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ADAMA Reports Fourth Quarter and Full Year 2020 Results

Mar 30 2021

Robust business growth and increased profits in the fourth quarter conclude a resilient performance in a challenging year

Fourth Quarter 2020 Highlights

  • Sales grew 10.2% (+17.0% at Constant Exchange Rates, CER) to an all-time Q4 record-high of $1,141 million, driven by robust volume growth across all regions, and achieved despite an estimated $71 million impact from weaker currencies versus Q4 2019
  • Adjusted EBITDA of $168 million, up 8.4% versus Q4 2019, despite an estimated $59 million negative FX impact
  • Reported net income of $19 million, compared to a loss of $74 million in Q4 2019
  • Adjusted net income up 10.3% to $53 million, despite an estimated $54 million in FX headwinds

Full Year 2020 Highlights

  • Sales up 3.3% to hit an all-time high of $4,128 million (+10.6% in CER terms), despite COVID-19 related challenges; USD sales impacted by an estimated $293 million due to weaker currencies versus 2019
  • Adjusted EBITDA of $628 million (2019: $692 million), reflecting an estimated $224 million in negative FX impact, more than offsetting robust business growth
  • Reported net income up 19.4% to $51 million, compared to $43 million in 2019
  • Adjusted net income of $176 million (2019: $258 million), largely reflecting an estimated negative FX impact of $252 million

2021 Outlook1

  • Supportive global demand for crop protection products driven by current positive crop price outlook
  • USD growth and profitability improvements dependent, amongst others, on stabilized currencies against the US dollar
  • Recent increases in procurement costs of raw materials, intermediates and active ingredients, if sustained for an extended period, may challenge gross margins over the coming quarters
  • The Company actively manages its procurement and supply chain activities in order to mitigate these higher procurement costs, and adjusts its pricing wherever possible to compensate
  • Continued progress on the relocation and upgrade of China production and environmental facilities
    • Expecting to start production at the new site in Jingzhou within the next few months

BEIJING, CHINA and TEL AVIV, ISRAEL, March 30, 2021 – ADAMA Ltd. (the “Company”) (SZSE 000553), today reported its financial results for the fourth quarter and full-year period ended December 31, 2020.

Commenting on the results, Erik Fyrwald, Chairman of ADAMA’s Board of Directors, said, “ADAMA ended 2020 on an extremely strong note, delivering a record fourth quarter, driving growth over the full-year period despite the many challenges seen throughout the year. The Company supplied record amounts of its products to customers, helping farmers to safely feed the world during the global COVID-19 pandemic. ADAMA’s passion and commitment to supporting farmers resonated in dozens of local community initiatives across the globe during the pandemic. Additionally, ADAMA’s commercial and operational collaborations with its partners within the Syngenta Group, as well as its continued investment in innovative solutions for agriculture, provides farmers with the best technology and expertise to increase productivity and sustainably grow healthy and affordable food.”

Ignacio Dominguez, President and CEO of ADAMA, said, “2020 was a uniquely challenging year for all of humanity. We have had to completely change the way we live, work and communicate. In these unusual times, ADAMA has been creative, agile and responsive to the tough market conditions, while focusing on protecting both our people and our business. During the year, the global COVID-19 pandemic caused disruptions to both the commercial and operational sides of our business, including the temporary suspension of our site in Hubei province at the outbreak of the pandemic. In addition, the extreme currency volatility seen during the year was a heavy drag on our profitability. However, despite all these challenges, we were nevertheless able to achieve continued growth, and end the year delivering our strongest fourth quarter ever.”

1 All forward–looking statements attributable to the Company or persons acting on its behalf apply only as of the date of this document, and are expressly qualified in their entirety by the cautionary statements included elsewhere in this document. The forward–looking statements are preliminary and subject to change; the Company undertakes no obligation to update or revise these forward–looking statements to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events.  Inevitably, some assumptions will not materialize, and unanticipated events and circumstances may affect the ultimate financial results.

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