Suedzucker Q1 profit jumps, expects higher earnings for current year (updated)

CropEnergies AG

07/07/2022 07:01

(Adds detail, expected sugar price rises)
    HAMBURG, July 7 (Reuters) - Europe's largest sugar producer
Suedzucker  SZUG.DE  posted a sharp surge in first-quarter
operating profit on Thursday and confirmed increased earnings
forecasts for its new fiscal year, despite the impact of the
Ukraine war.
    Suedzucker said in a statement operating profits in the
first quarter of its new 2022/23 year that started on March 1
rose to 163 million euros ($166.23 million) from 49 million
euros a year earlier.
    The result was driven by good results from the sugar,
starch, and fruit sectors and Suedzucker unit CropEnergies
 CE2G.DE , which produces the green fuel bioethanol, and has
benefited from higher energy prices, it said.
    The company confirmed it expected full-year 2022/23
operating profits of 400 million to 500 million euros from 332
million euros in the previous year.  urn:newsml:reuters.com:*:nL8N2Y22WZ  urn:newsml:reuters.com:*:nL5N2WC3XR 
    In Europe, higher prices for alternative crops are expected
to lead to a further decline in sugar beet cultivation with a
smaller harvest, it said. 
    "The EU is therefore expected to remain a net importer in
the 2022/23 sugar marketing year, creating a positive market
environment for Suedzucker that should allow the drastic
increase in raw material and energy costs to be passed onto the
market through significant sugar price increases starting in
October 2022," it said.
    It expects to transfer heavy recent cost increases,
particularly in raw materials and energy, to new customer
contracts.
    "The underlying assumptions are still that the Ukraine war
will be temporary and remain regionally contained, that despite
the current developments physical supplies of energy and raw
materials will be guaranteed and that the target and procurement
markets will at least partly return to more normal conditions
over the course of fiscal 2022/23," Suedzucker said.
    The sugar sector made a quarterly 1 million euro operating
profit, from a 25 million euro loss in the same year ago period.
($1 = 0.9806 euros)

 (Reporting by Michael Hogan, Editing by Paul Carrel and Rashmi
Aich)
 ((michael.j.hogan@thomsonreuters.com; +49 172 671 36 54;
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