Grene
Preferred supplier to agriculture Financial performance Grene increased revenue by 4% from DKK 1,307 million in 2011 to DKK 1,353 million in 2012. The improvement was driven by positive trends in all agro markets but one, Sweden, where some of the company’s industrial activities suffered a minor decline. The positive performance in an otherwise strained market can generally be ascribed to Grene’s considerable competitive strength, supported by a gradual expansion of its product portfolio and related logistics and IT systems. EBIT improved from DKK 87 million in 2011 to DKK 93 million in 2012 and ended a good deal higher than the latest guidance range. The year’s earnings performance was supported by the company’s activities in Denmark and Russia. On the other hand, Carsten Thygesen, operations in Sweden and in CEO, Grene Grene Industri-service suffered
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26
’09
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1,353
1,307
1,237
1,140
1,307
Revenue (DKKm)
’12
setbacks, while the remaining business areas reported results in line with last year. Working capital was kept at an unchanged level, and net interest-bearing debt fell slightly from DKK 438 million at December 31, 2011, to DKK 425 million at December 31, 2012. Business development Grene had a good year in 2012, even though current indications in the Agro business draw a rather complex picture. There are clear differences between the regions in terms of both weather-related and financial challenges. Precipitation and low temperatures have dominated weather conditions in the Nordic region, resulting in difficult field conditions, and the Danish agricultural sector suffers under the strain of a substantial debt burden. Generally, there is a sense of reluctance and uncertainty in the Nordic market, as reflected by a tendency among Grene’s customers to reduce their inventories and by a downward trend in the value per order line in orders received. However, this is also a trend that allows Grene to capitalise on its product delivery power and powerful logistics solutions. Weather conditions in Poland have been relatively dry, but harvests have been reasonable and the market continues to grow. Poland is one of the most attractive markets in Europe, and Grene successfully expanded its already strong position in 2012. Its Polish operations demerged into two units in 2012: one for wholesale and the other focused on retail business. The demerger has enabled a more focused approach in both areas. Grene launched a franchise concept in 2012 that, in addition to the 90 stores Grene already owns and operates, has led to 12 new stores under the Grene brand and carrying Grene’s product range. The positive revenue trend continued in Russia, where the activities are run in cooperation with Dutch business partner Kramp Groep. Russia is the largest agro market in Europe: It is highly unpredictable and there are large fluctuations from one year to the next, but considering Grene’s current modest market share, it has substantial growth potential. The expansion of warehouse facilities currently underway in Denmark is progressing to plan. The first phase of the project, involving a building extension of 3,250 m2, is now finished, and the second phase, involving additional automation solutions, is