BASEL, Switzerland, Feb. 6 /PRNewswire-FirstCall/ -- -- Sales $11.6
billion up 21 percent at constant exchange rates -- Crop Protection
sales up 22 percent(1) at $9.2 billion -- Seeds sales up 16
percent(1) to $2.4 billion -- Earnings per share(2) up 42 percent
to $16.26 -- Earnings per share $14.63 after restructuring and
impairment -- Free cash flow $761 million -- Proposed dividend
increase: up 25 percent to CHF 6.00 Reported Financial Excluding
Restructuring, Highlights Impairment 2008 2007 Actual 2008 2007
Actual CER(1) $m $m % $m $m % % Sales 11624 9240 +26 11624 9240 +26
+21 Net Income(3) 1385 1109 +25 1540 1112 +38 - Earnings per share
$14.63 $11.42 +28 $16.26 $11.45 +42 - Excluding 2007 non-recurring
income $16.26 $11.06 +47 - Mike Mack, Chief Executive Officer,
said: "2008 was an extraordinary year for agriculture in which
acreage expanded and technology adoption accelerated. Growers
worldwide increased usage intensity for crop protection and planted
higher value seeds, resulting in excellent crop yields globally.
Syngenta was able to take full advantage of the favorable market
environment thanks to the breadth of our portfolio and our global
presence. We achieved particularly strong growth in emerging
markets, which now account for over a third of our sales. Growth in
food and feed demand is centered in these countries and underlies
their ongoing drive to realize yield potential. "Sales growth was
broad-based and was accompanied by higher profitability, despite
substantial growth investments which will ensure the further
expansion of our business. In Seeds, we successfully launched our
proprietary triple stack in the USA and demonstrated the broad
scope of our traits and germplasm globally. In Crop Protection, we
gained market share for the fourth consecutive year. New products
launched since 2006 showed dynamic growth and we added major
projects to our strong pipeline. The potential of existing products
was exemplified by AMISTAR(R), with sales now in excess of $1
billion, and by ACTARA(R)/CRUISER(R). We commenced a major capacity
expansion program to enable us to realize this potential. At the
same time we returned over $1 billion to shareholders while
retaining the financial flexibility to make several acquisitions in
strategic areas." (1) Growth at constant exchange rates, see
Appendix A. (2) EPS on a fully-diluted basis, excluding
restructuring and impairment. (3) Net income to shareholders of
Syngenta AG. Financial Performance 2008 Sales up 26 percent Sales
at constant exchange rates (CER) increased by 21 percent, with
growth across all product lines and regions. Volume growth of 15
percent was supplemented by a six percent contribution from price.
Crop Protection sales* rose by 22 percent (CER) and Seeds sales by
16 percent (CER). EBITDA margin 21.5 percent EBITDA increased by 22
percent (CER) to $2.5 billion primarily reflecting the growth in
volume. Price increases and operational efficiency savings more
than offset higher raw material costs and are enabling the company
to continue investing in growth. Currency movements The impact of
currencies on reported sales was positive in the first half of the
year and neutral in the second half reflecting the appreciation of
the dollar towards the end of the year, notably against emerging
market currencies. For the full year, currencies had a positive
impact of $164 million on EBITDA. Earnings per share up 28 percent
Excluding restructuring and impairment, earnings per share rose 42
percent to $16.26. On the same basis and excluding non-recurring
income in 2007, earnings per share rose by 47 percent. The increase
was driven by higher operating income and a lower tax rate. After
charges for restructuring and impairment, earnings per share were
$14.63 (2007: $11.42, including non-recurring income). * Crop
Protection sales include $73 million of inter-segment sales.
Business Highlights Crop Protection: outperformance 2008 was a year
in which greater usage intensity of Crop Protection products
brought increased realization of the benefits they bring. These
benefits go beyond pest control and deliver improved crop yield and
vigor. Syngenta's modern portfolio has the breadth needed to offer
full programs and solutions to growers enabling them to improve
yield and therefore profitability. The value of our products to
growers allowed us to achieve a price increase of six percent in
2008. In Europe, higher crop prices and the elimination of the EU
set-aside requirement resulted in increased acreage in Western
Europe. Strong demand for cereals favored the development of the
fungicide market in particular. Sales of AMISTAR(R), BRAVO(R) and
our leading triazole ALTO(R) all rose by over 30 percent,
illustrating the importance of a broad portfolio in the treatment
of disease, where resistance means that single compounds are often
ineffective. In Eastern Europe growth across all product lines
reflected the ongoing modernization of agriculture and the
strengthening of our market-leading position, a result of our
long-standing presence in the region and of recent investments in
the product range and in marketing. In NAFTA we played a key role
in the development of the US corn fungicide market with our
combination product QUILT(R), while in Seed Care, CRUISER(R)
continued to prove its efficacy on both corn and soybean. We also
benefited from significant volume and price gains in the glyphosate
market, where our TOUCHDOWN(R) range was further differentiated
through the introduction of HALEX(R). Latin America had a record
year despite a deterioration of economic conditions in the second
half. In Asia Pacific, growth was particularly strong in the
emerging markets with a focus on the key crops of rice and
vegetables. Sales growth was strong across the range. For the first
time Fungicides were our largest product line, led by AMISTAR(R)
for which sales reached $1 billion. An exceptional performance in
Non-selective herbicides reflected a buoyant glyphosate market in
which TOUCHDOWN(R) gained market share thanks to the success of the
TOUCHDOWN(R) brand ladder and to the launch of HALEX(R). ACTARA(R)
and CRUISER(R), based on the same active ingredient thiamethoxam,
drove growth in Insecticides and Seed Care respectively. Growth in
Professional Products was led by growing media sales from Fafard.
Seed Care sales were driven by a technology shift and market share
gain: we market our seed treatments to major seed companies and in
2008 announced a multi-year agreement to sell CRUISER(R) to Pioneer
Hi-Bred for use on their corn seed products in NAFTA. We are
expanding the scope of our technology with the planned launch of
AVICTA(R) on corn and the announcement of Plene(TM), a new
technology which will dramatically improve the cost efficiency of
sugar cane planting in Brazil. In December we announced an R&D
agreement with Dow AgroSciences to evaluate Dow compounds for
incorporation into our Seed Care portfolio. New products: Sales of
new products (defined as those launched since 2006) totaled $263
million. The largest contribution came from the cereal herbicide
AXIAL(R), which was well positioned to gain share in a buoyant
cereals market. The fungicide REVUS(R), used on vegetables, vines
and potatoes, expanded rapidly with registrations in over 50
countries planned. The insecticide DURIVO(R) was launched on rice
in Indonesia and was an immediate success. In Seed Care AVICTA(R)
sales were lower owing to reduced US cotton acres. R&D
pipeline: The combined peak sales potential of our Crop Protection
pipeline is in excess of $2 billion. We have several products in
late development including 520, a broad spectrum cereal fungicide,
which made significant advances during the year and is now
scheduled for launch in 2010; 524, a seed treatment fungicide; and
449, a new herbicide for corn and sugar cane. We signed a strategic
alliance with Rohm & Haas to develop and commercialize
INVINSA(TM) technology as a unique product for crop stress
protection in field crops. We will also prepare regulatory studies
jointly with DuPont for DuPont's Cyazypyr(TM), a new broad spectrum
insecticide with significant potential for combination with our own
products. EBITDA increased by 28 percent (CER) to $2.5 billion with
a record margin of 26.6 percent (2007: 25.0 percent). Substantial
volume growth and price increases more than offset a $68 million
impact from higher raw material costs, while allowing significant
investment in growth opportunities. Seeds: broad-based growth In
2008 our diversified Seeds portfolio was well placed to respond to
the global shifts in crop acreages. We also benefited from the
scale of our presence in emerging markets, where the trend in favor
of high value seeds is a key milestone in the modernization of
farming practice. Corn & Soybean: In the USA, where GM
penetration continued to expand, our proprietary triple stack seed
AGRISURE(R) 3000 GT was successfully launched in limited
quantities. Availability will increase rapidly and further advances
in portfolio quality will be achieved through combination of the
traits with elite germplasm. In soybean, where Syngenta already has
a full traited offer, quality of germplasm plays a key
differentiating role and allowed us again to gain market share.
