HZPC results back on course in uncertain times

October 10, 2022

Dutch potato breeding company HZPC announces that after a challenging 2020/2021 fiscal year, the company has managed to bring its results back on course.

‘Times remain uncertain. The fact that in 2021/2022 we brought the profit figure back in line with our ambitions makes us cautiously positive about the results for the coming years’, reacts Gerard Backx, CEO of HZPC.

900,000 tonnes of seed potatoes sold

On Thursday 6 October 2022, the Supervisory Board of HZPC Holding B.V. discussed the annual accounts for the 2021/2022 fiscal year and the General Meeting of Shareholders determined the annual accounts. HZPC’s turnover was 350 million euro, compared to 312 million euro the previous year. In 2021/2022, HZPC sold almost 900,000 tonnes of seed potatoes directly or through licensees.

Dividend set at 6 euro per certificate

The 2021/2022 result came in at 7 million euro, compared to 1.4 million euro for 2020/2021. These results do not include the costs of the Connecting Growers programme, which sosts 1.5 million euro this year. The Supervisory Board made 4.7 million euro available for dividend payment. The General Meeting of Shareholders was able to set the dividend at 6 euro per certificate, compared to 1 euro in the previous year.

Reorganisation results in lower cost increases

‘Financial year 2020/2021 was particularly difficult due to the corona crisis and the impact of the Lebanon crisis. HZPC was forced to reorganise, which resulted in lower cost increases from financial year 2021/2022. The improvement in the profit figure is the result of better market conditions that increased sales’, HZPC reports. At the same time, after the start of the war between Russia and Ukraine on 24 February, net sales were close to zero, while usually the company still manages to sell a few percent after February. ‘The war caused increasing uncertainty among ware potato growers, and at the same time, prices of several cereal products rose. This affected HZPC’s results.’

Cautiously positive

Backx indicates HZPC is able to draw lessons from what has happened during the previous years: ‘What we have learnt from the past few years is that HZPC is a tremendously resilient company. The world has become more unpredictable. And yet we manage to hold our own in uncertain times. I am therefore cautiously positive about the coming financial year with more sales and a similar level of profit. We are facing high inflation and energy costs, forcing growers and potato processors to make different choices than we are used to. The war in Ukraine has not yet stopped. Its effect on the potato market is difficult to predict’, the CEO states.

The demand for sufficient food remains: Strong growth foreseen outside of Europe

As there is a lot of uncertainty, one thing is certain according to Backx: the demand for sufficient food remains. ‘We foresee substantial growth in countries outside of Europe, such as India, China, Africa and America. In recent years, we took important steps in the development of new varieties and invested in market development. This will begin to bear fruit in the coming year. I have full confidence in that’, he concludes.

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