Syngenta 2012 Full Year Results

Wed Feb 6, 2013 1:00am EST

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Continued sales momentum and record earnings
BASEL, Switzerland,  Feb. 6, 2013  /PRNewswire/ --

* Sales  $14.2 billion, up 7 percent; up 10 percent at constant exchange rates
(CER)1

* strong fourth quarter in North and  Latin America
* double digit Seeds growth in all regions (CER)

* EBITDA up 17 percent at CER  
* Net income  $1.9 billion, up 17 percent
* Earnings per share2$22.30, up 15 percent
* Free cash flow before record level of acquisitions:  $0.9 billion
* Proposed dividend increased by 19 percent to  CHF 9.50

                      Reported Financial Highlights              
                      2012      2011      Actual    CER1      
                      $m        $m        %         %         
 Sales                14,202    13,268    + 7       + 10      
 Operating income     2,292     2,051     + 12                
 Net income3          1,872     1,599     + 17                
                                                              
 EBITDA               3,150     2,905     + 8       +17       
 Earnings per share2  $22.30    $19.36    + 15                
                                                              
 1  Growth at constant exchange rates                             
 2  Excluding restructuring and impairment; EPS on a fully-diluted basis. 
 3  Net income to shareholders of Syngenta AG (equivalent to diluted earnings per share of $20.32). 


Mike Mack, Chief Executive Officer, said:

"In 2012, crop prices rose sharply as adverse weather conditions in several
regions resulted in significant production shortfalls, once again highlighting
the fragility of global supply.  Growers in the affected regions had to adapt
quickly in terms of planting and investment decisions, while also dealing with
ongoing challenges such as weed and insect resistance.  The strong growth in
Syngenta's sales reflected our flexibility in providing solutions across crops
and, increasingly, in addressing agronomic challenges through our integrated
offers.  These are proving their worth in developed and emerging regions alike,
contributing to growth rates of eight percent and 11 percent respectively.

"Since the announcement of our new strategy two years ago, we have been driving
the development of our portfolio by crop.  The results already achieved in the
field and the potential for new integrated offers have enabled us to increase
target sales for our eight strategic crops to  $25 billion  by 2020.  In
addition, last year we made a number of acquisitions to secure new technologies.
 We were able to do so while maintaining a strong balance sheet as evidenced by
the proposal of another substantial increase in the dividend."

Financial highlights 2012

Sales  $14.2 billion
Sales increased by ten percent at constant exchange rates.  Sales volume
increased by seven percent and prices were three percent higher.  Reported sales
growth was seven percent owing to the appreciation of the dollar against most
currencies.

EBITDA  $3.2 billion
At constant exchange rates EBITDA increased by 17 percent and the EBITDA margin
(CER) was 23.2 percent (2011: 21.9 percent).  The increase in profitability
reflects the operational leverage from volume growth, price increases and the
recognition of an additional $200 million of trait royalty from DuPont Pioneer,
accompanied by cost savings largely from the integrated business model of $198
million.  These together more than offset the impact of higher raw material
costs and a net $80 million charge for the settlement of US litigation relating
to the herbicide atrazine.  

The reported margin was 22.2 percent.  The negative impact of currency was  $235
million, or 100 basis points.

Net financial expense and taxation
Net financial expense of  $147 million  was slightly lower than in 2011 ($165
million).  The tax rate before restructuring and impairment was 15 percent.

Net income  $1.9 billion
Net income including restructuring and impairment was up 17 percent.  Earnings
per share, excluding restructuring and impairment, increased by 15 percent to 
$22.30.

Cash flow and balance sheet
Free cash flow before acquisitions totaled  $924 million.  Average trade working
capital as a percentage of sales was further reduced to 35 percent from 37
percent in 2011. Fixed capital expenditure including intangibles was  $679
million  (2011: $575 million) reflecting increased investment to meet growing
demand, notably in the emerging markets.  Acquisition spending reached  $654
million, with opportunities to acquire new technologies and to expand seeds
production capability.  Cash flow return on investment at 15 percent again
exceeded the 12 percent target.  The ratio of net debt to equity was 20 percent
(2011: 15 percent).  

Dividend and share repurchase  
The total cash return to shareholders in 2012 was  $795 million.  The dividend
was raised by 14 percent, or 13 percent in US dollars, to give a total dividend
payout of  $791 million.  Share repurchases amounted to  $4 million: the primary
focus is on the dividend and in 2012 there was significant expenditure on
acquisitions.