With lower US corn acres, growers outside the USA responded by
increasing corn plantings. This gave rise to new opportunities with
a broadening of our hybrid maturity profile in Europe and the
expansion of our traited offer in Latin America. In Brazil,
approval of our Bt11 trait was confirmed in May, enabling us to
introduce the trait for the 2008/2009 season. Approval for GA21
herbicide tolerance later in the year opens up future potential for
double-stack products. Brazilian soybean sales progressed rapidly
with excellent acceptance of the early maturity V-Max variety. In
Argentina, the acquisition of SPS Argentina SA will complement our
existing strong corn position while giving us a platform for the
launch of soybean technology. Diverse Field Crops: Sunflower sales
expanded rapidly, notably in Eastern Europe, where growing demand
for healthy eating oils has fuelled acreage expansion and a move
away from open pollination towards higher quality hybrids. We
strengthened our position in oilseed rape and doubled our market
share in US sugar beet following the launch of our
glyphosate-tolerant variety. Vegetables & Flowers: In
Vegetables we successfully integrated Zeraim Gedera which
strengthened our focus on high value crops and our presence in the
Mediterranean region. Flowers growth reflected the acquisition of
Fischer which has reinforced our world leading position. In the
fourth quarter we completed two more acquisitions which further
expand our genetic pool: industry-leading breeder and producer
Goldsmith Seeds Inc., and the chrysanthemum and aster business of
US flowers producer Yoder Brothers Inc. R&D pipeline: We have a
promising pipeline of traits in both corn and soybean, which
focuses on delivering improved solutions for growers throughout the
Americas. These include drought tolerance, nitrogen efficiency and
corn amylase, an enzyme which improves the productivity of ethanol
plants. In December we received EPA approval for the first of our
corn pipeline traits, AGRISURE VIPTERA(TM) (VIP broad lep). The
value of our technology is increasingly recognized externally as
demonstrated by the licensing of dicamba-enabling technology to
Monsanto and of VIP broad lep to Pioneer Hi-Bred. Among our many
Vegetable projects are complex native traits to protect sweet
peppers from sucking insects, developed through a joint approach by
entomologists in India and Switzerland. EBITDA of $135 million
(2007: $98 million) was driven by volume growth and an improvement
in gross margin, partly offset by increased investment in R&D
and marketing. The EBITDA margin improved to 5.5 percent and is on
track to reach the target of 15 percent in 2011, driven by the
development of a fully traited offer in corn and growth in high
margin businesses such as Vegetables. Net financial expense Net
financial expense increased to $169 million (2007: $42 million) due
to a negative impact from currencies, which in 2007 were favorable.
The company's ongoing financial strength is demonstrated by
interest cover (EBITDA/net interest) of 16.7x. Taxation The
favorable resolution of several statutory tax audits resulted in an
underlying tax rate for the period of 19 percent (2007: 24
percent). A tax rate in the low to mid-twenties is expected over
the medium term. Cash flow Free cash flow was $761 million. Average
trade working capital as a percentage of sales was 37 percent
(2007: 39 percent) primarily reflecting good receivables
collection. Fixed capital expenditure of $444 million (2007: $317
million) was higher as investment in both Seeds and Crop Protection
was increased. Capacity expansion In July, Syngenta announced a
phased capacity expansion program with an expected total investment
of $600 million over the three years 2008-2010. The main products
concerned are the fungicide azoxystrobin (AMISTAR(R)) and the
insecticide thiamethoxam (ACTARA/CRUISER(R)). Expenditure under the
program in 2008 was $40 million. Cash return to shareholders A
dividend of CHF 4.80 per share (2007: CHF 3.80) was paid in April
representing a total payout of $450 million. In addition Syngenta
repurchased 2.3 million shares, bringing the total cash return for
the year to $1042 million. The cumulative cash return over the last
five years is $3.7 billion. A significant increase in the dividend
for 2008 to CHF 6.00 per share will be submitted for shareholder
approval at the AGM on 21 April 2009. Outlook Mike Mack, Chief
Executive Officer, said: "In 2008, buoyant agricultural markets
demonstrated the central role of technology in an ongoing drive to
raise yields. Syngenta capitalized on the favorable environment,
reinforcing our global leadership position. In 2009, adverse
currency effects and the need for tight risk management may limit
growth in the emerging markets. Early signs for the northern
hemisphere season are encouraging and we are well placed again to
outperform the overall market, enabling us to continue targeting
growth in earnings per share in 2009 despite economic uncertainty.
We remain confident in the strong fundamentals for agriculture and
the outlook for our business, as demonstrated by the continuation
of growth investments, our capacity expansion program and the
significant dividend increase announced today." Crop Protection For
a definition of constant exchange rates, see Appendix A. Full Year
Growth 4th Quarter Growth Product line 2008 2007 Actual CER 2008
2007 Actual CER $m $m % % $m $m % % Selective Herbicides 2412 2019
+19 +14 349 310 +13 +20 Non-Selective Herbicides 1329 902 +47 +43
228 191 +20 +23 Fungicides 2620 2004 +31 +25 517 449 +15 +20
Insecticides 1423 1205 +18 +15 334 269 +24 +27 Seed Care 830 604
+37 +33 208 152 +37 +42 Professional Products 527 475 +11 + 8 140
127 +10 +11 Others 90 76 +20 +19 26 48 -45 -44 Total 9231 7285 +27
+22 1802 1546 +17 +21 Selective Herbicides: major brands AXIAL(R),
CALLISTO(R) family, DUAL(R)/BICEP(R) MAGNUM, FUSILADE(R)MAX and
TOPIK(R) AXIAL(R), our new cereal herbicide, grew rapidly in an
expanding cereals market with launches in key European countries
and further expansion in NAFTA and Western Europe. The CALLISTO(R)
family of products saw double digit growth with a continuation of
its successful roll-out outside the USA. Soybean herbicides staged
a resurgence in sales as a result of acreage growth in Latin
America and glyphosate-resistance issues in the USA. Non-selective
Herbicides: major brands GRAMOXONE(R) and TOUCHDOWN(R) TOUCHDOWN(R)
sales increased significantly driven by growth in key markets
including the USA, Brazil, Argentina and Canada where
glyphosate-tolerant acres continued to expand. Sales also benefited
from a favorable pricing environment which offset higher sourcing
costs. GRAMOXONE(R) continued to prove its effectiveness in rapid
weed burn-down and also benefited from the tightness of glyphosate
supply. Fungicides: major brands ALTO(R), AMISTAR(R), BRAVO(R),
REVUS(R), RIDOMIL GOLD(R), SCORE(R), TILT(R) and UNIX(R) In 2008,
we strengthened our world leading position in fungicides in a
market characterized by increased usage intensity and growers'
focus on plant performance. Growth in AMISTAR(R) reflected the
success of a variety of combination products used across crops.
AMISTAR(R) is now sold on 120 crops in 100 countries and has proven
a yield-boosting effect in addition to excellent disease control.
In the USA, fungicide use on corn and wheat grew rapidly, with
QUILT(R) establishing a leadership position in an expanding corn
fungicide market. In Latin America, fungicide growth was broad
based across the region with PRIORI Xtra(R) now the leading product
in Brazil for the prevention and treatment of soybean rust.
