march 20, 2019 – leading global crop protection company adama ltd. (the “company”) (szse 000553), today reported fourth quarter and full year 2018 financial results.
q4 sales increased 17.3% to a record high $963 million, up 22.8% in constant currency terms
-record q4 sales driven by robust business growth, led by significant outperformance in brazil, as well as increased prices, somewhat offset by softer currencies;
-full year sales grew by $358 million, or 10.2%, to a record high $3,881 million (up 12.4% in constant currency terms), driven by 8.1% growth in sales of an increasingly differentiated portfolio, as well as increased prices;
-best-ever performance in most territories, with significant market share gains;
-40% increase in sales of formulated, branded products in china
q4 gross profit increased 17.6% to a record high $312 million
-gross margin of 32.4%, in line with last year;
-continued differentiated portfolio growth and price increases partially offset by higher procurement costs and softer currencies;
-full year gross profit up 4.4% to a record high $1,291 million; gross margin of 33.3%;
-strong business growth and increased prices more than offset increases in procurement costs and adverse currencies impact; capitalizing on increased backward integration in key products
operating cost discipline yields improved cost/sales ratio, driving higher operating profit
q4 ebitda increased 34.5% to a record high $134 million vs. $100 million in q4 last year
-ebitda margin of 13.9%, up 1.7 percentage points over last year;
-full year ebitda reaches all-time record high of $653 million (margin of 16.8%), beating last year’s record
q4 income before tax up 279.4% to $47 million
-full year income before tax above last year’s
q4 net income increased 79% to a record high $46 million
-full year net income of $249 million (margin of 6.4%) vs. $280 million last year (margin of 8.0%);
-2017 saw relatively low tax expenses, benefiting from tax income from expected utilization of tax loss carry forwards; normalized taxes would have put fy net income above 2017 record
continued meaningful cash flow generation, while supporting strong growth and absorbing higher procurement costs
-operating cash flow of $305 million in the full year;
-free cash flow of $79 million
balance sheet net debt of $457 million
-net debt / ebitda ratio of 0.7x, in line with the lowest ever same point last year
commenting on the results, yang xingqiang, chairman of adama’s board of directors, said, “our robust performance, reaching all-time record highs of nearly $3.9 billion in sales and $653 million in ebitda, continues to demonstrate our ability to overcome challenging market conditions and grow our market share worldwide. adama’s vast portfolio of differentiated products and global commercial presence enables us to continue our significant growth momentum.”
chen lichtenstein, president and ceo of adama, added, “we delivered the strongest fourth quarter results to date, driving double-digit sales growth over the full year, despite continued subdued agricultural commodity prices and challenging weather conditions in key regions. we continue to strengthen our core business by investing in our pipeline of new and differentiated products, executing on our growth strategy.”
