AGRANA Beteiligungs-Aktiengesellschaft (AGR) Earnings Call Transcript & Summary

Ladies and gentlemen, thank you for standing by. I'm Stuart, your Chorus Call operator. Welcome, and thank you for joining the AGRANA Results for the Full Year 2021-'22 Conference Call. [Operator Instructions] I would now like to turn the conference over to Hannes Haider, responsible for Investor Relations. Please go ahead.

Good morning, ladies and gentlemen, and welcome to our conference call presenting our annual results '21/'22. You already got some insights in our figures when we published 2 ad hoc announcements on the 23rd of March and on the 25th of April. Today, we will provide you with further details on all segments and also on the audited financial statements. With us today are 3 out of 4 members of the Management Board, Markus Mühleisen, CEO of the group, will start the presentation with an overview on the highlights and will comment on the market environment. Our CTO, Norbert Harringer, will afterwards present to you what is going on in the group regarding raw materials and production. We will also provide you with an investment overview and CapEx outlook. Finally, our CFO, Stephan Büttner, will report on the financials in detail, and he will conclude with a financial outlook for the ongoing '22/'23 financial year. As announced in our invitation, the presentation is available in reference to our call. You can find this presentation in the IR section of our website. The presentation will take about 35 minutes. And afterwards, the management Board will be glad to answer your questions. And now I may pass over to our CEO, Markus, who will start with the presentation.