Insecticides: major brands ACTARA(R), DURIVO(R), FORCE(R),
KARATE(R), PROCLAIM(R), VERTIMEC(R) ACTARA(R) continued to grow
strongly notably in Latin America. Sales of KARATE(R) showed strong
growth particularly in the USA, where they benefited from a major
outbreak of soybean aphids and from new opportunities for mixtures
with fungicides. The successful launch of DURIVO(R) in Indonesia
marks a significant step in the strengthening of our rice
portfolio. Growth of FORCE(R) in Europe due to the spread of corn
rootworm more than offset a reduction of sales in NAFTA. Seed Care:
major brands AVICTA(R), CRUISER(R), DIVIDEND(R), MAXIM(R) In Seed
Care, sales increased by one third. The global expansion of
CRUISER(R) led to strong growth in all regions as growers
recognized its unique vigor effect in multiple crops. CRUISER(R)
also benefited from higher soybean acres in the USA and a
registration in France. Professional Products: major brands
FAFARD(R), HERITAGE(R), ICON(R) Turf and Ornamentals saw strong
sales of growing media by Fafard, growth of HERITAGE(R) in Asia
Pacific and the introduction of new products in Latin America. Home
Care strengthened its performance in vector control and materials
protection. Full Year Growth 4th Quarter Growth Crop Protection
2008 2007 Actual CER 2008 2007 Actual CER by region $m $m % % $m $m
% % Europe, Africa, Mid. East 3214 2545 +26 +16 401 423 - 5 +5
NAFTA 2693 2238 +20 +18 338 303 +11 +14 Latin America 2037 1423 +43
+43 824 561 +47 +47 Asia Pacific 1287 1079 +19 +17 239 259 - 8 -
Total 9231 7285 +27 +22 1802 1546 +17 +21 Europe, Africa and the
Middle East: Growers in both Western and Eastern Europe
significantly increased their use of technology in order to raise
yields with strong commodity prices in the first half of 2008
driving cereal and corn acreage. Rapid growth in Eastern Europe --
notably in Russia, Ukraine and Kazakhstan -- reflected ongoing
expansion of the product range and an extension of Syngenta's
leading market position. NAFTA experienced strong sales growth
reflecting the expansion of the fungicide market for corn and
wheat, strong growth in TOUCHDOWN(R) and the continuing expansion
of Seed Care. AXIAL(R) achieved excellent penetration in an
expanded wheat market. In Latin America, strong sales growth was
driven by acreage expansion and the breadth of our product range.
Growers increased their investment in both corn and soybean in
Brazil and Argentina. While economic conditions deteriorated in the
second half, growers continued to invest in crops and sales also
benefited from more favorable pricing. In Asia Pacific, sales
growth came primarily from emerging markets including India, China,
Indonesia and Vietnam with growers investing in key crops including
rice and vegetables. Improved weather conditions and product
launches in Australia resulted in a significant increase in sales.
Seeds For a definition of constant exchange rates, see Appendix A.
Full Year Growth 4th Quarter Growth Product line 2008 2007 Actual
CER 2008 2007 Actual CER $m $m % % $m $m % % Corn & Soybean
1040 893 +16 +13 82 99 -17 -15 Diverse Field Crops 462 351 +32 +23
42 50 -15 - 2 Vegetables & Flowers 940 774 +21 +16 162 168 - 5
+2 Total 2442 2018 +21 +16 286 317 -10 - 4 Corn & Soybean:
major brands AGRISURE(R), GARST(R), GOLDEN HARVEST(R), NK(R) In the
USA, sales of NK(R) soybean benefited from an acreage shift in
favor of soybean and from a further market share gain reflecting
yield outperformance. In corn, our proprietary triple stack product
under the AGRISURE(R) brand was successfully launched and
incorporation of these traits into our elite germplasm is
accelerating. Sales of corn in Europe expanded rapidly, with
increased acreage and a broadening of our portfolio across
maturities. In Latin America, sales increased significantly in
buoyant corn and soybean markets, as customers responded positively
to new combinations of GM technology and top germplasm. Diverse
Field Crops: major brands NK(R) oilseeds, HILLESHOG(R) sugar beet
Diverse Field Crops showed strong growth reflecting our leading
position in sunflower and increased presence in winter oilseed
rape. Eastern European growers in particular are responding to
growing demand for healthy oils and have expanded acreage while
adopting improved varieties. Sugar beet sales increased with the
launch of glyphosate-tolerant varieties in the USA leading to a
substantial gain in market share. Vegetables & Flowers: major
brands, Vegetables DULCINEA(R), ROGERS(R), S&G(R), Zeraim
Gedera; major brands, Flowers Fischer, Goldsmith, S&G(R), Yoder
Strong growth in Vegetables across all regions was supplemented by
the consolidation of Zeraim Gedera. Our strong developed market
presence is being enhanced by a leadership position in the rapidly
growing Latin American market and by increased market penetration
in Asia Pacific. In Flowers the main driver was the full year
consolidation of Fischer acquired in 2007. Full Year Growth 4th
Quarter Growth Seeds by region 2008 2007 Actual CER 2008 2007
Actual CER $m $m % % $m $m % % Europe, Africa, Mid. East 1077 818
+32 +20 93 112 -17 - 7 NAFTA 979 916 + 7 + 6 107 131 -19 -18 Latin
America 216 146 +48 +48 43 34 +24 +25 Asia Pacific 170 138 +23 +24
43 40 + 7 +25 Total 2442 2018 +21 +16 286 317 -10 - 4 Announcements
and Meetings First quarter trading statement 2009 15 April 2009 AGM
21 April 2009 Announcement of the half year results 2009 24 July
2009 Syngenta is one of the world's leading companies with more
than 24,000 employees in over 90 countries dedicated to our
purpose: Bringing plant potential to life. Through world-class
science, global reach and commitment to our customers we help to
increase crop productivity, protect the environment and improve
health and quality of life. For more information about us please go
to http://www.syngenta.com/. Cautionary Statement Regarding
Forward-Looking Statements This document contains forward-looking
statements, which can be identified by terminology such as
'expect', 'would', 'will', 'potential', 'plans', 'prospects',
'estimated', 'aiming', 'on track' and similar expressions. Such
statements may be subject to risks and uncertainties that could
cause the actual results to differ materially from these
statements. We refer you to Syngenta's publicly available filings
with the U.S. Securities and Exchange Commission for information
about these and other risks and uncertainties. Syngenta assumes no
obligation to update forward-looking statements to reflect actual
results, changed assumptions or other factors. This document does
not constitute, or form part of, any offer or invitation to sell or
issue, or any solicitation of any offer, to purchase or subscribe
for any ordinary shares in Syngenta AG, or Syngenta ADSs, nor shall
it form the basis of, or be relied on in connection with, any
contract therefore. Condensed Consolidated Financial Statements The
following condensed consolidated financial statements and notes
thereto, which do not themselves contain all of the information
required by IFRS for a full set of financial statements, are based
on and are consistent with Syngenta's consolidated financial
statements prepared in accordance with International Financial
Reporting Standards (IFRS) as described in Note 1. Condensed
Consolidated Income Statement For the year ended December 31 ($m,
except share and per share amounts) 2008 2007 Sales 11624 9240 Cost
of goods sold (5713) (4669) Gross profit 5911 4571 Marketing and
distribution (2039) (1638) Research and development (969) (830)
General and administrative (849) (604) Restructuring and impairment
(196) (35) Restructuring and impairment, excluding divestment gains
(198) (156) Divestment gains 2 121 Operating income 1858 1464
Income/(loss) from associates and joint ventures 3 (3) Financial
expenses, net (169) (42) Income before taxes 1692 1419 Income tax
expense (307) (308) Net income 1385 1111 Attributable to: -
Minority interests - 2 - Syngenta AG shareholders 1385 1109
Earnings per share - Basic $14.75 $11.56 - Diluted $14.63 $11.42
Weighted average number of shares - Basic 93,916,415 95,973,958 -
Diluted 94,696,762 97,143,368 Condensed Consolidated Balance Sheet
31 December 31 December 2008 2007 $m (reclassified)(1) Assets
Current assets Cash and cash equivalents 803 503 Trade receivables,
net 2311 2386 Other accounts receivable 479 516 Inventories 3456
2647 Financial and other current assets 571 432 Total current
