|By Marketwired .||
|March 6, 2014 07:30 AM EST||
BEIJING, CHINA -- (Marketwired) -- 03/06/14 -- Agria Corporation (NYSE: GRO) (the "Company" or "Agria"), a global agricultural company, today announced its financial results for the six months ended December 31, 2013.
New Segment Reporting Structure
The Company has adopted new segment reporting of revenue and profitability for the first half of fiscal year 2014 and onwards. The new reportable segments are considered to better reflect the results of operations carried out in line with the Company's integrated and global strategy. The Company also believes that the new segment reporting will offer a better understanding of its global strategy to shareholders and stakeholders.
The Company now reports on three business segments: (i) Seed and Grain; (ii) Crop Protection, Nutrients and Merchandise; and (iii) Rural Services.
- Seed and Grain - This business segment is engaged in research and development, production, and sale of seed products including forage, turf, maize, corn, cereal and vegetable seeds. Its business also includes multiplication of seed for international customers and trading of seed and grain products globally.
- Crop Protection, Nutrients and Merchandise - This business segment operates an extensive chain of retail stores that supply farm input materials including chemicals, fertilizers, pollination products, frost protection products, fencing, animal health and nutrition products, grains and seeds, clothing, leisure goods, and gardening equipment. It offers a wide range of plant nutrition options, supported by industry-leading knowledge of the specific products and application protocols.
- Rural Services - This business segment offers a variety of services critical to the agricultural economy, including:
- Livestock - Livestock agents for sheep, beef, dairy, and deer farmers, meat processors and livestock exporters. The primary service is trading livestock through auctions, private on-farm sales, and online or direct sales to meat processors;
- Wool - Sales agents for sheep farmers, primarily through auctions, forward contracts and private sales; and providing comprehensive range of services to grower clients and wool processors including on-farm assistance, in-store wool handling and export processing;
- Irrigation and Pumping - Design, construction, installation and servicing of irrigation and pumping systems;
- Real Estate - Real estate brokerage primarily focused on farm sales with additional transactions in lifestyle and residential properties; and
- Insurance - Insurance brokerage providing a range of market-leading insurance products.
The segment information presented below for the six months ended December 31, 2012 has been restated in accordance with the new reporting segments.
Financial Highlights for the Six Months ended December 31, 2013:
- Consolidated revenues were RMB3,216 million (US$531 million) for the six months ended December 31, 2013, an increase of 6% from the same period last year. The increase in revenue was due primarily to restored strength in the Crop Protection, Nutrients and Merchandise segment, which grew 10% due to market growth and increased market share of certain key product categories.
- The Company recorded operating income of RMB94 million (US$16 million) for the six months ended December 31, 2013, compared to operating loss of RMB319 million for the same period last year. The operating loss for the prior period includes a one-off impairment loss on land use rights and non-current prepayments of RMB357 million. Operating income excluding impairment loss on land use rights and non-current prepayments for the prior period was RMB38 million. The significant improvement in operating income was due to solid improvement in profitability across all three business segments.
- Net income attributable to shareholders was RMB11 million (US$2 million) for the six months ended December 31, 2013, compared to a net loss of RMB375 million for the same period last year.
- The Company's financial position strengthened during the first half of the fiscal year. As of December 31, 2013, cash and cash equivalents were RMB187 million (US$31 million). Total bank debts as of December 31, 2013 were RMB848 million (US$140 million), a decrease of 19% from June 30, 2013.
- The Company refinanced a substantial portion of bank debt in December 2013 at lower borrowing costs and with more flexibility, and also generated cash of RMB56 million (US$9 million) with the divestiture of its non-core holding in New Zealand's Heartland Bank.
Growth was driven by the Crop Protection, Nutrients and Merchandise segment, which increased revenue by 10% and operating income by 16% year-over-year. Additionally, the Seed and Grain segment increased revenue by 5% and operating income by 24% year-over-year. Rural Services revenue slightly decreased by 3% year-over-year while operating income increased 106% due to substantially better margins.