Thank you, Hannes, and good morning to everyone, and welcome to this call. Normally, this would be a time when we would talk about our accomplishments of the last year. We would talk about the fact that we had a good year. We would talk about the fact that we had good operating results and that, actually, we're off to a good start in the new fiscal year. And actually, all these things are true. But these are not normal times. There's, as you know, a war going on in Ukraine, and it is impacting AGRANA in a very significant way. And for us, it's not just about numbers, it's not just about pictures you see on TV, it's not just about headlines you read in a newspaper, but for us, it's also about our employees and their families on the ground in the Ukraine. We have approximately 800 employees in sort of Central Ukraine. And 5 days before our fiscal year-end, our world changed,. the war exploded when Russian forces invaded Ukraine, a war that's causing nothing but suffering and destruction and is forcing millions of people to flee. So our thoughts are with the people of Ukraine. Our thoughts are with our employees and their families. And just as a reminder, and you'll see this on Slide 3 of the presentation, we have a business in Ukraine since 1997. It's 3 different sites, more or less located in sort of the Vinnytsia area, which is about 300 kilometers southwest of Kyiv. We manufacture of fruit preparations there as well as fruits juice concentrates. But we also operate an agricultural production unit. And so this is our operation in Ukraine. It's very focused on selling products in the Ukraine. And I can tell you that after sort of initially when we had to stop production, we've been able to reopen production with our employees. It's not running at full capacity, but increasingly, we were able to ramp up production to satisfy local customers. And as you would imagine, we're doing everything to ensure employee safety as well as supporting them through this difficult time. As you know, we also have operations in Russia. And on Slide 4, though you have some facts there. We're represented in Russia through our Fruit segment. We operate a fruit preparations plant about 100 kilometers south of Moscow with 300 people. And products that we produce there are sold in Russia and in other CIS states. One of the questions that we have been asking ourselves a lot, business question, should we pull out of Russia? And here, I mean, let me first be very, very clear that we absolutely condemn the war. We -- and we do not want, in any way or shape or form, support the Putin government. On the other hand, we have a critical role to play in the food chain. We are a supplier of basic essential foodstuffs. And we have very close dialogue with our customers, which, in Russia, are primarily large international players. And together, we decided that our role is to support the general population. Again, all products that we, together, produce there, they are not luxury items. They're not lifestyle items. They're technical goods. They're no dual used goods. They're essential foodstuffs. And in also consideration of the appropriate views by the UN as well as the various NGOs and European bodies, the service and provision of essential foodstuffs is something which should continue. And so that's why we're still there. We're continuously reevaluating the situation. I can tell you, it's getting increasingly difficult from an operational point of view in terms of getting spare parts into Russia and other ingredients that we need is something that -- there could be a point in the future when we will no longer be able to operate there. We are obviously also constantly evaluating the various sanctions. We fully support them. In addition to the sanctions, we've also announced that we're not making any investments there. We're not expanding the business. And we will continue to, I suppose, both reevaluate our position, at the same time work through different scenarios if the situation would change. So that's just, maybe at the beginning, a few words on Ukraine and Russia. And then coming to the results for '21/'22, obviously, Stephan Büttner will take you through the numbers in a moment in a lot of detail, and you already probably have all the numbers in front of you. Let me just say that it's been a challenging year for sure. And when you look at the numbers, you have to always take into account the highly volatile environment, the fact that as a processor of a lot of raw materials and also as a very energy-intensive company, that raw material costs and energy costs affect us significantly. We've managed through that. We've also managed through, quite well, the corona challenges. And so we actually feel -- from an operational point of view, we actually feel quite good. We see strong operating results. And when you turn to the next page, you can also see it in, for example, our operating profits or our EBITDA, which are quite strong. But of course, due to the war in Ukraine, we had to take significant write-downs and that's been reflected as special items then impacting our EBIT. And so that is the year for us. We'll also talk a little bit about some of the tailwinds we've had. We throughout the year, we've had the benefit of some good ethanol prices which is particularly helping our Starch segment. That is something which we've had some tailwind. Norbert Harringer will later on tell you a little bit about our different processing campaigns. We've had good processing campaigns for some of our key raw materials, in particular, sugar beets, potatoes, but also apples. That's also helped. But again, from an operating point of view, we feel good about the results when you look at them. EBIT, that's kind of where you see the impact of the Ukraine war on our numbers. Just in terms of key figures, and again, Stephan Büttner will talk about that in more detail in a moment. We proposed a dividend of EUR 0.75 per share, which is a bit below last year, reflecting the impact of the Ukraine war. Now today, we won't have the time to talk a lot about strategy going forward, but let me just give you sort of a bit of a heads-up, if you will, on kind of which -- how we're thinking about it. And one of the key things that we think will provide tremendous growth opportunities for AGRANA is the fact that we are at the intersection of 3 of the biggest issues and trends of our times, and that is not only feeding a growing world population, but also managing the transformation in agriculture, but doing it in a sustainable way and dealing with climate change, and we see tremendous growth opportunities there. And so we have been in the process on working on our strategic agenda. Now let me also tell you that, of course, due to the situation in the -- dealing with the various crises, we have been so very much focused on crisis management. We have been very focused on driving operational results, so that's been our top focus. But at the same time, we've also looked beyond. And we will talk to you a little bit more about that in the weeks and months to come. Now before turning it over to Norbert, let me just give you a quick highlight on some of the key market trends and market topics that we see. And of course, on Page 10, you see the ethanol price, and I already mentioned that, it is a -- we had a lot of tailwind from ethanol, and you can see that. And it is something which we have now seen it continue a bit through the first few months now of the new fiscal year. And Stephan Büttner will talk a little bit about the importance of ethanol when you -- when we then get to detail the results. On -- that's helped to offset some of the costs that we've seen, in particular, on the electricity side. And you see that on Page 11, just how these numbers have exploded. I'm pretty sure you're familiar with that. And then the other thing that I want to mention, which is making us a bit more confident also about our Sugar business is the increases we've seen in sugar prices, which you see on Slide 12. And so with that, let me turn it over to Norbert.