In the light of continuing strong free cash flow generation, the Board of
Directors will propose to the AGM on  April 23, 2013  an increase in the
dividend to  CHF 9.50  per share from CHF 8.00 in 2011.  This represents an
increase of 19 percent in Swiss francs and around 21 percent in US dollars at
end January exchange rates.  As in previous years, the company retains the
flexibility to execute tactical share buybacks.

Business Highlights 2012

                               Full Year        Growth           4th  Quarter       Growth         
                               2012    2011    Actual  CER     2012     2011     Actual  CER   
                               $m      $m      %       %       $m       $m       %       %     
 Europe, Africa & Middle East  3,974   3,982   -       + 6     387      414      - 7     - 3   
 North America                 3,931   3,273   + 20    + 21    690      538      + 28    + 28  
 Latin America                 3,713   3,305   + 12    + 13    1,556    1,324    + 18    + 17  
 Asia Pacific                  1,827   1,887   - 3     -       432      443      - 3     - 1   
 Total regional sales          13,445  12,447  + 8     + 11    3,065    2,719    + 13    + 13  
 Lawn and Garden(1)            757     821     - 8     - 6     174      184      - 6     - 5   
 Group sales                   14,202  13,268  + 7     + 10    3,239    2,903    + 12    + 12  


Regional sales performance

* Sales  $13.4 billion, up 11%(2)
* Volume +8%, price +3%
* EBITDA  $3.0 billion  (2011:  $2.8 billion)
* EBITDA margin(2)  23.8% (2011: 22.5%)

(1) Including impact of divestments
(2) At constant exchange rates

Europe,  Africa  and the  Middle East:  Growth was broad-based with the
strongest contributions to growth coming from the CIS and  South East Europe,
where commercial integration is driving clear gains in scale and in customer
recognition of our portfolio.  Seeds sales were in addition driven by the
substitution of corn and sunflower for lost winter cereal crops.   France  also
registered a strong full year performance led by growth in fungicides.  Sales in
southern  Europe  were lower owing to dry weather as well as the economic
downturn.

North America  had an excellent year across the business.  The expansion of our
corn technology resulted in good underlying seeds sales growth which was
augmented by licensing revenue.  A warm winter and an early planting season
favored the use of herbicides and insecticides, with further momentum coming
from the ongoing success of our weed and insect resistance management programs. 
This more than offset a reduction in third quarter fungicide applications due to
the summer drought.  Low channel inventories and strong demand in advance of the
2013 season led to an acceleration of growth in the fourth quarter.

Latin America  staged a strong recovery from drought conditions which reduced
sales in the first quarter.  High soybean prices encouraged increases in acreage
and investment.  The development of second season corn is favoring technology
adoption in both crop protection and seeds.  The traction resulting from the
early integration of our commercial teams in  Brazil  has added impetus to the
growth in our seeds portfolio, with share gains in both corn and soybean.  The
need to boost sugar cane productivity was reflected in strong growth in
herbicide sales and the identification of new opportunities in seedlings and
young plants.

Asia Pacific:  Sales excluding the impact of range rationalization and
registrations increased five percent.   China  and  South East Asia  both
reported double digit growth with expansion in corn and the roll-out of DURIVO® 
insecticides.  Growth in  South Asia  was more moderate owing to an erratic
monsoon and to the product phase-outs which also affected sales in Japan.  Sales
in Australasia were lower owing to early floods followed by exceptionally hot
and dry conditions in the second half of the year.

Lawn and Garden performance

* Sales  $757 million, 6% lower(1)
* EBITDA  $103 million  (2011:  $103 million)
* EBITDA margin(1)  13.9% (2011: 12.5%)

(1) At constant exchange rates

Excluding the impact of acquisitions and divestments, sales were broadly flat.  
While low consumer spending and cautious retailer behavior continued to affect
many markets, we made significant progress in simplifying the business and
focusing on high value chemistry and genetics.  This included the divestment of
some lower margin businesses including Fafard growing media, which in June was
sold to Sun Gro Horticulture Canada Ltd., with whom we continue to collaborate
in order to include growing media in our integrated offers.  In November we
announced that Griffin Greenhouse Supplies, Inc., will acquire the Syngenta
Horticultural Services flowers distribution and brokerage business.  The
acquisition of the DuPont Professional Products insecticide business will
augment our portfolio of chemical controls with the established Advion®  and
Acelepryn®  brands.

