ZURICH (Reuters) – Swiss agrichemicals and seeds group Syngenta on Wednesday reported a 25% drop in fourth quarter earnings due to higher raw materials and energy costs.
Syngenta, which plans to list within the next few months, also spent more on reorganising its business and set cash aside to cover macro-economic uncertainties such as further raw material spikes or potential bad debts by customers.
The Chinese-owned company said its earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 25% to $900 million in the three months to the end of December.
Sales rose 4% to $7.5 billion boosted by strong growth in its seeds business.
“As previously indicated, farmers accelerated their purchases earlier in the year due to supply concerns, moderating fourth quarter growth,” the company said.
“The group continued to maintain higher prices necessary to offset elevated raw material and other costs,” it added.
During 2022 Syngenta’s sales increased 19% to $33.4 billion while EBITDA rose 20% to $5.6 billion.
Much of the growth came from China, where the company added 136 more MAP training and sales centres to take its total to 628 sites.
Syngenta, which competes with U.S. company Corteva and Germany’s BASF and Bayer, was bought in 2017 for $43 billion by ChemChina, which was folded into Sinochem Holdings Corp in 2021.
The parent company plans to keep a majority stake after its $10 billion flotation, which is expected to value Syngenta at around $50 billion.
(Reporting by John Revill; editing by John O’Donnell)