Thank you, Markus. Ladies and gentlemen, also from my side, a very warm welcome to our today's conference call. Let me start now with the situation on raw materials. In 2021/'22 financial year, AGRANA Fruit, Starch and Sugar segment processed a worldwide total of approximately 9.8 million tonnes of agricultural raw materials. To see it in the deeper detail, this was 5.7 million tonnes of sugar beet; 220,000 tons of raw sugar to be refined to white sugar; 2.7 million tons of grain, mostly wheat and corn; and about 300,000 tonnes of potatoes; and 900,000 tonnes of fruits. Starting with the fruit preparations, about 345,000 tonnes of raw materials were purchased for the fruit preparations activities. Volatile market setting for commodities and the global trend in freight costs drove an average rise of about 11% year-on-year in raw material costs for fruit and ingredients. Price increases were incurred mainly for berries, that means raspberry, blackberry and blueberry, for peach tropical fruits and stabilizers. On the energy cost side, there were significant increases due to the rate hikes for electricity and gas in the second half of '21/'22 especially in Europe. In order to both secure and required quantities of supply and counteract the price increases, the focus of efforts in the past months was on making procurement more flexible, as well the collaboration with strategic suppliers was intensified. Coming to fruit juice concentrates, in the fruit juice concentrates business, the '21 apple harvest was characterized by good raw material availability in Poland and in Hungary, the relevant main growing regions. What is more, AGRANA was able to process greater volumes than in the prior year, thanks to high availability of red berries, an industry term that includes the strawberries, the raspberries, the black and the white currant, sour cherries, chokeberries and elderberries. All fruit juice concentrate plants recorded good capacity utilization. Let me now come to corn and wheat, in '21/'22, AGRANA Starch processed approximately 8% more corn at the Austrian sites in Aschach and in Pischelsdorf than in the year before. The share of specialty corn, this is notably waxy corn and organic corn, was about 22%. Wheat milling volume at the Pischelsdorf facility for the production of wheat starch, vital gluten and bioethanol, was raised by around 7% in '21/'22 compared to the prior year. AGRANA also secured ethanol wheat and ethanol triticale, 11% of the total processed volume in advance, fruit delivery contracts, visits growers. As in the prior year, contracts for growing in ethanol grains were offered for the '22 crop. In the 2 Austrian locations, a total of about 1.6 million tonnes of corn and other cereals were processed in the past business year. As the HUNGRANA facility in Hungary, the total amount of corn processed in '21/'22 was in line with the prior year level. In the Romanian plant, about 15% less yellow corn was processed due to an increase in the proportion of specialty corn varieties used. Coming to potatoes. In the '21/'22 campaigns, the potato starch factory in Gmünd in Austria, processed at about 274,000 tonnes of starch potatoes. The processing of food potatoes for the production of long life potato products was in line with the prior year volume. Now some general comments on the raw material market situation. Ladies and gentlemen, grain future prices were marked by strong volatility throughout '21 and '22. From mid-August '21 until the end of the financial year, prices rose continually, especially for wheat. This price advance resulted, both from strong demand and weaker harvest due to weather extremes in key production areas. The geopolitical situation in Eastern Europe, then drove prices up explosively at the end of the financial year. At the balance sheet date of the 28th of February '22, on the Euronext [ LIFFE ] commodity derivatives exchange in Paris, wheat quoted at EUR 323 per tonne and corn was at EUR 311 per tonne. The year earlier, it was EUR 245 per tonne for wheat and EUR 226 per tonne for corn. Now some comments to the Sugar segment. The area planted to sugar beet by the approximately 5,800 AGRANA contract farmers. In '21/'22, sugar marketing here was about 86,000 hectares as in the prior year. Favorable vegetation conditions, sufficient rainfall and a higher-than-average number of sunshine hours, especially in September and in October, ultimately led to an above-average sugar content of 17.2%. Around 5.7 million tonnes of sugar beets were harvested from a total area of about 85,700 hectares, corresponding to an average yield of 67 tonnes per hectare. AGRANA's 7 beet sugar factories processed a combined daily average of slightly more than 49,700 tonnes of beets during the campaign, thanks to the high beet quality in a campaign, averaging 115 days in length. The factories produced a total of 850,000 tonnes of conventional sugar. Additionally, at a plant in Tulln in Austria, about 15,600 tonnes of organic sugar were produced in a 10-day separate organic campaign. As a result of the volume of beets processed, the average capacity utilization of the sugar factories was 95%. Now some comments on our focus on ESG, ladies and gentlemen. In '21/'22, the first assessment of AGRANA's corporate carbon footprint laid the foundation for the further development of our group's climate strategy. In line with the requirement of the science-based target initiatives and in addition to the stage plan already developed, AGRANA in 2022/'23 will also develop reduction measures for emissions in the upstream and in the downstream value chain, which, in our baseline year '19/'20, accounted for 83% of our corporate footprint. In the upstream supply chain, which means in agricultural production, we want to take a leading and supportive role in the development and implementation of emission reduction measures in the cultivation of agricultural raw materials is part of the coalition of the willing together with other industrial processors of agricultural crops and stakeholders in the supply chain. Yet our holistic, integrated sustainability strategy must cover not only environmental aspects but also governance and social criteria. For example, in the areas of occupational safety and diversity, we are working to define concrete targets that are subsequently also intended to be reflected in AGRANA's remuneration system. Ladies and gentlemen, let me now come to the investment part. In the last business year, AGRANA invested a total of EUR 82.4 million or EUR 10.1 million more than in the prior year. Purchases of property, plant and equipment and intangibles were thus well below operating depreciation and amortization. Capital expenditure in the Fruit segment in the last business year was EUR 37.4 million. The various CapEx projects across all 40 production sites related primarily to new production lines and continual improvements, as well as asset replacement and maintenance investment. The following individuals investments were made, among others, a new filling plant and an upgrading and capacity expansion of the existing cooling systems in Mitry-Mory in France, and the new construction of an application laboratory in Dachang in China. The Starch segment invested at about EUR 24.3 million during the last financial year. The following projects were carried out, among others, measures to increase the specialty corn processing in Aschach in Austria, and the expansion of the company wastewater treatment plant in our potato starch factory in Gmünd. In the Sugar segment, AGRANA had capital expenditures of EUR 20.7 million in the last financial year, primarily for investments in energy efficiency and product quality. To name 2 examples, the energy supply of the CLS Slovakia site was converted to natural gas and the distributed control system in Tulln, Austria was also expanded. Looking back the last 12 years, we see the continuation of implementation phase after completion of major projects and capacity expansion in the recent years. Ladies and gentlemen, in the new business year '22/'23, the total investment across the 3 business segments at approximately EUR 115 million is expected to exceed the '21/'22 level, much to be below this year's budgeted depreciation of about EUR 120 million. Let me now hand over to Stephan Büttner for his overview about the financials. Stephan, please go.

