The Syngenta Group consists of four business units, Syngenta Crop Protection, ADAMA, Syngenta Seeds and Syngenta Group China and was only formed on 18 June 2020.
Combines sales results for the four business units topped just over US$12 billion for 6 months and this was a 2% combined increase over the same period last year for each identity, prior to the Group being formed.
Erik Fyrwald, Syngenta Group CEO had this to say about the result: “The last few months have been a very challenging time for everybody on this planet. I am pleased that our team delivered strong performance across all of Syngenta Group’s business units despite the COVID-19 pandemic, low grain prices and significant currency headwind.
“This demonstrates that our strategy to deliver the broadest range of sustainable, innovative, and competitive products and services to farmers worldwide is robust, even in these extraordinary times. Our goal is to be a supplier that our customers can always rely on despite any challenges.”
And while the sector full year outlook remains challenging, with low grain prices and currency headwinds in developing markets, and COVID-19 pandemic impacts. The Syngenta Group says it remains committed to achieving underlying growth and leadership in sustainable agricultural innovation.
Sales in the four business division across 6 months showed Syngenta Crop Protection accounted for the bulk of sales with US$5.477 billion, then followed ADAMA with US$2 billion in sales, then Syngenta Seeds US$1.62 billion, Syngenta Group China US$3.35 billion, with the balance of $US$414 million being adjustments and write-downs to record total revenue of US$12.041 billion.
Syngenta Crop Protection
Total sales in Syngenta’s Crop Protection business grew 6% to US$5.5 billion, with growth in all regions.
Sales in Europe, Africa and the Middle East were 5% higher CER with a solid performance in the region despite dry weather in North-West Europe. Reported sales were reduced by exchange rate impact.
In North America, sales were up 4% constrained by cold weather and excessive rain in the second quarter.
Sales in Latin America grew 10%, maintaining the positive momentum in the region. Pest pressure in Brazil remains strong. The growth was partly offset by the negative impact of exchange rates.
In Asia Pacific, sales were up 12% CER with a strong performance in Australia following improved weather conditions and continued momentum in India.
Exchange rate headwinds reduced reported sales to 8 percent. In China we continued positive momentum, increasing sales by 18 percent CER, driven by the successful launch of Adepidyn.
In the first half of 2020, ADAMA delivered total sales of US$2 billion, in line with the prior year but 7% higher CER.
Sales in Europe were in line with last year CER, with higher inventories in distribution channels remaining from the poor season last year alongside COVID-19 concerns, both constraining demand and increasing pricing pressure.
India, Middle East and Africa has seen 18% growth CER, driven mainly by favourable weather particularly in India and South Africa. Foreign exchange weaknesses with the Indian Rupee, Turkish Lira and the South African Rand were partially offset by price increases.
Sales in North America declined 6% CER challenged by weather conditions, primarily in the South, which delayed planting and reduced cotton acreage alongside a reduction in cotton demand due to lower retail apparel sales as a result of COVID-19.
In Latin America sales grew 28% CER due to strong performance in Brazil, Argentina, Paraguay and Peru and despite the significant regional exchange rate headwinds, most notably seen in the volatility and weakness in the BRL.
Sales in Asia Pacific (excluding China) grew 9% CER with positive seasonal conditions in Australia largely offset by poor conditions in Southeast Asia and exchange rate headwinds.
China sales were 3% lower than prior year CER, with a 15% increase in branded, formulated sales challenged by disruption in the Hubei manufacturing base.
Syngenta Seeds business unit grew sales 2% (4% at CER) to $1.6 billion. Underlying growth was 7%.
Sales in Europe, Africa and the Middle East were in line with last year. Strong seasonal growth was impacted by Corn supply challenges.
In North America, sales were up 13% with an increase in Soy market share. Sales were supported by a recovery of both Corn and Soy growing areas which were flooded in 2019.
Sales in Latin America grew by 27% CER. Currency headwinds in Brazil were more than offset by higher royalty incomes and strong orders across the region.
In Asia Pacific, sales continued to grow across all geographies, partially offset by exchange rate headwinds.
The global Vegetable business grew in all regions, resulting in 9% higher sales CER.
Syngenta Group China, encompassing crop protection, crop nutrition, seeds, MAP and Digital business, generated sales of $3.4 billion, with an underlying growth of 3% compared to the previous year despite lower selling prices of crop nutrition.
The Modern Agricultural Platform (MAP) continued to expand nationwide adding 81 new locations to reach a total of 234 sites. Sales nearly tripled to $271 million. The MAP service area expanded to a total of 2.72 million hectares with 265,000 users and strategic cooperation with Alibaba’s HEMA “Freshippo” network and Wilmar. MAP is a key contributor to synergies with other Syngenta Group China businesses.
Syngenta Group China’s Crop Protection businesses grew sales by 12% CER driven by new product launches and growth in branded, formulated products.
Seeds sales were up 7% CER, profiting from the acquisition of a new corn hybrid.
Crop Nutrition (Sinofert) sales were 15% lower (11 percent CER) due to reduced selling prices. Volume increased by 5% and product mix improved with focus on specialty fertilizer products. Profit margin was maintained through cost reduction and mix improvement.