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FY2021: Solid growth in sales and net profit contributed to shareholders in a volatile and challenging context

Release time:2022-02-17

Safety and Sustainanility

  • 2021 TRIR 0.78: Safety is and remains Adisseo’s priority, zero accident the target.
  • On track towards sustainability journey: Adisseo is ranking among Top 10 ESG Award out of 400+ A share market listed chemical companies

 

FY2021: Solid growth in revenue (+8%) and net profit contributed to shareholders (+9%) vs FY2020, driven by:

  • (+23%) growth in liquid methionine
  • Continued robust double-digit growth in specialties (+12%)
  • Proactive pricing management as well as continuous cost competitiveness enhancement program offsetting rise in raw material and energy costs

 

Key projects

  • One-China Strategy on track
  1. a. +62% growth in specialty business
  2. b. 2nd Nanjing Plant (BANC2 project) well on track with its construction nearly completed with remarkable safety record
  3. c. Research & Innovation Center in Nanjing started operation at the beginning of 2022
  • European Debottlenecking project running at full capacity (+30KT) since start-up in Sept 2021
  • Reorganization of Research & Innovation in France to support future sustainable business development
  • Calysseo: Construction of 1st Commercial FeedKind® plant nearly completed and on track to start sales at the end of 2022
  • Specialty capacity expansion project started leveraging FRAmelco integration

 

FY2022 outlook

  • Volatility and uncertainty keep prevailing. Safety and sustainability remain Adisseo’s top priorities.
  • Facing the challenges from raw material supply and cost increase in addition to on-going supply chain disruptions, Adisseo is engaged in delivering sustainable profitable growth while pursuing long-term value-creating investments and is confident to achieve targets thanks to its demonstrated resilience.
  • In 2022, revenue growth is expected to accelerate. Adisseo is anticipating to offset significant increase of raw material costs by continuous competitiveness enhance program as well as price management.

 

Jean-Marc Dublanc, Vice Chairman and CEO of Adisseo, said: “2021 required agility as we drove through significant headwinds to support customers and manage our supply chain and sharp increase in raw material and energy costs. I am very proud that our team performed extremely well, helping customers return to growth, maintaining the high resilience of our supply chain and achieving sustainable and profitable business growth.

 

Throughout 2021, we took actions to improve our sustainability performance. We invested to upgrade the environment protection facilities to reduce energy and water consumption, improve production efficiency and minimize carbon and greenhouse gas emissions. Amid China’s efforts towards ‘emission peak’ and ‘carbon neutrality’, we endeavor to make our contribution to China’s 30/60 decarbonization goal through innovative products and services and actively promoting the green development of the entire industry.

 

Our strategy of combining organic growth supported by capacity expansion plus strategic acquisition and partnership keeps delivering value and strengthening Adisseo. The joint venture with Calysta will launch the innovative feed protein product Feedkind® in China and in Asia at the end of 2022, with the potential to transform the aqua feed industry. 2nd Nanjing plant, European debottlenecking project, preparation of specialty capacity expansion, FRAmelco integration, reorganization of our R&I in France,...etc. all key projects are well on track and will contribute to maintain solid growth for Adisseo.

 

Although uncertainty remains in 2022 around COVID-19 variants and supply chain disruptions, we endeavor to deliver accelerated growth via value-creating products and services in 2022. Our capability of delivering on promise and our resilience in fighting headwinds have been clearly demonstrated in past years and we will do it again in 2022!”

 

 

Unaudited figures presented to BAC Audit Committee

 (Full year 2021 audited consolidated accounts are expected to be presented to the Board on 30th March)

 

I. Business Review: Revenues & Net Profit Contributed to Shareholders

 

Unit: CNY (100mil)

FY2021

FY2020

YoY variance

Operating revenue

128.7

119.1

+8%

  • Performance Products

90.7

85.2

+6%

  • Specialty Products

31.6

28.2

+12%

  • Other Products

6.3

5.6

+12%

Comparable Gross profit

(for comparison: calculated with 2020 policy)

(in % of operating revenue)

47.5

36.9%

45.2

37.9%

+5%

-1ppt

  • Performance Products

29.9

29.4

+2%

  • Specialty Products

15.8

14.1

+12%

  • Other Products

1.8

1.7

+6%

Net profit contributed to the shareholders of the Company

14.7

13.5

+9%

 

Adisseo is engaged towards its long-term sustainability target. Safety is and will remain Adisseo’s priority. 2021 TRIR landed at 0.78. Zero accident remains the target.

 

In the context of on-going COVID-19, Adisseo is always keeping people safe and ensuring business continuity in the best interest of customers.

 

Adisseo is well on track towards its sustainability journey. Adisseo was ranked among Top 10 ESG Award out of 400+ chemical listed companies in A share market.

 

In FY2021, Adisseo achieved robust growth in revenue (+8%, CNY12.87 billion) thanks to +23% growth in liquid methionine and +12% growth in specialties. Global sales network and balanced industrial set-up enabled Adisseo fully capture the business dynamic across the globe. Proactive price management, agile and responsive supply and continuous competitiveness enhancement program allowed to offset partially the dramatic increase of raw material and energy costs, notably in the fourth quarter.

 

Regarding the methionine business, the liquid methionine recorded strong revenue growth driven by robust growth in all regions, especially led by Latin America, Indian Subcontinent and Europe.