assets 7620 6484 Non-current assets Property, plant and equipment
2188 2138 Intangible assets 3083 2790 Deferred tax assets 514 639
Financial and other non-current assets 1179 1229 Total non-current
assets 6964 6796 Total assets 14584 13280 Liabilities and equity
Current liabilities Trade accounts payable (2240) (1895) Current
financial debts (211) (399) Income taxes payable (322) (512) Other
current liabilities (1291) (849) Provisions (170) (223) Total
current liabilities (4234) (3878) Non-current liabilities
Non-current financial debts and other non-current liabilities
(2869) (1773) Deferred tax liabilities (659) (622) Provisions (921)
(966) Total non-current liabilities (4449) (3361) Total liabilities
(8683) (7239) Shareholders' equity (5884) (6022) Minority interests
(17) (19) Total equity (5901) (6041) Total liabilities and equity
(14584) (13280) (1) Derivative financial assets and liabilities
have been reclassified in accordance with maturity date, see Note 2
on page 15. Certain balance sheet line items have been combined,
both within the current assets section and non-current assets
section, in order to improve the clarity of presentation Condensed
Consolidated Cash Flow Statement For the year ended December 31
($m) 2008 2007 Income before taxes 1692 1419 Reversal of non-cash
items 973 725 Cash (paid)/received in respect of: Interest and
other financial receipts 199 98 Interest and other financial
payments (150) (253) Income taxes (283) (192) Restructuring costs
(140) (214) Contributions to pension plans, excluding restructuring
costs (113) (124) Other provisions (108) (99) Cash flow before
working capital changes 2070 1360 Change in net current assets:
Change in inventories (982) (146) Change in trade and other
accounts receivable and other net current assets (291) (317) Change
in trade and other accounts payable 669 271 Cash flow from
operating activities 1466 1168 Additions to property, plant and
equipment (444) (317) Proceeds from disposals of property, plant
and equipment 29 193 Purchases of intangible assets (118) (53)
Purchases of investments in associates and other financial assets
(70) (43) Proceeds from disposals of intangible and financial
assets 42 26 Net cash flow from (purchase)/disposal of marketable
securities 97 (2) Acquisitions and divestments (144) (172) Cash
flow used for investing activities (608) (368) Increases in third
party interest-bearing debt 986 298 Repayments of third party
interest-bearing debt (378) (116) (Purchase)/sale of treasury
shares and options over own shares (613) (662) Distributions paid
to shareholders (452) (301) Cash flow used for financing activities
(457) (781) Net effect of currency translation on cash and cash
equivalents (101) 39 Net change in cash and cash equivalents 300 58
Cash and cash equivalents at the beginning of the year 503 445 Cash
and cash equivalents at the end of the year 803 503 Condensed
Consolidated Statement of Changes in Shareholders' Equity
Attributable to Syngenta AG shareholders Par value Total of
Additional Treasury Fair Cumulative share- ordinary paid-in shares,
value translation Retained holders' $m shares capital at cost
reserves adjustment Earnings equity January 1, 2007 142 3834 (784)
(6) 334 2146 5666 Profit for the period 1109 1109 Gains/(losses)
recognized directly in equity on: Available- for-sale financial
assets (47) (47) Derivatives designated as hedges (108) (108)
Income taxes on gains/ (losses) recognized directly in equity 7 64
71 Currency translation effects 252 252 Total recognized gains/
(losses) - - - (148) 252 1173 1277 Share based compensation 53 55
108 Distributions to share- holders (131) 7 (47) (128) (299) Share
repurchases (728) (728) Cancellation of treasury shares (5) (121)
629 (7) (496) Other (2) (2) December 31, 2007 6 3720 (830) (154)
532 2748 6022 Profit for the period 1385 1385 Gains/(losses)
recognized directly in equity on: Available- for-sale financial
assets 9 9 Derivatives designated as hedges (34) (34) Income taxes
on gains/ (losses) recognized directly in equity (34) 8 (26)
Currency translation effects (444) (444) Total recognized gains/
(losses) (59) (444) 1393 890 Share based compensation 41 79 120
Distributions to shareholders (450) (450) Share repurchases (683)
(683) Cancellation of treasury shares (143) 727 6 (590) Income
taxes on share based compensation (19) (19) Other 4 4 December 31,
2008 6 3577 (745) (213) 94 3165 5884 Minority Total $m interest
equity January 1, 2007 28 5694 Profit for the period 2 1111
Gains/(losses) recognized directly in equity on: Available-for-sale
financial assets (47) Derivatives designated as hedges (108) Income
taxes on gains/(losses) recognized directly in equity 71 Currency
translation effects 3 255 Total recognized gains/(losses) 5 1282
Share based compensation 108 Distributions to shareholders (2)
(301) Share repurchases (728) Cancellation of treasury shares - -
Other (12) (14) December 31, 2007 19 6041 Profit for the period
1385 Gains/(losses) recognized directly in equity on:
Available-for-sale financial assets 9 Derivatives designated as
hedges (34) Income taxes on gains/(losses) recognized directly in
equity (26) Currency translation effects 1 (443) Total recognized
gains/(losses) 1 891 Share based compensation 120 Distributions to
shareholders (2) (452) Share repurchases (683) Cancellation of
treasury shares - - Income taxes on share based compensation (19)
Other (1) 3 December 31, 2008 17 5901 Segmental Information Crop
Business 2008 ($m) Protection Seeds Development Unallocated Total
Total segment sales 9231 2442 24 - 11697 Less sales to other
segments (73) - - - (73) Third party segment sales 9158 2442 24 -
11624 Cost of goods sold (4352) (1331) (18) (12) (5713) Gross
profit 4806 1111 6 (12) 5911 Marketing and distribution (1474)
(555) (10) - (2039) Research and development (556) (343) (70) -
(969) General and administrative (655) (173) (21) - (849)
Restructuring and impairment (83) (76) (37) - (196) Operating
income/(loss) - continuing operations 2038 (36) (132) (12) 1858
Crop Business 2007 ($m) Protection Seeds Development Unallocated
Total Total segment sales 7285 2018 5 - 9308 Less sales to other
segments (68) - - - (68) Third party segment sales 7217 2018 5 -
9240 Cost of goods sold (3537) (1123) (6) (3) (4669) Gross profit
3680 895 (1) (3) 4571 Marketing and distribution (1167) (465) (6) -
(1638) Research and development (496) (283) (51) - (830) General
and administrative (516) (125) 37 - (604) Restructuring and
impairment 1 (38) 2 - (35) Operating income/(loss) - continuing
operations 1502 (16) (19) (3) 1464 Notes to Condensed Consolidated
Financial Statements Note 1: Basis of Preparation Nature of
operations: Syngenta AG ('Syngenta') is a world leading crop
protection and seeds business engaged in the discovery,
development, manufacture and marketing of a range of agricultural
products designed to improve crop yields and food quality. Basis of
presentation and accounting policies: The condensed consolidated
financial statements for the year ended December 31, 2008 are based
on and are consistent with Syngenta's consolidated financial
statements. Syngenta's consolidated financial statements have been
prepared in accordance with International Financial Reporting
Standards (IFRS) as issued by the International Accounting
Standards Board (IASB) and, except as described in Note 2 below,
with the accounting policies set out in the Syngenta Financial
Report 2007. The consolidated financial statements are presented in
United States dollars ($) as this is the major currency in which
revenues are denominated. The preparation of financial statements
requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those
estimated. Notes to Condensed Consolidated Financial Statements
(continued) Note 2: Changes in Accounting Policies There were no
changes to accounting policies in 2008 which had an effect on these
condensed consolidated financial statements, except for the
following reclassification, which has no impact on earnings,
shareholders' equity or cash flows. Comparative figures for the
condensed consolidated balance sheet have been adjusted to
reclassify derivative financial assets and liabilities as current
or non-current based on the maturity dates of the derivative
contracts. Previously, all derivatives were shown within current
assets or liabilities. Derivative assets of $199 million as at
December 31, 2007 have been reclassified as non-current assets.