Yes. Thank you, Norbert. Dear ladies and gentlemen, so let me now give you some comments on the consolidated financial statements. We'll start with an overview on the exceptional items, which heavily impacted our yearly results. So as you can see, nearly EUR 70 million write-downs on exceptional items we had in the last business year, so mainly in the Fruit segment. So fruit preparations business and juice concentrate business were heavily impacted. And most of these write-downs were related to the Ukraine war. So the biggest impact came from the goodwill impairment in -- with a value of EUR 55.3 million, but we also had write-offs in receivables, inventories and other, let's say, current assets. The goodwill impairment, especially so as we saw on the 24th of February, the start of the Ukraine war. And this, of course, was affecting our subsidiaries in Ukraine and Russia. And it was a triggering event, so of course, we had to undertake a goodwill impairment take for the cash generated in unit fruit at our closure of our financial statements on the 28th of February 2022. So there, we -- let's say, we developed 4 future possible scenarios for the business -- for the future business in these 2 countries, building on the basic assumptions presented above on the impacts of the Ukraine conflict and weighted the scenario then by their expected profitability of occurrence. We also wanted to state that these planning calculations adjusted for the effect of the war in Ukraine represented to the Supervisory Board in the special meeting on the 19th April 2022. Let's come to the revenues by segment, the overview. So we already said -- Norbert already said that we had an increase of 13.9% in revenues in the last business year. So the total revenue amounted to EUR 2.9 billion. So you see the increases in all the segments, 7.2% in the Fruit segment, 22.9% in the Starch segment and 14.6% in the Sugar segment. So in all the segments, we had price increases and these were the major reason -- was the major reason, let's say, for these revenue increases. In Sugar, also, we had around a 6% volume increase and around a 5% price increase. In Starch, the ethanol business was quite important, so amounting to, I would say, around 25% of the total revenue in the Starch segment. And as I already mentioned in the Fruit segment, fruit preparations as well as juice concentrates were sold at higher prices. The EBIT by segment. So you see our total EBIT of EUR 24.7 million. So EUR 71.6 million EBIT in the Starch segment. Here, bioethanol was a major contributor to this result with a percentage of 75%. Sugar, still negative, mainly due to the -- let's say, the small production campaign in 2021 -- no, 2020, sorry. So where we then started with high inventory, let's say, prices on inventories, and therefore, affecting negatively our margins, especially in the first half of the business year. In the second half of the business year, in Sugar, we saw this massive increase in energy prices, which also had a negative impact on our margins. And therefore, we are still negative in the Sugar segment because we were simply not able to pass on all these price increases in time. In the Fruit segment, also negative, minus EUR 15.8 million. But there, we had this major impact of the exceptional items of approximately EUR 70 million. Let's have a look at the consolidated income statement. So again, revenues, EUR 2.9 billion. The EBIT with the EUR 24 million. And also here, again, you see the exceptional items with the minus EUR 69.8 million, so all resulting in a loss for the period of minus EUR 12.2 million and a loss per share of $0.20. The financial -- the net financial items, so quite comparable to the previous year with minus EUR 16.1 million. So we had an improvement in our currency translation differences by approximately EUR 2 million. And also, the net interest expense was lower despite a higher gross debt during the year. The tax rates, of course, here, not really, let's say, comparable with the prior year, mainly due to the goodwill impairment. And therefore, we had a 241.7% tax rate. But it takes away the chart that you can see the lower in the table, and therefore, comparable like-for-like, we had a 30.6% tax rate. The cash flow statement, so the operating cash flow before changes in working capital amounted to EUR 207.2 million. This is an improvement of 4.2% versus the prior year. Negative impact in the changes in working capital, and this is mainly, of course, due to the higher raw material and energy prices, which is reflected there. Net cash from operating activities, therefore, resulted in EUR 53.2 million growth. The consolidated balance sheet. Total assets, EUR 2,643.6 billion. So especially also here, we can see the increase in the current assets, EUR 1.5 billion compared to EUR 1.24 billion in the previous year. This is an increase of 21.6%, again, also here driven by higher raw material prices in the energy cost. The equity with EUR 1.28 billion, still quite high. So the equity ratio amounting to 48.5%, still very solid. Net debt, EUR 532 million. This is an increase of 20%, also driven by the higher working capital, resulting in a gearing of 41.5%. Dividend was already covered by Markus. So here, our proposal is EUR 0.75 per share. So this is also a sign of our continuous dividend payout, let's say, policy. Also, we took into consideration our operating result, which was comparable to the previous year. And also, let's say, the good start we had into the business year '22/'23. Yes. On the next page, you can see the historic development of our dividend earnings per share and the dividend yield with a 4.5% for the last business year. Let's come finally to the outlook for '22/'23. So we expect, on EBIT level, a very significant improvement versus the EUR 24.7 million we had in the last business year. But we also want to state that the war in Ukraine, of course, leads to a very high volatility in all the target markets of AGRANA, and we also expect further price increases in the area of procurement. The forecast, of course, '22/'23, is always based on the assumption that the war in Ukraine will remain temporary and regionally limited, also that there will be a physical supply of energy and raw materials. And yes, of course, let's say that our target markets and procurement market, partially -- at least partially returned to normal within the '22/'23 financial year. When we look at the segments. So Fruit segment, there, we expect the, yes, let's say, a moderate increase in revenues and a very significant improvement on EBIT level, of course, due to the high or significant exceptional items we had in the previous year. In Starch, a significant increase in revenue and, let's say, a moderate decrease on EBIT level, mainly due to the higher raw material prices and energy prices. And in Sugar, we expect a significant improvement on revenue and also EBIT. So now let me hand over to Hannes for the financial calendar. Thank you.

