Syngenta earnings wither but it's no surprise: CEO
Syngenta, the world's largest agricultural chemicals group by sales, reported full-year earnings below analysts' expectations Wednesday and outlined plans to cut costs.
Full-year sales were $14.7 billion in 2013, up 3 percent from the previous year but below forecasts of $14.824 billion in a Reuters poll of analysts. Net profit for the year was $1.644 billion, also below forecasts of $1.706 in the Reuters poll.
Chief Executive Mike Mack told CNBC Europe's "Squawk Box" on Wednesday that the earnings should not have been a surprise, given that the company warned in October that earnings would be lower than it had expected.
"I don't think it was as big a miss as some of the early headlines that are coming out [make it to be]," Mack said, adding that the company was in line to meet its integrated sales target of 6 percent in 2014.
Earnings before interest, taxes, depreciation and amortization (EBITDA) were 7 percent lower, however, at $2.9 billion. The company said this was due to lower royalty income and non-recurring seed costs.
It proposed a 5 percent dividend increase to 10.00 Swiss francs per share.
Syngenta said it would speed up a savings program following the earnings. Mack said these could be found in the company's research and development unit, production cost environment and customer-facing operations. "A billion dollars [worth of] savings by 2018 will drive up our EBITDA margin."
Mack was unconcerned by the company's exposure to emerging markets -- 20 percent of its sales are in Brazil -- despite the turmoil in emerging economies and currency depreciation on the back of tapering by the U.S. Federal Reserve.
"The emerging markets have been a source of our growth. Fifty-two percent of our sales now are in emerging markets and these have powered our revenues up. We've had exposure all along, we've been here before with Brazil and Argentina," he said.
"We're calling this year for $50 million of currency exposure from emerging markets but if you look past the last five years...this is not new."
Mack said earlier on Wednesday that the company's financial performance in 2013 "did not meet expectations."
"While this was mainly due to non-recurring costs in our seeds business, we are determined to intensify our focus on cost and capital efficiency while maintaining our ambitious growth objectives. Today we are announcing a program to accelerate operational leverage across the organization," he said in the earnings statement.