Record turnover and strong profits in an extraordinary year

2020 was an utterly extraordinary year for the Danish Agro group where we had to handle large external crises. The corona pandemic hit us in March, and only just a month later, large parts of our IT environment was shut down as a result of a hacker attack.

In 2020, both events contributed to uncertainty, complicated business procedures and not least did they make great demands on all employees of the Danish Agro group. Therefore, it is really impressive that despite the extraordinary challenges we have succeeded in realising a profit before tax of EUR 66 million, which is an improvement of EUR 12 million as compared with 2019. The satisfactory result has been delivered based on record turnover of EUR 5,295 million, which is an improvement of 11.7% compared to the year before.

Due to the corona pandemic and the hacker attack, there was much focus in 2020 on securing continued operations. The supply of goods and services to the farmers had to be guaranteed, but at the same time we succeeded in developing our business and increasing trade with even more farmers.

In 2020, a range of major structural goals were met, which will have great significance for the further development of the group.

In February, we concluded an agreement with Vestjylland Andel on the purchase of the remaining 22.3% shares in Hedegaard. This has meant that we can structure and implement synergies in a completely different way than before – work that is well underway.

Financial results


In 2020 Danish Agro delivered large progress in the financial results in an otherwise challenging year that was characterised by extensive competition pressure, the corona pandemic and a hacker attack.

PRE-TAX PROFIT

The Danish Agro group realised a result before tax (EBT) at EUR 66 million, which is EUR 12 million higher than the year before. It is a very satisfactory result that has been realised despite intense competition pressure and which follows the group’s budgets and objectives for the year.
 

TURNOVER

The pre-tax profit has been realised based on the Danish Agro group’s largest turnover so far of EUR 5,295 million, which is 11.7% higher than in 2019. The large increase in turnover of EUR 555 million indicates increased trading with even more farmers in the past year. Out of this, EUR 94 million stems from acquisition of machinery activities in the Baltic countries.

Despite extraordinary challenges, among other things the corona pandemic and a hacker attack, the group has succeeded in increasing market shares across the divisions of the group.

OPERATING INCOME

Also the group’s operating income (EBITDA) was at a satisfactory level of EUR 152 million, which is EUR 11 million higher than in 2019.
 

BALANCE SHEET

Due to strong focus on managing capital tie-ups, the total balance sheet is realised at EUR 2,312 million, which is on level with last year. This was achieved despite an 11.7% increase in activities. At the same time, the net interest-bearing debt has been successfully reduced by approximately EUR 13 million due to positive cash flows from operations and constraints on investments.
 

EQUITY AND SOLVENCY RATIO

The group equity has increased by over EUR 8 million and is EUR 717 million at the end of the year. This, compared with the smaller balance sheet, means that the solvency ratio has increased to 31.0%.

DISTRIBUTION OF PROFIT

 
The board of directors of Danish Agro is pleased to be able to recommend the profit-sharing of EUR 6.4 million as distribution of profit to the members, equivalent to 25% of the parent company's posttax profit. The profit-sharing should be allocated on the basis of the year's commercial transactions.

Key performance indicators

The group key performance indicators for 2020 shows the income statement and balance sheet along with the cash flow statement and selected key financial figures.

LARGEST CLAAS CUSTOMER IN THE WORLD

 
After only four years the Danish Agro group has become the absolute largest customer of the German company, CLAAS, with distribution responsibility in Scandinavia, Finland, and the Baltics.

Annual report 2020

2020 was an utterly extraordinary year for the Danish Agro group where we had to handle large external crises. The corona pandemic hit us in March, and only just a month later, large parts of our IT environment was shut down as a result of a hacker attack.

Therefore, it is really impressive that despite the extraordinary challenges we have succeeded in realising a profit before tax of EUR 66 million, which is an improvement of EUR 12 million as compared with 2019. The satisfactory result has been delivered based on record turnover of EUR 5,295 million, which is an improvement of 11.7% compared to the year before.

MAIN OBJECTIVES 2021

 
Despite commercial challenges in the shape of corona and a hacker attack in 2020, the DanishAgro group has a financially strong position at the start of 2021. Solid high-quality crops were realised in large parts of our market areas in 2020 providing a good commercial basis for the coming year.

We are again setting ourselves ambitious structural and financial objectives. We constantly focus on finding a strong balance between financial robustness and further development of the group. We always have a goal to improve our financial ratios, including performance, equity etc. so that we have as strong a basis as possible for the further development of the activities. At the same time, it is our goal to develop the business on an ongoing basis so that we live up to the modern farmer’s requests and needs. That must take place so that there is a balance between considerations for financial ratios and future business potential.

The Danish Agro group is setting itself ambitious financial targets for 2021. The current business is the primary focus, and here, as many synergies as possible must be extracted from the current activities so that the overall market position is strengthened. All the time, we must take into account the structural adaption towards larger and fewer farmers taking place with our customers.