Interim report, 3rd quarter 2011

Continued improvements on objectives and strategic focus areas

(Comparative figures for the same period last year are shown in brackets)

The satisfactory improvement on objectives and strategic focus areas continued in Q3, and Auriga is maintaining the outlook for the year. In the first nine months of the year, continued strong growth from new products has resulted in overall growth of 10% when excluding the revenue from glyphosate. The contribution ratio was improved, and capacity costs were reduced. The EBITDA margin increased to 9.2% (7.0%), while the operating profit (EBIT) was improved by DKK 121 million at DKK 274 million. Profit before tax doubled to DKK 94 million despite negative foreign exchange rate adjustments. Improvements were seen in both working capital and debt burden.

• Revenue for the first nine months of the year were up just over 5% at DKK 4,408 million (DKK 4,180 million) corresponding to 7% growth at constant exchange rates (CER). The rise was achieved despite the continued decline in glyphosate sales. Growth is especially driven by the new products, which – together with slight price increases – have improved the contribution ratio even though it has been negatively impacted by high commodity and energy prices and unfavourable foreign exchange rate developments.
  
  
• Capacity costs were – despite increasing activity levels – reduced to DKK 874 million (DKK 896 million) due to the streamlining measures introduced, strict cost control and lower foreign exchange rates.
  
  
• Operating profit before depreciation and amortisation (EBITDA) increased to DKK 404 million (DKK 292 million), corresponding to an EBITDA margin of 9.2% (7.0%). Operating profit (EBIT) was up DKK 121 million at DKK 274 million (DKK 153 million), while profit before tax was doubled at DKK 94 million (DKK 47 million).
  
  
• Cash flow from operating activities developed positively in Q3, but remained negative for the first nine months of the year at DKK -129 million (DKK -73 million). The average working capital relative to revenue was further improved, and the debt burden (NIBD/EBITDA) was reduced to 4.5 (8.1).
  
  
• With an increase to DKK 180 million (DKK 112 million), net financials are not developing satisfactorily. The increase is attributable, in particular, to higher interest expenses in Brazil and India and non-realised foreign exchange rate adjustments in i.a. Brazil.

OUTLOOK 2011

Auriga maintains the previously announced outlook of revenue of approx. DKK 5,800 million, an EBITDA margin of 8-10% and EBIT in the range of DKK 300-400 million in addition to an improved cash flow from operating activities relative to 2010.