The following table summarizes the results for the first half of fiscal year 2014:
Revenue Operating income/(loss) For the six months ended For the six months ended December, 31 December, 31 2012 2013 2013 2012 2013 2013 RMB'000 RMB'000 US$'000 RMB'000 RMB'000 US$'000 Seed & Grain 1,026,044 1,073,838 177,385 35,249 43,774 7,231 Crop Protection, Nutrients & Merchandise 1,360,470 1,498,924 247,604 99,386 114,811 18,965 Rural Services 660,324 643,463 106,293 15,850 32,598 5,385 Corporate - - - (112,407) (97,202) (16,057) --------- --------- --------- -------- -------- ---------- 3,046,838 3,216,225 531,282 38,078 93,981 15,524 --------- --------- --------- Impairment loss on land use rights and non- current prepayments (357,262) - - -------- -------- ---------- (319,184) 93,981 15,524 -------- -------- ----------
Note: The December 31, 2012 operating loss included a RMB357 million impairment loss on land use rights and non-current prepayments. For comparison purposes, excluding this one-off impairment, 2012 operating income would be RMB38 million compared to RMB94 million for 2013.
Seed and Grain
Seed and Grain generated revenue of RMB1,074 million (US$177 million) and operating income of RMB 44 million (US$7 million) for the period, representing year-over-year increases of 5% and 24%, respectively. This segment accounted for 33% of consolidated revenue for the period. Growth was driven by solid results in seed and grain, with revenue up 7% and 21% respectively. Seed sales, in particular, benefitted from continued strong volumes in proprietary seeds and better pricing on our Cleancrop Brassica after this new high-value breed was introduced to the market. Grain growth was driven by increased volume of wheat and maize in reaction to favorable conditions in the dairy market, for which our products supply the feed source for dairy cows.
Crop Protection, Nutrients, and Merchandise
Crop Protection, Nutrients and Merchandise generated revenue of RMB1,499 million (US$248 million) and operating income of RMB115 million (US$19 million), representing year-over-year increases of 10% and 16%, respectively. This segment accounted for 47% of consolidated revenue for the period. Improved performance at the retail stores was the result of technical training and store refurbishments, which drove increased market share. Notably, technical training focusing on chemicals and seeds enabled substantial sales gains in those categories. Large dairy payouts and drought conditions also encouraged better-than-usual livestock feed sales. With the store refurbishment program nearly complete, same store sales improvements have become increasingly evident.
Rural Services generated revenue of RMB643 million (US$106 million) and operating income of RMB33 million (US$5 million), representing a year-over-year decrease of 3% and increase of 106%, respectively. This segment accounted for 20% of consolidated revenue for the period. Livestock revenue decreased 43% to RMB148 million (US$24 million), as a large export contract completed last year has not yet been replenished by new ones. Despite the decline in revenue, livestock trading was more profitable and recorded RMB7 million (US$1 million) of operating income. Other sectors of Rural Services exhibiting strong revenue growth included Irrigation and Pumping (up 30%), Wool (up 22%), and Real Estate (up 38%). All those segments also recorded operating income growth with the exception of Wool, which was impacted by the drought and lower overall volumes in the industry.
Going into the first half of the fiscal year 2014, all three business segments reported a stronger performance than the prior period.
With its global reach, the Company believes it can tap opportunities in rapidly expanding markets, including South America and Asia. Additional resources, including research and development expenditure, will continue to be invested into the Seed and Grain segment. Recently, Agria Academy was established with several highly-regarded seed experts performing the research and development for proprietary seeds. From this effort, the Company expects new seed cultivars to be commercialised in the near future. With its technologies and management expertise in the proprietary seed markets, the Company believes it will continue to create value for its customers in these markets and generate better return for its shareholders.
With improved general market conditions and solid agricultural commodity prices, the Company expects to see continued improvement in the fundamental performance across all of its business segments in the second half of this fiscal year.