Derivative liabilities of $47 million as at December 31, 2007 have
been reclassified as non-current liabilities. Note 3: Business
Combinations, Divestments and Other significant transactions
Acquisitions 2008 On November 10, 2008, Syngenta purchased 100% of
SPS Argentina SA (SPS), a company primarily specialized in the
development, production and marketing of soybean, corn and
sunflower. On November 19, 2008, Syngenta acquired 100% of
Goldsmith Seeds, Inc. (Goldsmith). Goldsmith breeds, produces and
sells a broad range of pot and bedding products, including major
crops such as cyclamen, impatiens and petunia. On December 12,
2008, Syngenta acquired the pot and garden chrysanthemum and aster
business of US flowers producer Yoder Brothers Inc. Chrysanthemums
are one of the top five selling pot and garden flowers in the
global industry. Because of the timing of these three transactions,
Syngenta is still at a preliminary stage in the purchase accounting
process. The cost of acquisition and the acquisition date carrying
amount of all the identifiable assets and liabilities acquired are
subject to finalization. $96 million, representing the sum of
goodwill and purchase accounting adjustments still to be completed,
is included within Intangible assets in the consolidated balance
sheet at December 31, 2008. Direct acquisition costs incurred to
date on these three acquisitions are $4 million. The combined
impact on profit for 2008 of the post-acquisition period trading
for the acquired businesses was $ nil. Following a public offer to
minority shareholders of Syngenta India Limited (SIL) made during
2007, Syngenta acquired a further 1.3% of SIL's share capital in
January 2008. The total shareholding of Syngenta in SIL has
increased to 96.3%. Total cash paid on all the above acquisitions
and minority shareholder transactions during 2008 was $143 million.
This represents the cost of acquisition before final adjustments.
On April 3, 2008, Syngenta acquired a 49 percent share in the
Chinese company Sanbei Seeds Co Ltd, which specializes in the
production and sale of high-quality, high-yielding corn seeds. The
purchase price was $36 million. Notes to Condensed Consolidated
Financial Statements (continued) Acquisitions 2007 Between April 20
and December 22, 2007, following a public offer to minority
shareholders of Syngenta India Ltd. (SIL), Syngenta increased its
shareholding in SIL from 84% to 95%, at a cash cost of $66 million.
SIL delisted from the Mumbai and Kolkata stock exchanges on June
20, 2007. Goodwill on this transaction was $50 million. The most
important factors contributing to the recognition of goodwill were
the economies of scale that Syngenta expects to achieve in its
global marketing, selling and distribution operations, research and
development activities, and product supply chain by consolidating
the operation of SIL with other wholly owned Indian Syngenta
subsidiaries, and making greater future use of SIL as a
manufacturing and research and development center for the global
business. On January 31, 2007, Syngenta acquired the assets of
Gromor International Corporation, which consist of peat extraction
rights over certain land in Manitoba, Canada. On July 17, 2007,
Syngenta acquired the outstanding 20% of Agrosem S.A. which it did
not already own. On June 25, 2007, Syngenta acquired 100% of the
business of the Fischer group of companies through purchases of
shares and assets. The Fischer group of companies specializes in
the breeding and marketing of flower crops. On August 31, 2007,
Syngenta purchased 100% of the shares of Zeraim Gedera Ltd., which
specializes in the breeding and marketing of vegetable crops,
including tomato, pepper and melon. Cash paid for these
acquisitions is $108 million. Goodwill on these acquisitions is $49
million. The most important factors contributing to the recognition
of goodwill on these acquisitions were the expected value of
revenue and cost synergies and other benefits from combining the
businesses of the acquired entities with those of Syngenta.
Purchase accounting was finalized in 2008: the detailed valuation
of various intangible assets is $20 million lower than the
provisional estimate made in the 2007 consolidated financial
statements, with a consequent $5 million reduction in deferred tax
liabilities and $15 million increase in goodwill. Direct
acquisition costs were $6 million. Notes to Condensed Consolidated
Financial Statements (continued) Note 4: Restructuring and
Impairment before Taxes For the year ended December 31 ($m) 2008
2007 Reversal of inventory step-up (in cost of goods sold) (9) (6)
Restructuring costs: Write-off or impairment - Property, plant and
equipment (17) (20) - Intangible assets (17) (16) - Inventories -
(2) Non-cash pension restructuring (charges) credits (2) 6 Total
non-cash restructuring costs: (36) (32) Cash costs - Operational
efficiency (80) (117) - Seeds acquisition integration (46) (9) -
Other 1 - Total cash restructuring costs (125) (126) Impairment of
financial assets (37) 2 Divestment gains 2 121 (196) (35) Total
restructuring and impairment charge (205) (41) Restructuring
represents the effect on reported performance of initiating
business changes which are considered major and which, in the
opinion of management, will have a material effect on the nature
and focus of Syngenta's operations, and therefore require separate
disclosure to provide a more thorough understanding of business
performance. Restructuring includes the effects of completing and
integrating significant business combinations and divestments. The
incidence of these business changes may be periodic and the effect
on reported performance of initiating them will vary from period to
period. Because each such business change is different in nature
and scope, there will be little continuity in the detailed
composition and size of the reported amounts which affect
performance in successive periods. Separate disclosure of these
amounts facilitates the understanding of performance including and
excluding items affecting comparability. Reported performance
before restructuring and impairment is one of the measures used in
Syngenta's short term employee incentive compensation plans.
Syngenta's definition of restructuring and impairment may not be
comparable to similarly titled line items in financial statements
of other companies. Restructuring and impairment includes the
impairment costs associated with major restructuring and also
impairment losses and reversals of impairment losses resulting from
major changes in the markets in which a reported segment operates.
Notes to Condensed Consolidated Financial Statements (continued)
2008 The Operational Efficiency program announced in February 2007
includes restructuring in Crop Protection and Seeds. The overall
cost of this program is estimated at $550 million in cash and $180
million in non-cash charges in the period up to 2011. During 2008,
restructuring charges of $19 million were incurred by Crop
Protection under this program, including $7 million for the
restructuring of the segment's product development function. Seeds
incurred charges under the program of $11 million, including $6
million for the continued restructuring of the NAFTA Corn &
Soybean marketing and sales organizations. Costs expensed as
incurred under the program relate to Crop Protection and Seeds and
consist mainly of $13 million for headquarter and information
systems restructuring charges and $24 million for further
standardization and consolidation of back office operations. Seeds
integration costs of $46 million relate mainly to the integration
and synergy program of the Fischer group, which was acquired in
2007, including severance and redundancy charges of approximately
$32 million. Seeds integration related consultancy charges of
approximately $6 million were also expensed as incurred. Non-cash
restructuring and impairment costs consist of accelerated
depreciation and property, plant and equipment write-offs from site
closures and rationalizations. Impairments of intangible assets of
$17 million include accelerated amortization of a lease related to
a Crop Protection development site, the closure of which was
announced in 2006. Impairments and write-offs of property, plant
and equipment included the $11 million write-down of a former Crop
Protection production site that was sold in 2008. Impairments of
available-for-sale financial assets total $37 million consisting
mainly of recognition of the significant decline in the share price
of Verenium (previously Diversa Corporation). Reversal of inventory
step up included in cost of goods sold in 2008 consists of the
reversal of inventory step up on the Zeraim Gedera acquisition.
