Greenyard results plunge after Hungarian disaster

Vegetable producer Greenyard has suffered heavy losses in the first half of the financial year: the listeria contagion in Hungary, the drought and a number of impairments are the primary causes of these poor results.

Extraordinary weather

Turnover plunged by 3.6 % to 1.983 billion euros as gross profit without non-recurring items ended at 45.7 million euros, almost 40 % lowerthan the same period last year. “The three main reasons are the weather, pressure on the prices and the recall“, CFO Geert Peeters says. The impact was most strongly felt in the fresh produce division, as a result of the ongoing drought and growing competition.

With a 113.4 million euro loss, Greenyard’s net result is far below expectations: the recall that was necessary after the listeria crisis cost the company 22.6 million euros. In addition, there were some accounting issues: growth delay caused by the listeria contagion led to an impairment of goodwill costing 29.2 million euros, while the sale of Horticulture, a smaller division dealing in potting soil and substrates, caused an impairment of 44.9 million because expected synergies can no longer be realised.

Despite the disappointing results, Greenyard maintains the projection it made in August that the year will ultimately end up profitable. Nevertheless, they did issue a warning that gross company profits would be 25 % lower across the financial year.