ROYAL HZPC Group sold significantly fewer tons from Europe than planned over the past year but expects to achieve a similar result for the financial year 2023/2024 (July – June) as the previous year.
In its annual report, the company stated that the 2023 crop year produced low yields per hectare of seed potatoes in seed sizes in Europe, especially in the Netherlands owing to a late and wet spring followed by warm and dry months.
Customers had also been buying top-of-seed sizes this year to use as seed potatoes, which partly compensated for the shortage of availability.
“In countries outside the EU, this usually requires government permission. An exception is rarely given, but this year these exceptions were made. Outside Europe, yields are in fact generally higher than average and Royal HZPC Group is growing solidly,” the report states.
However, current CEO, Gerard Backx, said the tonnage grown under license by Royal HZPC Group licensees is growing by 25%, especially in the Americas and Asia.
“We expect the total tonnage that we sell and/or is sold by licensees to increase by 3%, despite the decline in direct sales from Europe of over 10%. This includes additional sales of top of seed sizes,” he said.
He added that the changing ratio of direct sales to tons produced by licensees, combined with increased selling prices, means that turnover remains the same as last year: about €420 million.
The breeding company anticipates a constant gross margin of €71 million and constant normal operating costs. However, it expects higher total costs to result from debts owed by customers in politically unstable regions.
Royal HZPC Group’s net result is estimated between €5 million and €7 million, excluding costs of the Connecting Growers program.