 

Both Burgos (Spain) plant and Nanjing plant (BANC)’s have been running with high reliability despite supply and energy challenges.

 

Methionine price is being increasing in most of regions but not yet compensating the increase in all raw material prices.

 

Leadership in methionine will be further strengthened thanks to Adisseo’s continuous capacity expansion projects.

 

The new 180KT liquid methionine plant (BANC2 project) is progressing well on track with 6 million hours without accident. Civil work and over 99% construction work were completed with pre-commissioning phase smoothly started heading for its planned start-up in 2nd half of 2022.

 

In addition, as an illustration of Adisseo sustainability project, a steam recycling project was launched in 2021 to further enhance energy utilization efficiency in Nanjing plant.

 

The debottlenecking of European plant is running at full capacity (+30KT) since its start-up in September 2021.

 

On Vitamins, Vitamin A and E selling price remained firm.

 

In FY2021, specialty business reached double-digit growth in revenue (+12%, CNY3.16 billion) thanks to:

  • Outstanding performance in China (+62%) and Latin America (+16%)
  • Continued high-double-digit growth in ruminant business (+15%) driven by US & China market in 2021.
  • Solid growth in Health by Nutrition driven by FRAmelco integration and a great year for Selisseo in most regions (+31% volume growth)
  • Double-digit growth in palatability business (+11%) and aqua (+13%)
  • Double-digit growth in feed digestibility in last quarter thanks to its further penetration to the market. Continued steady growth expected in 2022 with the launch of the new enzyme product Rovabio Phyplus at the end of October 2021.

 

Adisseo launched a European Specialties Capacity Expansion and Optimization Project to support business growth, optimize industrial set-up and improve customer service. The preparation work has started at the end of 2021.

 

One-China Strategy, initiated in 2020, has been progressing steadily and achieved multiple tangible benefits:

  • Outstanding growth of Specialty business in China (+62%) was achieved led by double-digit growth in aqua, health by nutrition and ruminant businesses.  
  • Specialty capacity expansion project in China entered basic engineering design stage in December 2021 with expected start up in 2023.
  • The new China Research & Innovation Center (Nanjing) started at the beginning of 2022.
  • Adisseo PNE (precise nutrition evaluation) program received Franco Chinese Innovation Award in November 2021.

 

The first commercial FeedKind® Chongqing plant of Calysseo, Adisseo’s joint venture with Calysta, is progressing well with around 90% completion rate and reached about 900,000 safe working hours. Engineering and purchasing are close to completion and the start-up preparation is on track to start the sales at the end of 2022.

 

FY2021 net profit contributed to shareholders (CNY1.47 billion) achieved +9% growth. Growth in gross profit, improvement in FX result and positive impact from 15% buy-back contributed to the growth. Competitiveness enhancement program realized additional recurring savings of around CNY165mil in 2021, allowing to partially offset sharp increase in freight, continuous investment in sales & marketing and accelerated research & innovation.

 

II. Cash-flow and Net Debt

 

Cash position as of 31st December 2021 stood at CNY2.1 billion, a reduction of CNY0.65 billion compared to 31st December 2020.

 

Operating activities continue to generate positive cash-flow. More than that, working capital management is being monitored with high attention in the context of serious challenges on supply and on cash management. Thanks to the solid operational cash conversion capability, Adisseo is able to pursue on-going investment in CAPEX to fuel future growth and to distribute annual dividends in line with its commitment.

 

III. Corporate Governance & Shareholder Structure

 

Adisseo received a recognition of 2021 Annual Outstanding Practice Case of Office of Board of Directors of Public Companies organized by CAPCO (China Association for Public Companies).

 

The conversion of the exchangeable bonds issued by Bluestar started on 21st October 2020 till 2024. As of 31st December 2021, around 22% of total EB was converted with floating reaching 14.2% of Adisseo market capitalization.

 

IV. FY2022 outlook

 

In a context where volatility and uncertainty keep prevailing, safety and sustainability remain Adisseo’s top priorities.

 

Facing the challenges from raw material supply and cost increase in addition to on-going supply chain disruptions, Adisseo is engaged in delivering sustainable profitable growth while pursuing long-term value-creating investments and is confident to achieve target thanks to its high resilience in confronting difficulties and its proved capability in delivering promises.

 

In 2022, revenue growth is expected to accelerate, and it will contribute to offset significant raw material cost increase thanks to:

  • Strong volume growth in methionine
  • On-schedule start-up of new liquid methionine plant in Nanjing and Calysseo FeedKind® Plant in Chongqing
  • Continued robust growth in specialties
  • Seizing market opportunities in vitamin sector
  • Constant proactive margin and cost optimization arising from competitiveness enhancement program
  • Leveraging innovation capabilities and external growth opportunities

 

 

 

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About Adisseo

Adisseo is one of the world's leading experts in feed additives. The group relies on its 8 research centers and its production sites based in Europe, USA and China to design, produce, and market nutritional solutions for sustainable animal feed. With more than 2,532 employees, it serves around 3,900 customers in over 110 different countries through its global distribution network.

Adisseo is one of the main subsidiaries of China National BlueStar, leader in the Chinese chemical industry with nearly 20,000 employees and a turnover of CNY 70 billion in 2021.

Adisseo is listed on the Shanghai Stock Exchange.

Adisseo Corporate websites: www.adisseo.com; www.bluestar-adisseo.com

 

 

ADISSEO press contact

In China: Yun CAI, yun.cai@adisseo.com