Europe
United States
The 2011 first quarter Intermediate Statement of the Sapec Group
In the first quarter the consolidated C.A. of the group reached EUR 167 million versus EUR 118 million in the first quarter of 2010. The consolidated EBITDA of the group is in light progression, with the poor performance of the agro commodities distribution sector having been compensated by the good progression of the crop protection sector.
Concerning the full-year forecast, the indications we have today, enable us to be confident concerning our traditional activities, which should be able to record in 2011 a progression of their operating results.
Current status on our businesses
- Crop protection: The agriculture campaigns in southern Europe are held normally and the climatic conditions are favorable. We are thus in full spring campaign and meet our expectations. The gross margins are in progression in Spain, following the rise of sales of our licensed products. The contribution of our exports outside the Iberian Peninsula is increasing, mainly in France and Italy, where we have already an interesting portfolio of registered products. This sector will be able to meet our expectations and record progression of its results in 2011.
- Crop nutrition: Sales in the Iberian Peninsula are stable and in good progression, in particular, in Brazil and Europe. The crop growth in Europe started normally, although the drought we have seen since April in the north could affect the expectations of certain farmers, however, is too early to draw conclusions. The unrest, which affects certain markets in the Middle East will cause a certain slowdown but measures were taken to deal with this situation. The good commercial forecast that we have for the second half will enable this sector to see a progression of its results in 2011, in spite of the weakness of the dollar which will be able to affect the gross margin.
- Agro commodities distribution: The volatility of commodity markets and agricultural difficulties in European cereals affected the results of the first quarter. Operating results in the first half of the year will remain negative, as in 2010, while the second half of 2011 should allow a recovery. The refunds by the harbor authorities of the due taxes, recorded in 2010 (T3), are on-going. The activity of the port terminals is in recovery and the results show an increase compared with 2010.
- Chemical products and environment: The sales of industrial chemicals are improving for the three sub-sectors of this business (classical, polymers and solvents). The average gross margin is in light regression but the costs optimization and the increased turnover allow a good improvement of the results. Environment (CITRI) is in line with our expectations. This business will be able in 2011 to maintain, even slightly improve, its recurring income.
- The logistics: Underpinned by a very good volume of activity our port terminal of Setubal recorded in the first quarter of 2011 an excellent earnings growth. The ground terminals saw at the first quarter 2011 a renewed activity, as a result of the new commercial dynamics and the growth of exports. Though still negative, the sector records an improvement of its operating results. This business, while still having a negative contribution in 2011, will be much better compared to 2010.
Regarding renewable energy
The production of the wind farms in the United States is progressing over 50% compared to a bad first quarter of 2010, with stable electricity prices.
The production of the hydro-electric power stations saw a very slight decline compared to 2010, largely compensated by a significant improvement in sale prices. The turnover of photovoltaic power stations noticed an improvement compared to 2010, the result of a reduced cloud cover over the quarter.
The EBITDA of renewable energy saw a very strong improvement compared to 2010, mainly in the United States. The new photovoltaic park of Alange did not start production because of delays due to the network connection. Additional time was granted by the authorities to compensate for the connection delays of this park, which should be able to be financed in "Project finance" as for the others.