Capacity expansion

In  Argentina, Syngenta announced a  $50 million  investment to build a new
processing plant for corn and sunflower seeds.  In  Brazil, the company plans to
quadruple the capacity of its Formosa corn processing plant.  Syngenta has also
signed a letter of intent to invest up to  $85 million  in the construction of a
hybrid seed and crop protection facility in Krasnodarskiy Krai in  Russia.


Acquisitions

The DuPont Professional Products business (see under Lawn and Garden) was
acquired for  $125 million  and consolidated with effect from  October 2012.

In September Syngenta agreed to pay  $86 million, with additional deferred
payments of up to  $27 million, for Pasteuria Bioscience Inc.  The naturally
occurring soil bacteria Pasteuria spp will be used to develop cost-effective
nematicides with a novel mode of action.

In November Syngenta commenced a tender offer valued at €403 million for the
Belgian company Devgen, a global leader in hybrid rice and RNAi technology.  By 
January 18, 2013, 98.32 percent of the total number of shares in Devgen had been
tendered; the remaining shares will be acquired through a squeeze-out.  The
acquisition, which was consolidated from  December 2012, will reinforce
Syngenta's leading position in the global rice market and will enable the
combination of RNAi-based crop applications with our broad crop protection
portfolio.

Also in November, Syngenta announced the acquisition of Sunfield Seeds, a
US-based provider of sunflower seeds production and processing services.  The
acquisition will strengthen our sunflower supply capability in support of future
growth.

New partnerships:  Syngenta and Novozymes signed two global agreements in 2012. 
Firstly, the two companies will jointly commercialize the Novozymes technology
JumpStart®, a seed-applied biological which increases phosphate uptake in the
soil.  A second marketing and distribution agreement relates to Taegro®, a
fermented biological fungicide which offers growers broad-spectrum disease
control at low application rates.  

Under a barley breeding agreement with Intergrain, Syngenta has gained exclusive
commercialization rights for all new barley varieties, and exclusive rights to
commercialize existing Intergrain varieties outside  Australia.

Crop pipelines:  In September, Syngenta upgraded its sales target for its eight
key crops to  $25 billion  by 2020.  This compares with a previous target of
over  $22 billion  post-2015.  The upgrade followed strategic updates covering
four of the crops: Cereals, Corn, Rice and Vegetables.  The sales target
comprises growth in the existing portfolio and the launch of new products, with
an increasing emphasis on integrated offers.

Performance  metrics:  The performance of our portfolio and the development of
our integrated offers enabled us to gain further market share in 2012.  This
supports our confidence in achieving the target of an annual average 0.5 percent
market share gain across the combined business over the next five years.  In
2012the group EBITDA margin of 22.2 percent was within the target range of 22-24
percent set for 2015.  This achievement is against a backdrop of currency and
raw material headwinds as well as ongoing investments in growth.  Cash Flow
Return on Investment at 15 percent was significantly ahead of the targeted rate
of over 12 percent.  These results are reflected in the proposed dividend
increase, in line with our strategy of returning cash to shareholders.

Outlook

Mike Mack, Chief Executive Officer, said:
"Our confidence in the coming season is reinforced by the fourth quarter
business strength, notably in North and  Latin America, as well as robust
commodity crop prices.  In 2013 we look forward to further business momentum
driven by our innovative offers and a commercial organization which is now fully
integrated in all territories.  We also expect to generate significant free cash
flow, while continuing to invest in the realization of our crop-based pipelines
and in the ongoing expansion of our commercial footprint, notably in the
emerging markets."


