ZURICH (Reuters) – Syngenta Group, the Swiss agrochemicals company which aims to raise $10 billion from an initial public offering later this year, increased its second quarter sales by 28%, the Chinese-owned company said on Thursday.
Sales rose 28% to $7.4 billion during the three months to June 30, helped by farmers restocking their inventories of seeds and pesticides after reducing their spending last year as well as booming demand in China.
Earnings before interest, depreciation, tax and amortisation (EBITDA), increased 25% to $1.2 billion, as Syngenta also sold more of its biological products which boast higher profit margins than conventional chemical sprays.
“Our teams have again delivered double-digit sales and strong profit growth across all our business units,” said Chief Financial Officer Chen Lichtenstein in a statement.
“We have launched innovative products, tapped into growth synergies for the Group, controlled costs, and managed to meet the increased demand of our customers even as the pandemic continues.”
Syngenta, which competes with Germany’s Bayer and U.S. agrochemicals company Corteva said it had seen strong demand from farmers buying products to overcome difficult weather conditions like droughts in the Americas, cold snaps in Europe and floods worldwide.
Sales in China increased by 46% as Syngenta added more Modern Agricultural Platform (MAP) centres, which sell products and provide training, by 87 to 413.
Syngenta, which was bought by state-owned ChemChina for $43 billion in 2017 – did not give further details on its planned IPO, which is set to be the biggest flotation in the world this year.
The parent company posted its prospectus on Shanghai’s Nasdaq-style STAR market in June, with the intention of floating by the end of 2021. The flotation will value Syngenta Group at around $60 billion including debt, or $50 billion without debt.
(Reporting by John Revill, editing by Silke Koltrowitz)
