ADAMA PROVIDES NET INCOME ESTIMATE FOR THE THIRD QUARTER
AND FIRST NINE MONTHS OF 2019
TEL AVIV, ISRAEL and BEIJING, CHI NA, October 13, 2019 – Leading global crop protection company
ADAMA Ltd. (the “Company”) (S ZSE 000553), today provided an estimate regarding its expected net income
for the third quarter and first nine months of 2019.
The Company is expecting to deliver record third quarter sales, with high-single digit growth in USD terms
and above 10% growth in RMB terms, compared to the same period last year. This strong top-line
performance is expected to drive the Company to report sales growth to a nine-month record-high,
overcoming the significant headwinds seen throughout the year.
In the third quarter, the robust performance was driven by strong business growth in almost all geographies,
together with continued increased prices, which were countered to some extent by adverse currency
movements. The Company continues to grow strongly in Brazil and the rest of Latin America, where its
port folio of differentiated products is driving increasing market penetration. The Company delivered a strong
performance in Europe, despit e the drought throughout the region. The third quarter saw a partial recovery in
Nort h America late in the season following the severe weather challenges seen in the first half of the year,
with notewort hy performance recorded in both the US and Canada. In China, ADAMA continues to record
significant double-digit sales growt h of its differentiated, formulated and branded products. This strong overall
growth comes despite the headwinds from the lack of high-demand products in many geographies due to the
disruption at the Jingzhou old site, which is gradually ramping up its operations.
The strong sales growth in the quarter was complemented by an improvement in portfolio mix, partially offset
by the impact of higher procurement costs. EBITDA is expected to be higher compared to the same period
last year, despite the lost profit from missing sales of products of the Jingzhou old site as well as the
recording of related idleness cost, albeit at a lower level as the site continues its incremental ramp-up of
production. Financial expenses are expected to be higher, partially offset by lower taxes.
Over the nine-month period, the Company expects to deliver t op-line growth reaching a record-high,
overcoming the significant mark et and supply headwinds encountered throughout the year. Leading
contribut ors to the growth are Latin America, led by Brazil, and North America, as well as the impact of the
strong, double-digit growth of the Company’s branded, formulated portfolio in China. The Company continues
to raise its prices in all regions and contain its manufacturing and other operating costs to mitigate the higher
procurement costs and supply-constrained environment.
Reported Estimated 9M 9M 2018 Estimated Q3 Q3 2018
(2018 a s previously reported) 2019 2019
Net income attributable to 109 – 117 398 22 – 30 26
shareholders (USD millions)
Earnings per share (US D) 0.0445 – 0.0477 0.1626 0.0089 – 0.0122 0.0108
Net income attributable to 741 – 797 2,542 153 – 209 180
shareholders (RMB millions )
Earnings per share (RMB) 0.3030 – 0.3259 1.0392 0.0624 – 0.0853 0.0734
1
The higher reported net income in the first nine months of 2018 is due to the divestiture of several products in
Europe in connection with t he approval by the EU Commission of t he acquisition of Syngenta by ChemChina
last year, and other related impacts, which in the first nine months of 2018 resulted in the recognition of an
approximately $245 million one-time net income. The proceeds of this divestiture, net of taxes and
transaction expenses, were paid to Syngent a in return for the transfer of a portfolio of products in Europe of
similar nature and economic value, which in turn, resulted in the recording in the reported financials of each
quarter of non-cash amortization expenses with no ec onomic impact, in respect of these written-up assets of
approximately $10 million starting in Q2 2018. Excluding the impact of the products’ divestiture and transfer,
net income in the first nine months of 2018 would have been lower by $227 million, while in the nine-month
period of 2019 net income would have been higher by $27 million.
Excluding also the impact of certain one-time/non-c ash items, including mainly the legacy amortization of the
2011 PPA for the ac quisition of Adama Agricultural Solutions Ltd. by ChemChina, results in the following
adjusted net income:
Adjusted Estimated 9M 9M 2018 Estimated Q3 Q3 2018
2019 2019
Net income attributable to 166 – 173 197 35 – 43 40
shareholders (USD millions)
Earnings per share (US D) 0.0677 – 0.0710 0.0806 0.0142 – 0.0174 0.0164
Net income attributable to 1,130 – 1,186 1,272 243 – 298 273
shareholders (RMB millions )
Earnings per share (RMB) 0.4618 – 0.4846 0.5200 0.0991 – 0.1220 0.1117
Adjusted EBITDA is expected to increas e to bet ween $140 and $148 million (RMB 981 – 1,037 million) in the
third quarter, while in t he nine-mont hs it is expected to be between $505 and $513 million, in line with last
year in US D terms, and to increase in RMB terms to RMB 3, 453 – 3,509 million.
These estimations are preliminary and have not been audited or reviewed by the Company's auditors. These
estimations may change as a result, amongst other factors, of the further processing and analysis of the
financial data that the Company will perform for the preparation of its quarterly financial statements, which
will be releas ed on October 31, 2019.
##
About ADAMA
ADAMA Ltd. is one of the world's leading crop protection companies. We strive to Create Simplicity in
Agriculture – offering farmers effective products and services that simplify their lives and help them grow.
With one of the most comprehensive and diversified port folios of differentiat ed, quality products, more than
7,000-strong team reaches farmers in over 100 countries, providing them with solutions to control weeds,
insects and disease, and improve their yields. For more information, visit us at www.ADAMA.com and follow
us on Twitter at @ADAMAA gri.
Contact
Ben Cohen Zhujun Wang
Global Investor Relations China Investor Relations
email: ir@adama.com email: irchina@adama.com
2