Crop Protection

                           Full Year       Growth           4th  Quarter       Growth         
 Crop Protection           2012    2011   Actual  CER     2012     2011     Actual  CER   
 by product line           $m      $m     %       %       $m       $m       %       %     
 Selective herbicides      2,939   2,617  +12     + 15    589      417      + 41    + 42  
 Non-selective herbicides  1,246   1,117  + 12    + 14    298      231      + 29    + 29  
 Fungicides                3,044   2,998  + 2     + 4     758      704      + 8     + 8   
 Insecticides              1,841   1,790  + 3     + 6     513      496      + 4     + 4   
 Seed care                 1,107   1,018  + 9     + 12    320      332      - 3     - 3   
 Other crop protection     141     137    + 2     + 5     36       39       - 10    - 10  
 Total                     10,318  9,677  + 7     + 9     2,514    2,219    + 13    + 14  


Selective herbicides:  major brands AXIAL®, CALLISTO®  family, DUAL®/BICEP® 
MAGNUM,  FUSILADE®MAX, TOPIK®

AXIAL® on cereals registered double digit growth in all regions.  The largest
contribution came from  Canada, where increased acreage coincided with low
channel inventories at the start of the year.  In corn, the CALLISTO®  family
and DUAL®/BICEP®  grew strongly in the  USA  driven by their success in managing
resistant weeds as well as high corn prices.  Adoption of both products on sugar
cane in  Brazil, where they form part of integrated agronomic protocols, is
accelerating rapidly.   

Non-selective herbicides:  major brands GRAMOXONE®, TOUCHDOWN®

GRAMOXONE® showed good growth in  Latin America  and the  USA, where it was used
as an alternative to glyphosate in areas of weed resistance.  Sales in the
developed markets of  Asia Pacific  were lower, partly due to non-renewal of the
registration in South Korea.  TOUCHDOWN® sales grew strongly notably in the
Americas reflecting a high level of demand on corn and soybean and a shortage of
generic supply.    

Fungicides:  major brands ALTO®, AMISTAR®, BRAVO®, REVUS®, RIDOMIL GOLD®,
SCORE®, TILT®, UNIX®   

Fungicide sales progressed despite drought in  Latin America  in the first
quarter and in the  USA  throughout the summer.  The largest product AMISTAR®
continues to expand: volume growth was driven by our offer comprising multiple
mixtures and formulations adapted by crop and geography, and pricing remained
robust.  Sales of REVUS® for vegetables, vines and potatoes were up by 25
percent in  Europe, its main market.  In November, the European Union granted
full approval for isopyrazam, which will represent a major step forward in the
control of a wide variety of damaging fungal diseases.

Insecticides:  major brands ACTARA®, DURIVO®, FORCE®, KARATE®, PROCLAIM®,
VERTIMEC®

Excluding the impact of range rationalization, sales were up 10 percent led by
the Americas.  In the  USA, a mild winter and dry weather throughout the corn
belt created heavy early insect pressure.  In addition, grower awareness of corn
rootworm resistance and of the benefits of soil-based insecticides increased,
with North American sales of FORCE® more than doubling as a result.  Latin
American growth was driven by technology adoption, with the strongest
contributions coming from ACTARA® and DURIVO®.

Seed care:  major brands AVICTA®, CRUISER®, DIVIDEND®, CELEST/MAXIM®, VIBRANCE

Global growth was led by CRUISER® and CELEST/MAXIM®.  Ongoing technology
adoption drove a particularly strong performance in the emerging markets, where
sales were up by over 20 percent.  In Latin America the nematicide AVICTA®  also
showed strong growth.  VIBRANCE, a new compound which delivers enhanced root
health as well as controlling a wide range of diseases, was successfully
launched in  North America.

                            Full Year       Growth           4th  Quarter       Growth         
 Crop Protection            2012    2011   Actual  CER     2012     2011     Actual  CER   
 by region                  $m      $m     %       %       $m       $m       %       %     
 Europe, Africa, Mid. East  2,910   2,958  - 2     + 5     325      354      - 8     - 5   
 North America              2,577   2,158  + 19    + 20    422      286      + 47    + 47  
 Latin America              3,261   2,907  + 12    + 13    1,411    1,208    + 17    + 17  
 Asia Pacific               1,570   1,654  - 5     - 2     356      371      - 4     - 3   
 Total                      10,318  9,677  + 7     + 9     2,514    2,219    + 13    + 14  


Seeds

                      Full Year      Growth           4th  Quarter       Growth         
 Seeds                2012   2011   Actual  CER     2012     2011     Actual  CER   
 by product line      $m     $m     %       %       $m       $m       %       %     
 Corn and Soybean     1,836  1,471  + 25    + 26    386      334      + 15    + 15  
 Diverse Field Crops  719    676    + 6     + 11    66       77       - 14    - 12  
 Vegetables           682    703    - 3     + 1     148      131      + 14    + 15  
 Total                3,237  2,850  + 14    + 16    600      542      + 11    + 11  