Thank you, gentlemen, so far. Before we go on with the Q&A session, I just wanted to remind you that our Integrated Annual Report was published today in the morning. In the -- we would like to invite you to visit also our online report on our website, reports.agrana.com. Having a quick look at our financial calendar, I just wanted to highlight that our Annual General Meeting for the financial year '21/'22 will take place in presence on the 8th of July. Before we go on with the Q&A session, I just would like to draw your attention to Slide #41. We also published an outlook for the first quarter '22/'23, when we published the talk announcement on the 25th of April. And here, we are estimating an EBIT for the first 3 months, '22/'23, which is very significantly above the value of last year, EUR 20.9 million. We will now go on with the Q&A session.

[Operator Instructions] First question comes from the line of Vladimira Urbankova from Erste Bank.

I would have a few questions. I would like to start with Ukraine and Russia operations update. I'm just wondering, given the situation in Ukraine, if you have seen any actual destruction/damages to your facilities, if there is any potential for more write-offs. On the other hand, what is your expectation for sales? Do you expect still some sales to continue for the rest of the year? And in Russia, do you see any difficulties with -- apart from the spare parts with maybe some payments? Do the payments flow regularly? What is your expectation for sales and profitability compared to '21/'22? And then the question would be regarding your guidance. You said that, of course, very significant growth from the reported level. But could you maybe refine the guidance? What would be your versus the adjusted level before one-offs and, as you mentioned, this EUR 86.3 million achieved in '21/'22? The last but not least, energy prices, if you could give us an integrated update on your hedging for energy costs? And in case of any disruptions in Russian gas supplies, which segment would maybe be affected? Or do you expect that the food industry would get some preferential treatment and therefore, you wouldn't suffer at all? So do simply give us any information here.

