Suedzucker quarterly profits surge, sees higher full-year earnings (updated)

CropEnergies AG

13/10/2022 07:02

(Adds detail, comment)
       HAMBURG, Oct 13 (Reuters) - Europe's largest sugar
producer Suedzucker  SZUG.DE  on Thursday posted a rise of
almost 80% in quarterly earnings and again forecast increased
full-year profits, despite higher energy and raw materials
costs, supported by the strong performance of its sugar and
biofuel sectors.
    The company expects to be able to pass on higher costs in
increased sugar prices but its performance in coming months will
depend on sufficient energy supplies being available after
Russia cut gas deliveries to Europe, it said.
    Suedzucker said operating profit in the second quarter to
the end of August of its 2022/23 fiscal year rose 79.5% to 153
million euros ($148.44 million).
    A strong performance by its biofuels unit CropEnergies
 CE2G.DE  supported, it said. 
    Suedzucker repeated its forecast in August of a 2022/23
full-year operating profit of 450 million euros to 550 million
euros, up from 332 million euros the previous year. 
    The European Union will remain a net sugar importer in the
2022/23 season and Suedzucker will enjoy a positive market
environment, the company said. 
    "This should enable Suedzucker to pass on the drastic
increase in raw material and energy costs with significant sugar
price increases beginning in October 2022," it said.
    In Europe, the sugar beet area for the crop this winter is
down by about 4% on the year, it said.
    "World and EU sugar prices continue to rise and we are
confident we will achieve a further improvement in prices for
Suedzucker’s production in coming months," a Suedzucker
spokesperson told Reuters. 
    "This year’s sugar harvest processing campaign started in
September and is so far progressing well, rain in recent weeks
in Germany could provide a late positive impact on crops.”
    Suedzucker has in past years been actively seeking more gas
use as part of its carbon-reduction programme.
    "In past months, alternative energy sources to gas have been
assessed for all our sugar factories such as coal or oil,” the
spokesman said. “But we are still predominantly using gas.”
 (Reporting by Michael Hogan, editing by Miranda Murray, Robert
Birsel)
 ((michael.j.hogan@thomsonreuters.com; +49 172 671 36 54;
Reuters Messaging:
michael.hogan.thomsonreuters.com@reuters.net))