Adama Profit, Sales Rise on Strength in Europe
13 May 2014 Adama, the off-patent crop protection company formerly known as Makhteshim Agan, said first-quarter profit rose as buoyant European and Latin American sales offset declines in North America and other regions.
Net profit increased 9.4% to $98.7 million, compared with $90.2 million in the corresponding quarter last year.
Overall, sales rose 2.7% to $909.7 million in the period. Sales in Europe were strongest, rising 7.2% to $467.2 million in the quarter. It cited the early start of the season, an increase in sales volumes, increased selling prices and the strengthening of the euro, which was partially offset by currency hedging. Latin America sales increased 6.2% to $136.2 million, on higher volumes that were partially offset by lower selling prices.
North American sales fell 5.1% to $138.4 million, due to the long winter and lower prices. Sales in Asia Pacific, Africa and the Middle East decreased by 3.6%, attributable primarily to adverse climatic conditions (especially in Australia) and a significant weakening of currencies in these areas, which was partially offset by increasing sales prices.
President and CEO Chen Lichtenstein commented, “Our first quarter results demonstrate our solid commercial operational base allowing us to benefit from favorable market conditions in some key territories. Our positive momentum overcame challenging weather and currency conditions in North America, Southeast Asia and Australia.
“Our global team has begun rolling out our new company brand, Adama, which brings together more than 40 brands under a single, global name. As we launch in each of our geographies, the new unified brand will support our market differentiation. We selected the name Adama – the Hebrew word for earth – since it connects us to the source of agriculture, the land and the farmer.
At the conclusion of this quarter we are also pleased to announce a number of new appointments which will allow us to improve our business execution and address key strategic initiatives. The changes include improved commercial resolve via the creation of geographic sales clusters, run by a number of our most capable commercial leaders, and the appointment of two chief commercial officers, overseeing our sales clusters as well as our marketing and product offering. In addition, new positions will align and focus the way we manage our existing product portfolio and future pipeline, as well as strengthen our global operations and the buildup of our business and activities in China,” Lichtenstein said.
Yang Xingqiang, Adama chairman, said Adama is making headway in its integration with ChemChina. “We are continuing to make progress towards achieving our integration goals in China, with the objectives of creating significant R&D, operational and commercial infrastructure in the country, in a way that will strengthen our presence in the Asia-Pacific region and our global capabilities,” he stated.
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