36% profit rise forecast at AgrEvo
IMPROVED sales of insecticides, fungicides and herbicides are expected to help agrochemical manufacturer AgrEvo lift operating profit by 36% to reach £87m (DM 200) this year.
Global sales are predicted to total £1.63bn (DM 3.75bn) in 1996, up 11% on last year, reflecting stronger sales in North and South America, Korea, India, Pakistan and Australia. European sales account for 45% of the total.
Research and development investment, at £174m (DM 400m), will account for 11% of turnover. But investment in biotechnology products will lead to rapid growth in the companys R & D budget.
Before the acquisition of the Dutch/Belgian plant biotechnology outfit Plant Genetic Systems International last August, about 6% of research spending was devoted to biotechnology. But that is expected to rise to 25% within the next five years, said company chairman Gerhard Prante.
"Within 10 years we expect plant and biotechnology products and methods to generate additional sales of over DM 1bn (£400m) per year," he said. This revenue will arise mainly from sales of Liberty Link varieties of maize, oilseed rape, soya bean, sugar beet and cotton, which are tolerant to the companys herbicide glufosinate-ammonium.
Director for personnel and administration, Peter Henkel, said the company remained vulnerable to fluctuating exchange rates. To offset the effects of currency factors the company plans to continue its efforts to improve efficiency and cut costs by £130m (DM 300m) before 1999.
Since the formation of AgrEvo on Jan 1, 1994, from the crop protection businesses of Hoescht and Schering, the workforce has been cut by about 1300, the number of production and formulating sites cut from 39 to 26 and research and marketing activities centralised.n