Corn and Soybean:  major brands AGRISURE®, GARST®,  GOLDEN HARVEST®, NK®

Sales were up strongly in all regions driven by corn worldwide and by soybean in
Latin America.  North American sales were augmented by additional corn trait
royalty income of around  $200 million  received in the first half; excluding
this amount global corn sales were up 15 percent, with a positive customer
response to our broad technology offer.  In Latin America corn growth was driven
by the expansion of the second season in  Brazil, where sales were up by more
than 30 percent helped by the launch of new trait combinations.  Increases in
soybean acreage for the 2012/13 season have been accompanied by strong demand
for our leading varieties such as V-Max.  The integrated PLENUS®  offer is
growing well in  Argentina  where it now accounts for around three quarters of
the portfolio.

Diverse Field Crops:  major brands NK® oilseeds, HILLESHOG®  sugar beet

Growth was led by sunflower in  Eastern Europe  where we are capturing value
from the expansion of our leading conventional and high oleic hybrids.  In North
America, growth in sunflower and cereals more than offset the disposal of the
sorghum business.  Hybrid barley is starting to make a significant contribution
in major Western European countries, alongside growth in the existing wheat
business.


Vegetables:  major brands DULCINEA®, ROGERS®, S&G®

There was an upturn in the fourth quarter which offset the earlier impact of a
difficult economic environment.  In North America, the processing market has
recovered from a period of oversupply and fresh produce sales are benefiting
from strong demand for miniature watermelons.  In  Mexico  and Iberia, Zeraim's
leading tomato and pepper varieties are driving sales.

                            Full Year      Growth           4th  Quarter       Growth         
 Seeds by region            2012   2011   Actual  CER     2012     2011     Actual  CER   
                            $m     $m     %       %       $m       $m       %       %     
 Europe, Africa, Mid. East  1,101  1,063  + 4     + 10    83       86       - 3     - 1   
 North America              1,398  1,142  + 22    + 22    292      266      + 10    + 9   
 Latin America              479    409    + 17    + 18    148      118      + 26    + 26  
 Asia Pacific               259    236    + 10    + 16    77       72       + 6     + 9   
 Total                      3,237  2,850  + 14    + 16    600      542      + 11    + 11  


Announcements and Meetings

 2012 Annual Report publication               March 13, 2013      
 First quarter trading statement              April 18, 2013      
 AGM                                          April 23, 2013      
 Crop update                                  July 9-11, 2013     
 First half results                           July 24, 2013       
 Third quarter trading statement              October 17, 2013    
 Crop update                                  December 4-6, 2013  


Syngenta is one of the world's leading companies with more than 27,000 employees
in over 90 countries dedicated to our purpose: Bringing plant potential to life.
 Through world-class science, global reach and commitment to our customers we
help to increase crop productivity, protect the environment and improve health
and quality of life.  For more information about us please go to 
www.syngenta.com.

Cautionary Statement Regarding Forward-Looking Statements

This document contains forward-looking statements, which can be identified by
terminology such as 'expect', 'would', 'will', 'potential', 'plans',
'prospects', 'estimated', 'aiming', 'on track' and similar expressions. Such
statements may be subject to risks and uncertainties that could cause the actual
results to differ materially from these statements. We refer you to Syngenta's
publicly available filings with the U.S. Securities and Exchange Commission for
information about these and other risks and uncertainties. Syngenta assumes no
obligation to update forward-looking statements to reflect actual results,
changed assumptions or other factors. This document does not constitute, or form
part of, any offer or invitation to sell or issue, or any solicitation of any
offer, to purchase or subscribe for any ordinary shares in Syngenta AG, or
Syngenta ADSs, nor shall it form the basis of, or be relied on in connection
with, any contract there for.

 Syngenta International AG  Media contacts:               Analyst/Investor contacts:         
                                                                                             
 Media Office               Paul Barrett                  Jennifer Gough                     
 CH-4002 Basel              Switzerland  +41 61 323 2323  Switzerland  +41 61 323 5059       
 Switzerland                                              USA               +1 202 737 6521  
 Tel:  +41 61 323 23 23                                                                      
 Fax:  +41 61 323 24 24     Paul Minehart                 Lars Oestergaard                   
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 www.syngenta.com                                         USA               +1 202 737 6520  
                                                                                             


SOURCE  Syngenta

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