Further consolidation trends in the global agriculture industry are anticipated. The Company envisions finding new merger and acquisition opportunities in its target geographies, including South and North America and Asia. The Company intends to explore external financing options in order to facilitate expansion in these key target markets.
Mr. Alan Lai, Agria's Chairman of the Board, commented, "We are very gratified to see our performance improve meaningfully in the first half of the fiscal year. In particular, we took decisive action last year to turn around performance in several business units by installing new management and implementing new initiatives in staff training and information systems. Most of our major business units are now exhibiting revenue growth and improving profitability. We believe we have laid the foundation for accelerated growth in the years ahead, and we will continue to expand our global operations according to our strategic plan."
Currency Convenience Translation
The conversion of Renminbi (RMB) into US dollars in this release is made solely for the convenience of the reader. The conversion rate of RMB into US dollars in this release is based on the H.10 statistical release of the US Federal Reserve Board as of December 31, 2013. Unless otherwise noted, all translations from RMB to US dollars and from US dollars to RMB in this release were made at a rate of RMB 6.0537 to US$1.00. Certain comparative figures are converted by using the rate as of the respective balance sheet dates.
Agria will discuss its financial results and outlook in a conference call on March 6, 2014 at 8:00 a.m. Eastern Time/9:00 p.m. Beijing time. The call will be hosted by Mr. Patrick Tsang, Chief Financial Officer, and Mr. Kean Seng U, Head of Corporate and Legal Affairs. Investors interested in participating in the live call should dial +1 (913) 312-0686 and enter passcode 1078875. A simultaneous live webcast will be available on the Company's website at www.agriacorp.com. A replay of the call will be available either via telephone or webcast until March 13, 2014. The telephone replay can be accessed by dialing +1 (858) 384-5517 and entering passcode 1078875. The webcast replay can be accessed in the Investor Center on the Company's website.
About Agria Corporation
Agria (NYSE: GRO) is a global agricultural company with three principal business segments: Seed & Grain; Crop Protection, Nutrients & Merchandise; and Rural Services. The Seed and Grain segment is engaged in research and development, production and sale of a broad range of seed products and trading of seed and grain products globally. The Crop Protection, Nutrients and Merchandise segment operates an extensive chain of retail stores that supply farm input materials. The Rural Services segment provides livestock trading, wool trading, irrigation and pumping, real estate agency and other agriservices. For more information about Agria Corporation, please visit www.agriacorp.com.
Safe Harbor Statement:
This announcement contains forward-looking statements. These statements, including the management's commentary, are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Agria may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on Forms 20-F and 6-K, etc., in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Agria's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, those risks outlined in Agria's filings with the U.S. Securities and Exchange Commission. All information provided in this press release is as of the date of this announcement unless otherwise stated and Agria does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
AGRIA CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) FOR THE SIX MONTHS ENDED DECEMBER 31, 2012 AND 2013 (Amounts in thousands of Renminbi ("RMB") and U.S. dollars ("US$"), except for number of shares and per share data) For the Six Months ended ---------------------------------------- Dec. 31, Dec. 31, Dec. 31, 2012 2013 2013 (RMB) (RMB) (US$) (unaudited) (unaudited) (unaudited) Revenue 3,046,838 3,216,225 531,282 Cost of revenue (2,321,157) (2,459,286) (406,245) ------------ ------------ ------------ Gross profit 725,681 756,939 125,037 Operating expenses (687,603) (662,958) (109,513) Provision for impairment of land use rights and non-current prepayments (357,262) - - ------------ ------------ ------------ Operating income (loss) (319,184) 93,981 15,524 Interest income 15,995 1,870 309 Interest expense and financing costs (45,255) (35,570) (5,876) Other income (expense) (6,848) 10,247 1,692 ------------ ------------ ------------ Income (loss) before income tax (355,292) 70,528 11,649 Income tax (5,679) (10,658) (1,761) ------------ ------------ ------------ Net income (loss) (360,971) 59,870 9,888 ============ ============ ============ Less net income, or addition of net loss, attributable to the non-controlling interest (13,779) (49,202) (8,128) ------------ ------------ ------------ Net income (loss) attributable to Agria Corporation (374,750) 10,668 1,760 ============ ============ ============ Earnings (loss) per ordinary share: Earnings (loss) per share - basic and diluted (3.38) 0.10 0.02 ------------ ------------ ------------ Weighted average number of ordinary shares outstanding - Basic 110,766,600 110,766,600 110,766,600 ------------ ------------ ------------ Weighted average number of ordinary shares outstanding - Diluted 110,766,600 110,821,425 110,821,425 ------------ ------------ ------------ AGRIA CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2013 AND DECEMBER 31, 2013 (Amounts in thousands of Renminbi ("RMB") and U.S. dollars ("US$")) Jun. 30, Dec. 31, Dec. 31, 2013 2013 2013 (RMB) (RMB) (US$) (audited) (unaudited) (unaudited) ASSETS Current assets: Cash and cash equivalents 267,796 187,241 30,930 Restricted cash 231,434 - - Accounts receivable, prepayments and other current assets 1,299,449 1,911,465 315,751 Inventories 1,223,711 1,134,230 187,362 ------------ ------------ ------------ Total current assets 3,022,390 3,232,936 534,043 ------------ ------------ ------------ Non-current assets: Property, plant and equipment, net 440,912 455,180 75,190 Intangible assets, net 43,725 46,849 7,739 Goodwill 20,167 20,167 3,331 Other non-current assets 134,062 96,522 15,944 ------------ ------------ ------------ Total non-current assets 638,866 618,718 102,204 ------------ ------------ ------------ Total assets 3,661,256 3,851,654 636,247 ============ ============ ============ LIABILITIES AND EQUITY Current liabilities: Short-term bank borrowings, and current portion of long-term bank borrowings 574,883 375,019 61,949 Accounts payable, accrued expenses and other liabilities 1,211,990 1,558,503 257,446 ------------ ------------ ------------ Total current liabilities 1,786,873 1,933,522 319,395 ------------ ------------ ------------ Non-current liabilities: Long-term bank borrowings, net of current portion 474,052 473,210 78,169 Other long-term liabilities 153,807 124,446 20,557 ------------ ------------ ------------ Total non-current liabilities 627,859 597,656 98,726 ------------ ------------ ------------ Total liabilities 2,414,732 2,531,178 418,121 ============ ============ ============ Equity: Equity of the Company 535,482 562,068 92,846 Non-controlling interest 711,042 758,408 125,280 ------------ ------------ ------------ Total equity 1,246,524 1,320,476 218,126 ============ ============ ============ Total liabilities and equity 3,661,256 3,851,654 636,247 ============ ============ ============
More and more companies are looking to microservices as an architectural pattern for breaking apart applications into more manageable pieces so that agile teams can deliver new features quicker and more effectively. What this pattern has done more than anything to date is spark organizational transformations, setting the foundation for future application development. In practice, however, there are a number of considerations to make that go beyond simply “build, ship, and run,” which changes how...
Dec. 9, 2016 12:45 AM EST Reads: 5,106
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
Dec. 9, 2016 12:45 AM EST Reads: 1,197
SYS-CON Events has announced today that Roger Strukhoff has been named conference chair of Cloud Expo and @ThingsExpo 2017 New York. The 20th Cloud Expo and 7th @ThingsExpo will take place on June 6-8, 2017, at the Javits Center in New York City, NY. "The Internet of Things brings trillions of dollars of opportunity to developers and enterprise IT, no matter how you measure it," stated Roger Strukhoff. "More importantly, it leverages the power of devices and the Internet to enable us all to im...
Dec. 9, 2016 12:30 AM EST Reads: 877
Whether your IoT service is connecting cars, homes, appliances, wearable, cameras or other devices, one question hangs in the balance – how do you actually make money from this service? The ability to turn your IoT service into profit requires the ability to create a monetization strategy that is flexible, scalable and working for you in real-time. It must be a transparent, smoothly implemented strategy that all stakeholders – from customers to the board – will be able to understand and comprehe...
