KWS SAAT AG again grows net sales and earnings

(Einbeck, October 30, 2008/No.33/gf) – KWS SAAT AG (ISIN: DE 0007074007), one of the world’s leading seed companies, again grew strongly and profitably in the financial year ended on June 30, 2008.The Group’s net sales increased by 11.4% to €599.1 million. Earnings before interest and taxes (EBIT) increased by 9.7% to €70.1 million. Net income – aided by a positive financial result – was €54.6 (38.2) million, from which a dividend of €1.70 (€1.40) a share is to be distributed. Earnings per share improved to €7.74 (€5.61).

Corn business clearly exceeds expectations
Corn, which is now the Group’s largest segment, grew more strongly than expected in fiscal 2007/2008. “We have greatly increased our net sales in the corn segment, particularly in the strategic growth region of Southeastern Europe, but also in Germany and France,” said Philip von dem Bussche, Chairman of the Executive Board of KWS SAAT AG. “Net sales in the sugarbeet segment were just under the figure for the previous year, as we largely compensated for the expected decline in net sales in the European Union with our sales of genetically improved seed in the U.S. Cereals business has picked up nicely.”

Growth in Germany and abroad
In terms of volumes, KWS grew almost equally strongly in Germany and abroad. Only the weaker dollar caused net sales in foreign countries expressed as a ratio of total sales to fall by one percent to 75%. At the previous year’s exchange rates, the KWS Group’s net sales would have been 4% higher.

Cash and cash equivalents increase by two-thirds to €113 million´
The KWS Group’s great financial strength is also reflected in its net cash from operating activities, which increased by 46% to €75 million. The free cash flow was €57 million – more than double the previous year’s figure. Cash and cash equivalents increased by two-thirds to €113 million. “With an equity ratio of nearly 60% and net cash of €106 million, KWS is solidly financed. That puts KWS in a good position to deal with turbulence in the financial markets,” remarked CFO Hagen Duenbostel.

Employees are the foundation of the company’s success
2,856 (2,739) employees worked for the KWS Group worldwide in fiscal 2007/2008, 860 (777) of them at KWS SAAT AG. Solid training and the continuing development of junior staffers form the basis of KWS’ future. For many years, the company has trained young people in numbers in excess of what it itself needs. In the fiscal year just ended, 75 (72) apprentices and 10 (12) trainees were employed by KWS SAAT AG alone.

Outlook: growth to continue
KWS will continue to increase its net sales in the current fiscal year 2008/2009. “We currently expect to grow net sales by up to 10%, with all our segments contributing,” said von dem Bussche. “The higher cost of sales means it will be a considerable challenge to match the previous year’s outstanding results, but that is our goal.” As a medium-sized company with a long tradition of family ownership, the focus of KWS’ corporate strategy is to secure jobs and increase the company’s value for the long term.

The product segments in detail:

In € million (at 30 June)	2007/2008	Previous year
Consolidated net sales	599.1	537.9
Sugarbeet	194.8	199.9
Corn	328.9	275.5
Cereals	67.4	54.5
Breeding & services	8.0	8.1
Consolidated operating income (EBIT)	70.1	63.9
Sugarbeet	28.1	35.1
Corn	23.2	13.3
Cereals	9.0	5.3
Breeding & services	9.8	10.1
Net income for the year (Group)	54.6	38.2
Operative cash flow	74.6	51.1

Contact:
Cord Warnecke
Phone: +49 (0)5561 / 311-622
E-mail: c.warnecke@kws.com