBalance concept for shrimp feed, which replaces expensive fishmeal by alternative protein raw materials, within 12 months.
"I fully believe in the strong long term fundamentals of Animal Nutrition and Fish Feed. I am committed to our strategy of increasing profitability through innovative and sustainable nutritional solutions, while leveraging our position and capabilities to seize global opportunities in our industry."
Outlook for full year 2013
The following developments are expected for the full year 2013:
- Animal Nutrition: EBITA before exceptional items in line with last year (2012: €149.2 million) with higher operating results in Premix & Feed Specialties and Meat & Other and lower operating results for Animal Nutrition Canada and Compound Feed.
- Fish Feed: EBITA before exceptional items clearly below last year (2012: €142.0 million). The EBITA contribution of newly acquired companies will be more than offset mainly by lower margins in Norway and to a lesser extent, an adverse foreign currency impact.
Based on current trading conditions Nutreco expects the full year EBITA before exceptional items to be approximately €255 million (previous outlook; at least in line with 2012: €262.1 million).
Agenda for 2013
Nutreco will continue to execute the strategic roadmap towards 2016:
- Develop higher added value portfolio of nutritional solutions
- Focus on Premix & Feed Specialties and Fish Feed
- Continue drive for operational excellence in mature markets
- Grow in geographies Latin America, Russia, Asia and Africa