All right. Well, thank you. First of all, thank you, Vladimira, a host of questions. I'll try to answer 1 or 2, and I'll pass it on to Stephan for more details. So your first question was, has there been any destruction of facilities in the Ukraine and the answer is fortunately no. So our facilities are located roughly 200, 300 kilometers southwest of Kyiv. The reports are that while there have been missile strikes in the area, the local airport has been damaged. There's also been damages to the television tower and to other sort of military facilities in the area. There has been no actual fighting in that area. And so far, so far, there's been no damage to our production facilities. You then had a question on potential write-offs, and I'll let Stephan answer that. But then you also had a question about sales in the Ukraine and, here, I can say that sales are slowly increasing after initially where we had to shut down production and cease production. We have now resumed production in a safe way to limit the exposure to -- or risk to our employees. We have a maximum of 50, 60 employees in each shift at the site. We operate, depending on the day, at about between 1/3 and 2/3 of capacity. The challenges on logistics, what we're seeing is our customers, depending on whether their production sites are impacted, actually have pretty robust demand. So as an example, one of our customers in Ukraine is Dannon. They have 2 production sites, 1 is shut down because it's in the eastern part of the Ukraine. So that's no longer operational. But they're seeing strong demand of their second production site, which fully operating. And so we see that with many of our customers. But Stephan can also maybe give you a couple of more details there. In terms of energy, your last question, in particular, disruption of supply or how we're preparing for that, that actually is very high on our agenda. Part of our crisis management, we've established several teams to look into that. We -- especially our production facilities here in Austria are quite exposed to a disruption of gas supply. We have a high -- in other words, we have a high dependency on gas, especially in our sugar and storage factories. As a result of that, we have put sort of emergency plans in place to secure heating oil as an alternative energy source, and Norbert can comment on the plans there. So we are taking measures to protect ourselves. We've made -- we're making investments in order to protect ourselves, and we're also evaluating the energy supply at all of our facilities across Eastern Europe, but the situation is quite different from country to country and plant to plant. And again, Norbert can give you a bit more color there as to what kind of measures we're taking. So we are taking all the measures we can to ensure continuity of production. But I will tell you that some of these measures, because they're technical in nature, because investment installations have to be made, if gas supply were disrupted tomorrow, we certainly would have a problem, okay? We feel confident that we can ensure that our campaigns in the fall can run well, so that's the time line that we're working against. But if there was disruption before that, then we would have a problem, okay? So now let me hand it over to Stephan for some of the other questions you had.

Yes. This is -- we're going to cover -- sorry. So coming back one more time to sales expectations. So our expectation for Russia is that we -- so let's say our best guess is that we -- that our revenue in the business year '22/'23 will amount to approximately 60%, 70% of a normal year, whereas in Ukraine, our expectation is much lower and amounts to around 35% to 40% actually. Now on concerning payments, so actually, we see no problems. So we're delivering products to our customers. The customers are paying in time. But of course, there also, we have certain risk management policies in place. So we try to limit our outstanding receivables so that we will have no extraordinary risks there. Let's move on to your question concerning our guidance. So yes, of course, our guidance with a very significant improvement is related to the EUR 24.7 million EBIT. So when we look at the operating results, therefore, yes, this means so you're talking about EUR 86.5 million. And there, we must say that, currently, we expect more or less, let's say, a stable result for the actual business year. Energy prices. So yes, here we can say that the hedging or that the hedged prices that we have in place, which amount to approximately, I would say, around 40% to 50% of our total needs. And the actual price levels are reflected in our guidance, in our expectation concerning the results. So there, we see currently no major risks versus our guidance when we look at the actual price levels, yes. And when we talk -- want to talk about our measures to limit our risk in terms of energy supply, so I will hand over to Norbert.