2007 Syngenta incurred costs of $41 million associated with the
Operational Efficiency program announced in 2004 relating to the
implementation of the Crop Protection manufacturing site closures
announced in 2004-2006 and the continued rationalization and
relocation of Research and Technology sites announced in 2004. In
connection with the Operational Efficiency program announced in
2007, $27 million in cash costs were incurred by Crop Protection
related to the restructuring of the Development function, projects
to improve the efficiency of the distribution and manufacturing
networks and for restructuring of Crop Protection organizations
impacting sites in the UK, Switzerland, Australia, France and
Spain. Cash costs in Seeds under this program totalled
approximately $32 million for the restructuring of the NAFTA Corn
& Soybean marketing and sales organizations, the exit of an
onerous supply contract and exiting unprofitable crops in
unprofitable geographies. In addition, headquarter and information
systems restructuring activity incurred costs of $17 million. Seeds
acquisition integration costs of $9 million relate to the
integration of the acquired Fischer group and Emergent Genetics
Vegetable A/S. Notes to Condensed Consolidated Financial Statements
(continued) Non-cash restructuring and impairment costs consist of
accelerated depreciation and property, plant and equipment
write-offs from site closures and rationalizations announced prior
to and during 2006. Impairments of intangible assets largely relate
to accelerated amortization of a lease on a Crop Protection
development site, referred to in the above discussion on 2008
restructuring costs. Divestment gains of $121 million were realized
mainly from the sale of a major part of the Rosental site in Basel
and from the sale of land in Switzerland. Reversal of inventory
step up included in cost of goods sold in 2007 includes the
reversal of inventory step up on the EGV and Zeraim Gedera
acquisitions. Note 5: Principal Currency Translation Rates As an
international business selling in over 100 countries, with major
manufacturing and R&D facilities in Switzerland, the UK and the
USA, movements in currencies impact business performance. The
principal currencies and exchange rates against the US dollar used
in preparing the financial statements contained in this
communication are as follows: Average Period ended December 31 2008
2007 2008 2007 Brazilian real BRL 1.79 1.96 2.33 1.78 Swiss franc
CHF 1.08 1.20 1.06 1.13 Euro EUR 0.68 0.73 0.71 0.68 British pound
GBP 0.53 0.50 0.69 0.50 The above average rates are an average of
the monthly rates used to prepare the condensed consolidated income
and cash flow statements. The period end rates were used for the
preparation of the condensed consolidated balance sheet.
Supplementary Financial Information Financial Summary Ex
Restructuring & Restructuring & As reported under
Impairment(1) Impairment IFRS For the year ended December 31 ($m)
2008 2007 2008 2007 2008 2007 Sales 11624 9240 - - 11624 9240 Gross
profit 5920 4577 (9) (6) 5911 4571 Marketing and distribution
(2039) (1638) - - (2039) (1638) Research and development (969)
(830) - - (969) (830) General and administrative (849) (604) - -
(849) (604) Restructuring and impairment - - (196) (35) (196) (35)
Operating income 2063 1505 (205) (41) 1858 1464 Income before taxes
1897 1460 (205) (41) 1692 1419 Income tax expense (357) (346) 50 38
(307) (308) Net income 1540 1114 (155) (3) 1385 1111 Attributable
to minority interests - 2 - - - 2 Attributable to Syngenta AG
shareholders: 1540 1112 (155) (3) 1385 1109 Earnings/(loss) per
share(3) - basic $16.40 $11.59 $(1.65) $(0.03) $14.75 $11.56 -
diluted $16.26 $11.45 $(1.63) $(0.03) $14.63 $11.42 2008 2007 2008
CER(2) Gross profit margin excluding restructuring and impairment
50.9% 49.5% 50.5% EBITDA(4) 2494 1902 EBITDA margin 21.5% 20.6%
20.8% Tax rate on results excluding restructuring and impairment
19% 24% Free cash flow(5) 761 802 Trade working capital to sales(6)
30% 34% Debt/Equity gearing(7) 32% 23% Net debt(7) 1886 1385 (1)
For further analysis of restructuring and impairment charges, see
on page 17. Net income and earnings per share excluding
restructuring and impairment are provided as additional
information, and not as an alternative to net income and earnings
per share determined in accordance with IFRS. (2) For a description
of CER see Appendix A on page 26. (3) The weighted average number
of ordinary shares in issue used to calculate the earnings per
share were as follows: for 2008 basic EPS 93,916,415 and diluted
EPS 94,696,762; 2007 basic EPS 95,973,958 and diluted EPS
97,143,368. (4) EBITDA is defined in Appendix B on page 26. (5) For
a description of free cash flow, see Appendix E on page 29. (6)
Period end trade working capital as a percentage of twelve-month
sales, see Appendix F on page 29. (7) For a description of net debt
and the calculation of debt/equity gearing, see Appendix G on page
30. Full Year Segmental Results excluding Restructuring and
Impairment Full Year 2008 Full Year 2007 CER Syngenta $m $m % Third
party sales 11624 9240 + 21 Gross profit 5920 4577 + 23 Marketing
and distribution (2039) (1638) - 21 Research and development (969)
(830) - 15 General and administrative (849) (604) - 32 Operating
income 2063 1505 + 27 EBITDA(1) 2494 1902 + 22 EBITDA (%) 21.5 20.6
Crop Protection $m $m % Total sales 9231 7285 + 22 Inter-segment
elimination (73) (68) + 8 Third party sales 9158 7217 + 22 Gross
profit 4806 3680 + 25 Marketing and distribution (1474) (1167) - 23
Research and development (556) (496) - 10 General and
administrative (655) (516) - 19 Operating income 2121 1501 + 34
EBITDA(1) 2455 1821 + 28 EBITDA (%) 26.6 25.0 Seeds $m $m % Third
party sales 2442 2018 + 16 Gross profit 1120 901 + 17 Marketing and
distribution (555) (465) - 17 Research and development (343) (283)
- 19 General and administrative (173) (125) - 31 Operating income
49 28 - 59 EBITDA(1) 135 98 - 3 EBITDA (%) 5.5 4.9 Business
Development $m $m % Third party sales 24 5 n/a Gross profit 6 (1)
n/a Marketing and distribution (10) (6) - 52 Research and
development (70) (51) - 37 General and administrative (21) 37 n/a
Operating (loss) (95) (21) n/a EBITDA(1) (84) (14) n/a EBITDA (%)
n/a n/a (1) For a reconciliation of segment EBITDA to segment
operating income, see Appendix D on page 28 Second Half Segmental
Results excluding Restructuring and Impairment 2nd Half 2008 2nd
Half 2007 CER Syngenta $m $m % Third party sales 4329 3550 + 22
Gross profit 1943 1587 + 23 Marketing and distribution (1055) (858)
- 24 Research and development (509) (444) - 16 General and
administrative (381) (336) - 10 Operating income (2) (51) + 98
EBITDA(1) 212 153 + 41 EBITDA (%) 4.9 4.3 Crop Protection $m $m %
Total sales 3677 2982 + 24 Inter-segment elimination (55) (35) - 57
Third party sales 3622 2947 + 23 Gross profit 1653 1326 + 26
Marketing and distribution (793) (628) - 27 Research and
development (288) (264) - 11 General and administrative (300) (280)
- 3 Operating income 272 154 + 88 EBITDA(1) 436 315 + 44 EBITDA (%)
11.9 10.6 Seeds $m $m % Third party sales 703 600 + 17 Gross profit
325 280 + 14 Marketing and distribution (256) (226) - 15 Research
and development (180) (149) - 22 General and administrative (69)
(49) - 41 Operating income (180) (144) - 34 EBITDA(1) (137) (104) -
43 EBITDA (%) -19.4 -17.3 Business Development $m $m % Third party
sales 4 3 - 48 Gross profit (2) (1) n/a Marketing and distribution
(6) (4) - 52 Research and development (41) (31) - 31 General and
administrative (12) (7) - 68 Operating (loss) (61) (43) - 48
EBITDA(1) (54) (40) - 29 EBITDA (%) n/a n/a (1) For a
reconciliation of segment EBITDA to segment operating income, see
