Financial summary for North Sugar 2024-25: profitable results despite a significant drop in EU sugar market prices
Nordzucker AG Reports Resilient Results in Challenging Sugar Market
Financial Year 2024/25 concludes with a positive operating result for Nordzucker AG, despite a worsening market environment in the European sugar sector. The company's Operating Income (EBIT) stood at €100 million, a significant drop from the previous year's €421 million, while revenue fell to €2.770 billion from €2.923 billion [1][5].
The decline in revenue and profitability was primarily attributed to a sharp fall in sugar prices within the EU, coupled with abundant beet harvests, leading to an oversupply of sugar and muted consumer demand. Additionally, sugar imports from Ukraine made their way into the European market [5].
Lars Gorissen, the CEO, remarked at the annual report's presentation in Braunschweig, "The sugar price in Europe has fallen more sharply than initially anticipated. Both extensive harvests and a subdued consumer demand have contributed to the difficult market situation." Nevertheless, Nordzucker achieved a significantly positive consolidated net income in the 2024/25 financial year, with plans to propose a dividend of €0.40 per share at the Annual General Meeting on 10th July 2025 [5].
The company produced around three million metric tons of sugar, an all-time high, under favorable growing conditions [5]. Although the net income before extraordinary items dropped to €84 million compared to €326 million in the previous year, the Australian subsidiary, Mackay Sugar Ltd., contributed €14 million to the operating result [5].
Alexander Bott, the CFO, stated, "In the first months, Nordzucker profited from high selling prices. However, the operating result developed as expected from October 2024 onwards, with our competitive cost structure, distinctive market positioning, particularly in Scandinavia, as well as Mackay Sugar Ltd.'s positive contribution, enabling us to present a positive result for the 2024/25 financial year." Other factors burdening the operating result included high raw material and logistics costs and special effects [5].
For the upcoming financial year 2025/26, Nordzucker anticipates a negative result in the lower double-digit million range. However, the company has implemented various cost optimization measures and intensified its excellence programs to cushion the blow from the challenging market situation and maintain positive results [5].
The EU sugar market appears to be stabilizing, with a reduction in the beet cultivation area observed this year. Nordzucker has consequently adjusted its beet contracts accordingly, contributing to market relief [5]. Alexander Godow, the COO, added, "Due to the smaller cultivation areas in the EU, a relaxation is already evident. The sugar prices are currently stabilizing at a low level, with the price trough already passed. Nevertheless, significant price increases are not expected until October 2025."
In light of these market fluctuations, Nordzucker intends to reduce its dependence on the volatile EU sugar market and increase its earning capacity and dividends through investment in sustainability and operational excellence within its core business. Furthermore, diversification in other business areas is on the horizon [1][5].
To offset potential weaknesses in Europe, Nordzucker aims to expand its sugarcane activities globally. Mackay Sugar has demonstrated that Nordzucker successfully capitalizes on growth opportunities internationally, providing a positive contribution to the overall result for more than five years. Gorissen explained, "Sugar production from sugarcane offers the potential for higher and more resilient profitability in certain regions of the world compared to sugar beet production in the EU, which can help offset fluctuations."
Climate change poses challenges for agriculture, particularly in beet crop production. Diseases transmitted by the reed leaf beetle pose a significant threat to sugar beet quality. Nordzucker is actively working with various stakeholders to develop and implement solutions that uphold the continued economic viability of sugar beet farming [3].
Nordzucker is a leading global sugar producer, primarily from sugar beets and sugarcane, and has operations in more than 20 locations across Europe and Australia. In the fiscal year 2024/25, the company achieved a turnover of €2.8 billion [6]. With a focus on regional cultivation, the highest quality standards, and full utilization of raw materials in the processing and value chain, Nordzucker is committed to realizing CO2-neutral factories by 2050 at the latest [6]. The company is driven by a team of 4,100 employees, prioritizing employee engagement, continuous improvements, and innovation [6].
[1] https://www.nordzucker.com/en/news-events/press-releases/[2] https://www.nordzucker.com/en/company/our-strategy/[3] https://www.nordzucker.com/en/sustainability/hosting-innovation/[5] Combination of original press release and Enrichment Data from source 1 and 5[6] Official Nordzucker AG website (nordzucker.com) - Research conducted to verify figures and company details.
The resilience of Nordzucker AG's results in the challenging sugar market can be attributed to strategic expansion in other business areas, particularly in sugarcane production, which offers potential for higher and more stable profitability. Despite anticipating a negative result in the lower double-digit million range for the upcoming financial year 2025/26, cost optimization measures and intensified excellence programs have been implemented to maintain positive results.
In an effort to mitigate risks associated with the volatile EU sugar market, Nordzucker plans to reduce its dependence on this market and increase its earning capacity through investment in sustainability, operational excellence, and global sugarcane activities.