Yes. Thank you, Stephan. As Markus already said, we are now on the way to implement alternative ways for the producing of our main energy for our big factories in the Starch and in the Sugar business. This means the Austrian factories in Tulln and Leopoldsdorf, and the Dutch factories in Austria, meaning in Aschach, in Gmünd and Pischelsdorf. We will have the alternative to use oil instead of natural gas. In all the other factories, we are already ready to use alternative fuels like we did it some years ago in Hungária, where we are able to produce gas out of our beet pulp, for example.

We can go on with the question of Baptiste.

Next question is from the line of Baptiste de Leudeville from Kepler Cheuvreux.

I have a question on the Starch division, could you be more precise on the contribution of the ethanol business and, let's say, the other core starch business in terms of revenue contribution and EBIT contribution? I'm not sure you disclosed it, but can you confirm? And also, yes, just can you quantify or say to what extent you managed to pass on price increases to your customers in the Starch business, but also in the Sugar business?

Sorry. Thank you for the questions. Yes, coming back to the bioethanol. So I think I already mentioned that when you look at the results in '21/'22 in Starch with the EUR 71.6 million EBIT, there, the contribution of the bioethanol amounted to 75% in total and the other 25% coming from our starch business activities, let's say, wheat starch, cornstarch, potato starch and the other byproduct, I would say, here mainly the protein. The second question, the price increases forwarded to the customers or passed on in Starch and Sugar, yes, I think the job was done quite well, yes. Of course, in Sugar, we have a delay, yes. So we are here -- [ we have ] yearly prices. Prices are mainly contracted in August, September in the calendar year and then lasting through August, September of the next calendar year. So therefore, of course, when we contracted the volumes on the sales side, we were not -- there were not all the price increases, especially of energy prices reflected in the sales prices. So this will, of course, negatively impact our margins in the first half of the business year '22/'23. But as we are seeing now, still increasing prices, and then we are quite optimistic, let's say, that we will be able to increase the prices, respectively, in the coming Sugar marketing campaign. And in Starch, yes, of course, I mean ethanol, you can always look at the Platts quotation. So their prices are quite stable with a price of around EUR 1,100 per cubic meter. This is a quite profitable, let's say, price level for us at the moment despite the increase in energy and raw material prices. And with the other prices, I would also say that we were quite successful to pass on increasing raw material prices. But of course, there is a certain risk for the second half of our business year. So -- and therefore, we need to be very careful and work hard to also pass on the prices in this period, yes.

I think there are questions from Bernd from RBI.

The next question is from Bernd Maur from RBI Austria.

The fact is I wanted to ask the same question with the colleague from Kepler did regarding pricing. As you -- I think, the guidance, especially for Q1, but also what you stated now on an adjusted level for the full year is good, takes out some fear some might have. And my question, perhaps you can add something, but it's very similar to the question before, is how many parts of your business, you have a rather long-term 1-year contract. You mentioned Sugar, that -- in your answer that you did not actively adjust them or could not or did not want them to adjust to -- with respect to the client relationship. So what -- did you adjust prices during the period in rest -- in these exceptional raw material and energy price increases we all face? Or do you speak to the contract and will only then, with renewing of the contracts, change the pricing? Or did you actively step in and renegotiated, so to say?

Yes. So we have customer-oriented -- very customer-oriented approach here. So in certain business areas, we are looking for price increases, yes, versus the contracts that we have in place. I would say here, especially in Starch, because they are the raw material price impact and also the energy price impact, this is very, very significant, yes. So this is one thing. And on the other hand, in Sugar, I mean these are yearly contracts and, let's say, certain discipline here, sticking to sales contracts in all kind of situations always is very important. So we also will have years where prices, potentially, will go down. We are also depending on, let's say, on a certain discipline that the contract is a contract. And also, therefore -- I mean, yes, we are not really active now in opening, let's say, sales contracts in our Sugar business. The next Sugar marketing campaign is quite close already, yes. So and therefore, we also have consider that we need to then have a good basis for negotiations here and also a very stable customer relationship. But as I already said, yes, we are very confident that we will be able to significantly increase prices also in the next negotiation cycle, yes.

[Operator Instructions] There are no further questions at this time. And I would like to turn back the call to Hannes Haider for closing comments. Please go ahead.

Yes. Finally, I would like to thank all for the participation and for your interest in AGRANA Group. Hoping to talk to you again soon when we are publishing our Q1 results. We are wishing you a nice remaining weekend. Bye.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for joining, and have a pleasant day. Goodbye.