The result of the 2016 financial year for BayWa AG was shaped by new records in fruit and renewable energy and a difficult market environment for agricultural trade and equipment. As a result, Klaus Josef Lutz, Chief Executive Officer of BayWa AG, underscored the importance of the conglomerate structure for BayWa in his speech at the 2017 Annual General Meeting. The international trading and services group generated €15.4 billion in revenues in 2016. Earnings before interest and tax (EBIT) totalled €144.7 million. Shareholders at the Annual General Meeting approved a dividend of €0.85 per share, the same as in the previous year.
Lutz provided an outlook for the current financial year. “The Group had a strong start in the first three months of 2017,” he said. During the first quarter, BayWa AG increased its earnings and revenues for all three core operating segments year on year. EBIT rose by €20.4 million to €8.0 million, and revenues increased by 9.8 percent to €3.8 billion. “We want to significantly increase the consolidated result once again in 2017,” Lutz said. He cited moderate agricultural trading markets and high volatility as those factors which continue to pose the greatest challenges to the Group. In terms of renewable energy, BayWa r.e.’s project pipeline is extremely well filled for 2017. Plans are in place for building, commissioning and selling solar parks and wind farms with 500 MW. “As a result, we can expect to see a very good result in this line of business for 2017 as well,” Lutz said. The Chief Executive Officer anticipates successful business performance for building materials in 2017 as well, thanks to robust construction activity.
One focus of the speech was on digitalisation, which is now “part of the BayWa Group’s DNA”. Lutz explained the establishment of the Innovation & Digitalisation Segment, which pools all of the activities from the fields of digital farming and e-business. “Through digitalisation, we find ourselves in the midst of an evolutionary revolution in all industries,” Lutz said. He added that the development comes with many benefits, noting that digital farming is one example of “how it is possible to reduce the tasks that farmers have to perform while helping them to increase the profitability of their farms.” Lutz acknowledged that there are understandable questions about future working environments as a result of digital change, but said he has little understanding when it comes to fundamental political and societal rejection of innovation. “While technological developments have often replaced certain human activities, new occupational profiles and jobs have been created either at the same time or in the aftermath.”
Lutz expects to see positive business performance for the current financial year. “If the underlying conditions begin to stabilise, especially in the agricultural markets, EBIT is likely to improve considerably year on year.”
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