Appendix D on page 28 Full Year Product Line and Regional Sales
Full Year 2008 Full Year 2007 Actual CER Syngenta $m $m % % Crop
Protection 9231 7285 + 27 + 22 Seeds 2442 2018 + 21 + 16 Business
Development 24 5 - - Inter-segment elimination (73) (68) - - Third
Party Sales 11624 9240 + 26 + 21 Crop Protection Product line
Selective Herbicides 2412 2019 + 19 + 14 Non-selective Herbicides
1329 902 + 47 + 43 Fungicides 2620 2004 + 31 + 25 Insecticides 1423
1205 + 18 + 15 Seed Care(1) 830 604 + 37 + 33 Professional Products
527 475 + 11 + 8 Others 90 76 + 20 + 19 Total 9231 7285 + 27 + 22
Regional Europe, Africa and Middle East 3214 2545 + 26 + 16 NAFTA
2693 2238 + 20 + 18 Latin America 2037 1423 + 43 + 43 Asia Pacific
1287 1079 + 19 + 17 Total 9231 7285 + 27 + 22 Seeds Product line
Corn and Soybean 1040 893 + 16 + 13 Diverse Field Crops 462 351 +
32 + 23 Vegetables and Flowers 940 774 + 21 + 16 Total 2442 2018 +
21 + 16 Regional Europe, Africa and Middle East 1077 818 + 32 + 20
NAFTA 979 916 + 7 + 6 Latin America 216 146 + 48 + 48 Asia Pacific
170 138 + 23 + 24 Total 2442 2018 + 21 + 16 (1) Seed Care was
previously grouped within Professional Products Second Half Product
Line and Regional Sales 2nd Half 2008 2nd Half 2007 Actual CER
Syngenta $m $m % % Crop Protection 3677 2982 + 23 + 24 Seeds 703
600 + 17 + 17 Business Development 4 3 + 14 - 46 Inter-segment
elimination (55) (35) - - Third Party Sales 4329 3550 + 22 + 22
Crop Protection Product line Selective Herbicides 733 596 + 23 + 23
Non-selective Herbicides 590 441 + 34 + 33 Fungicides 971 821 + 18
+ 20 Insecticides 644 541 + 19 + 20 Seed Care(1) 442 305 + 45 + 43
Professional Products 238 220 + 8 + 7 Others 59 58 + 3 + 3 Total
3677 2982 + 23 + 24 Regional Europe, Africa and Middle East 964 875
+ 10 + 9 NAFTA 843 642 + 31 + 32 Latin America 1339 973 + 38 + 38
Asia Pacific 531 492 + 8 + 12 Total 3677 2982 + 23 + 24 Seeds
Product line Corn and Soybean 226 161 + 40 + 41 Diverse Field Crops
109 94 + 16 + 15 Vegetables and Flowers 368 345 + 7 + 6 Total 703
600 + 17 + 17 Regional Europe, Africa and Middle East 266 241 + 11
+ 7 NAFTA 206 194 + 6 + 6 Latin America 150 97 + 54 + 54 Asia
Pacific 81 68 + 18 + 29 Total 703 600 + 17 + 17 (1) Seed Care was
previously grouped within Professional Products Fourth Quarter
Product Line and Regional Sales 4th Quarter 4th Quarter 2008 2007
Actual CER Syngenta $m $m % % Crop Protection 1802 1546 + 17 + 21
Seeds 286 317 - 10 - 4 Business Development 2 3 - 17 - 18
Inter-segment elimination (38) (25) - - Third Party Sales 2052 1841
+ 11 + 16 Crop Protection Product line Selective Herbicides 349 310
+ 13 + 20 Non-selective Herbicides 228 191 + 20 + 23 Fungicides 517
449 + 15 + 20 Insecticides 334 269 + 24 + 27 Seed Care(1) 208 152 +
37 + 42 Professional Products 140 127 + 10 + 11 Others 26 48 - 45 -
44 Total 1802 1546 + 17 + 21 Regional Europe, Africa and Middle
East 401 423 - 5 + 5 NAFTA 338 303 + 11 + 14 Latin America 824 561
+ 47 + 47 Asia Pacific 239 259 - 8 - Total 1802 1546 + 17 + 21
Seeds Product line Corn and Soybean 82 99 - 17 - 15 Diverse Field
Crops 42 50 - 15 - 2 Vegetables and Flowers 162 168 - 5 + 2 Total
286 317 - 10 - 4 Regional Europe, Africa and Middle East 93 112 -
17 - 7 NAFTA 107 131 - 19 - 18 Latin America 43 34 + 24 + 25 Asia
Pacific 43 40 + 7 + 25 Total 286 317 - 10 - 4 (1) Seed Care was
previously grouped within Professional Products Appendices to
Supplementary Financial Information Appendix A: Constant Exchange
Rates (CER) In this report results from one period to another
period are, where appropriate, compared using constant exchange
rates (CER). To present this information, current period results
for entities reporting in currencies other than US dollars are
converted into US dollars at the prior period's exchange rates,
rather than at the exchange rates for the current year. CER margin
percentages for gross profit and EBITDA are calculated by the ratio
of these measures to sales after restating the measures and sales
at prior period exchange rates. The CER presentation indicates the
underlying business performance before taking into account currency
exchange fluctuations. Appendix B: Reconciliation of EBITDA to Net
Income EBITDA is defined as earnings before interest, tax, minority
interests, depreciation, amortization, restructuring and
impairment. Information concerning EBITDA has been included as it
is used by management and by investors as a supplementary measure
of operating performance and is used by Syngenta as the basis of
part of its employee incentive plans. Management excludes
restructuring from EBITDA in order to focus on results excluding
items affecting comparability from one period to the next. EBITDA
is not a measure of cash liquidity or financial performance under
generally accepted accounting principles and the EBITDA measures
used by Syngenta may not be comparable to other similarly titled
measures of other companies. EBITDA should not be construed as an
alternative to operating income or cash flow as determined in
accordance with generally accepted accounting principles. $m 2008
2007 Net income attributable to Syngenta AG shareholders 1385 1109
Minority interests - 2 Income tax expense 307 308 Financial
expenses, net 169 42 Pre-tax restructuring and impairment 205 41
Depreciation, amortization and other impairment 428 400 EBITDA 2494
1902 Appendix C: Segmental Results and Inter-Segment Elimination
Excluding Restructuring and Impairment Gross Operating Full Year
Segmental Results ($m) Sales profit income EBITDA Crop Protection
9231 4806 2121 2455 Seeds 2442 1120 49 135 Business Development 24
6 (95) (84) Total before inter-segment elimination 11697 5932 2075
2506 Inter-segment elimination (1) (73) (12) (12) (12) Total 11624
5920 2063 2494 Gross Operating Second Half Segmental Results ($m)
Sales profit income EBITDA Crop Protection 3677 1653 272 436 Seeds
703 325 (180) (137) Business Development 4 (2) (61) (54) Total
before inter-segment elimination 4384 1976 31 245 Inter-segment
elimination (1) (55) (33) (33) (33) Total 4329 1943 (2) 212 (1)
Crop Protection inter-segment sales to Seeds Appendix D:
Reconciliation of Segment EBITDA to Segment Operating Income Full
Year 2008 Crop Business Inter-segment $m Protection Seeds
Development elimination Total EBITDA 2455 135 (84) (12) 2494
Depreciation, amortization & impairment (334) (82) (12) (428)
Income/(loss) from associates & joint ventures - (4) 1 (3)
Operating income excl. restructuring & impairment 212 149 (95)
(12) 2063 Restructuring & impairment (1) (83) (85) (37) (205)
Operating income 2038 (36) (132) (12) 1858 Income from associates
& joint ventures 3 Financial expense, net (169) Income before
taxes 1692 Second Half 2008 Crop Business Inter-segment $m
Protection Seeds Development elimination Total EBITDA 436 (137)
(54) (33) 212 Depreciation, amortization & impairment (164)
(43) (7) (214) Income/(loss) from associates & joint ventures -
- - - Operating income excl. restructuring & impairment 272
(180) (61) (33) (2) Restructuring & impairment (1) (29) (83)
(12) (124) Operating income 243 (263) (73) (33) (126) Income from
associates & joint ventures 3 Financial expense, net (132)
Income before taxes (255) Full Year 2007 Crop Business
Inter-segment $m Protection Seeds Development elimination Total
EBITDA 1821 98 (14) (3) 1902 Depreciation, amortization &
impairment (324) (68) (8) (400) Income/(loss) from associates &
joint ventures 4 (2) 1 3 Operating income excl. restructuring &
impairment 150 128 (21) (3) 1505 Restructuring & impairment (1)
1 (44) 2 (41) Operating income 1502 (16) (19) (3) 1464 Loss from
associates & joint ventures (3) Financial expense, net (42)
Income before taxes 1419 (1) Including reversal of inventory
step-up included in Cost of Goods sold Appendix E: Free Cash Flow