Dec. 9, 2016 12:00 AM EST Reads: 688
"We are the public cloud providers. We are currently providing 50% of the resources they need for doing e-commerce business in China and we are hosting about 60% of mobile gaming in China," explained Yi Zheng, CPO and VP of Engineering at CDS Global Cloud, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 9, 2016 12:00 AM EST Reads: 1,171
"Once customers get a year into their IoT deployments, they start to realize that they may have been shortsighted in the ways they built out their deployment and the key thing I see a lot of people looking at is - how can I take equipment data, pull it back in an IoT solution and show it in a dashboard," stated Dave McCarthy, Director of Products at Bsquare Corporation, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 8, 2016 09:45 PM EST Reads: 1,237
In IT, we sometimes coin terms for things before we know exactly what they are and how they’ll be used. The resulting terms may capture a common set of aspirations and goals – as “cloud” did broadly for on-demand, self-service, and flexible computing. But such a term can also lump together diverse and even competing practices, technologies, and priorities to the point where important distinctions are glossed over and lost.
Dec. 8, 2016 09:15 PM EST Reads: 1,670
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
Dec. 8, 2016 09:15 PM EST Reads: 962
All clouds are not equal. To succeed in a DevOps context, organizations should plan to develop/deploy apps across a choice of on-premise and public clouds simultaneously depending on the business needs. This is where the concept of the Lean Cloud comes in - resting on the idea that you often need to relocate your app modules over their life cycles for both innovation and operational efficiency in the cloud. In his session at @DevOpsSummit at19th Cloud Expo, Valentin (Val) Bercovici, CTO of Soli...
Dec. 8, 2016 08:30 PM EST Reads: 1,891
Complete Internet of Things (IoT) embedded device security is not just about the device but involves the entire product’s identity, data and control integrity, and services traversing the cloud. A device can no longer be looked at as an island; it is a part of a system. In fact, given the cross-domain interactions enabled by IoT it could be a part of many systems. Also, depending on where the device is deployed, for example, in the office building versus a factory floor or oil field, security ha...
Dec. 8, 2016 07:45 PM EST Reads: 334
Amazon has gradually rolled out parts of its IoT offerings in the last year, but these are just the tip of the iceberg. In addition to optimizing their back-end AWS offerings, Amazon is laying the ground work to be a major force in IoT – especially in the connected home and office. Amazon is extending its reach by building on its dominant Cloud IoT platform, its Dash Button strategy, recently announced Replenishment Services, the Echo/Alexa voice recognition control platform, the 6-7 strategic...
Dec. 8, 2016 07:15 PM EST Reads: 393
"Qosmos has launched L7Viewer, a network traffic analysis tool, so it analyzes all the traffic between the virtual machine and the data center and the virtual machine and the external world," stated Sebastien Synold, Product Line Manager at Qosmos, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Dec. 8, 2016 06:45 PM EST Reads: 957
Without a clear strategy for cost control and an architecture designed with cloud services in mind, costs and operational performance can quickly get out of control. To avoid multiple architectural redesigns requires extensive thought and planning. Boundary (now part of BMC) launched a new public-facing multi-tenant high resolution monitoring service on Amazon AWS two years ago, facing challenges and learning best practices in the early days of the new service. In his session at 19th Cloud Exp...
Dec. 8, 2016 05:45 PM EST Reads: 951
Everyone knows that truly innovative companies learn as they go along, pushing boundaries in response to market changes and demands. What's more of a mystery is how to balance innovation on a fresh platform built from scratch with the legacy tech stack, product suite and customers that continue to serve as the business' foundation. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, discussed why and how ReadyTalk diverted from healthy revenue and mor...
Dec. 8, 2016 05:45 PM EST Reads: 1,726
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...
Dec. 8, 2016 05:00 PM EST Reads: 1,822