Free cash flow comprises cash flow from operating and investing
activities, except investments in and proceeds from marketable
securities. Free cash flow is not a measure of financial
performance under generally accepted accounting principles and the
free cash flow measure used by Syngenta may not be comparable to
similarly titled measures of other companies. Free cash flow has
been included as it is used by many investors as a useful
supplementary measure of cash generation. For the year ended
December 31 ($m) 2008 2007 Cash flow from operating activities 1466
1168 Cash flow used for investing activities (608) (368) Cash flow
(from)/for marketable securities (97) 2 Free cash flow 761 802
Appendix F: Period End Trade Working Capital The following table
provides detail of trade working capital at the period end as a
percentage of twelve-month sales: $m 2008 2007 Inventories 3456
2647 Trade accounts receivable 2311 2386 Trade accounts payable
(2240) (1895) Net trade working capital 3527 3138 Twelve-month
sales 11624 9240 Trade working capital as percentage of sales 30%
34% Appendix G: Net Debt Reconciliation Net debt comprises total
debt net of related hedging derivatives, cash and cash equivalents
and marketable securities. Net debt is not a measure of financial
position under generally accepted accounting principles and the net
debt measure used by Syngenta may not be comparable to the
similarly titled measure of other companies. Net debt has been
included as it is used by many investors as a useful measure of
financial position and risk. The following table provides a
reconciliation of movements in net debt during the period: $m 2008
2007 Opening balance at January 1 1385 1153 Acquisitions and other
non-cash items 127 82 Foreign exchange effect on net debt 70 (11)
Purchases of treasury shares 613 662 Distributions paid to
shareholders 452 301 Free cash flow (761) (802) Closing balance as
at December 31 1886 1385 Components of closing balance: Cash and
cash equivalents (803) (503) Marketable securities(1) (7) (102)
Current financial debts 211 399 Non-current financial debts(2) 2524
1726 Financing-related derivatives(3) (39) (135) Closing balance as
at December 31 1886 1385 (1) Long-term marketable securities are
included in Financial and other non-current assets. Short-term
marketable securities are included in Financial and other current
assets (2) Included within Non-current financial debts and other
non-current liabilities (3) Included within Financial and other
non-current assets and Non-current financial debts and other
non-current liabilities The following table presents the derivation
of the Debt/Equity gearing ratio: $m 2008 2007 Net debt 1886 1385
Shareholders' equity 5884 6022 Debt/Equity gearing ratio (%) 32%
23% Glossary and Trademarks All product or brand names included in
this results statement are trademarks of, or licensed to, a
Syngenta group company. For simplicity, sales are reported under
the lead brand names, shown below, whereas some compounds are sold
under several brand names to address separate market niches.
Selective Herbicides AXIAL(R) post emergent grass weed herbicide
for wheat and barley BICEP(R) MAGNUM broad spectrum pre-emergence
herbicide for corn and sorghum CALLISTO(R) novel herbicide for
flexible use on broad-leaved weeds for corn DUAL(R) MAGNUM grass
weed killer for corn and soybeans FUSILADE(R) grass weed killer for
broad-leaf crops TOPIK(R) post-emergence grass weed killer for
wheat Non-selective Herbicides GRAMOXONE(R) rapid, non-systemic
burn-down of vegetation TOUCHDOWN(R) systemic total vegetation
control Fungicides ALTO(R) triazole fungicide for use on cereals
and coffee AMISTAR(R) broad spectrum strobilurin for use on
multiple crops BRAVO(R) broad spectrum fungicide for use on
multiple crops REVUS(TM) for use on potatoes, tomatoes, vines and
vegetable crops RIDOMIL GOLD(R) systemic fungicide for use in
vines, potatoes and vegetables SCORE(R) triazole fungicide for use
in vegetables, fruits and rice TILT(R) broad spectrum triazole for
use in cereals, bananas and peanuts UNIX(R) cereal and vine
fungicide with unique mode of action Insecticides ACTARA(R)
second-generation neonicotinoid for controlling foliar and soil
pests in multiple crops DURIVO(TM) broad spectrum, lower dose
insecticide, controls resistant pests FORCE(R) unique pyrethroid
controlling soil pests in corn KARATE(R) foliar pyrethroid offering
broad spectrum insect control PROCLAIM(R) novel, low-dose
insecticide for controlling lepidoptera in vegetables and cotton
VERTIMEC(R) acaricide for use in fruits, vegetables and cotton Seed
Care AVICTA(R) breakthrough nematode control seed treatment
CRUISER(R) novel broad spectrum seed treatment - neonicotinoid
insecticide DIVIDEND(R) triazole seed treatment fungicide MAXIM(R)
broad spectrum seed treatment fungicide Professional Products
FAFARD(R) leading producer of packaged growing media HERITAGE(R)
strobilurin turf fungicide ICON(R) public health insecticide Field
Crops AGRISURE(TM) new corn trait choices GARST(R) US brand for
corn and soybean GOLDEN HARVEST(R) brand for corn and soybean in
North America and Europe HILLESHOG(R) global brand for sugar beet
NK(R) global brand for corn, oilseeds and other field crops
Vegetables and Flowers DULCINEA(TM) consumer produce brand for
value-added fruits and vegetables in North America Fischer global
premium flowers brand Goldsmith leading producer of a broad range
of pot and bedding plats ROGERS(R) vegetables leading brand
throughout the Americas S&G(R) flowers global brand for seeds
and young plants S&G(R) vegetables leading brand in Europe,
Africa and Asia Yoder chrysanthemum and aster producer Zeraim
Gedera high quality vegetable seed brand Addresses for
Correspondence Swiss Depositary Depositary for ADRs Registered
Office SEGA Aktienregister AG The Bank of New York Syngenta AG P.O.
Box Shareholder Relations Schwarzwaldallee 215 CH-4601 Olten PO Box
11258 4058 Basel Church Street Station Switzerland New York, NY
10286 Tel: +41 (0)62 205 3695 Tel: +1 (212) 815 6917 Tel: +41 (0)61
323 1111 Cautionary Statement Regarding Forward-Looking Statements
This document contains forward-looking statements, which can be
identified by terminology such as 'expect', 'would', 'will',
'potential', 'plans', 'prospects', 'estimated', 'aiming', 'on
track' and similar expressions. Such statements may be subject to
risks and uncertainties that could cause the actual results to
differ materially from these statements. We refer you to Syngenta's
publicly available filings with the U.S. Securities and Exchange
Commission for information about these and other risks and
uncertainties. Syngenta assumes no obligation to update
forward-looking statements to reflect actual results, changed
assumptions or other factors. This document does not constitute, or
form part of, any offer or invitation to sell or issue, or any
solicitation of any offer, to purchase or subscribe for any
ordinary shares in Syngenta AG, or Syngenta ADSs, nor shall it form
the basis of, or be relied on in connection with, any contract
therefore. Media contacts: Analyst/Investor contacts: Medard
Schoenmaeckers Jennifer Gough Switzerland Switzerland +41 61 323
5059 +41 61 323 2323 USA +1 202 737 6521 Anne Burt John Hudson USA
Switzerland +41 61 323 6793 +1 202 628 2372 USA +1 202 737 6520
DATASOURCE: Syngenta CONTACT: Media, Medard Schoenmaeckers,
Switzerland, +41-61-323-2323 or Anne Burt, USA, +1-202-628-2372, or
Analyst/Investors, Jennifer Gough, Switzerland, +41-61-323-5059 or
USA, +1-202-737-6521, or John Hudson, Switzerland, +41-61-323-6793
or USA, +1-202-737-6520, all of Syngenta Web Site:
http://www.syngenta.com/
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