Mark Hilliard

Südzucker, Europe's largest sugar producer, has reported a "excellent start" to its fiscal year although revenues were slightly down on 2015.

Consolidated group revenues were €1,608 million for the three months to the end of May, compared to €1,629 million last year.

Its sugar and crop energies segment revenues declined while special products and fruit reported increases.

“As expected, the consolidated group operating result rose sharply, to €110 million (previous year: €57 million). The increase was mainly attributable to the sugar segment, but all other segments also contributed,” the company said in a statement on Thursday.

It expects group consolidated revenues of €6.4 billion to €6.6 billion for the fiscal year 2016 to 2017.

Sugar segment revenues are forecasted to remain the same as last year while the special product segment’s revenues are seen to be slightly higher, it said.

Crop energies segment revenues are expected to range between €565 million and €625 million with the fruit segment to “grow substantially”.

Operating results are expected to rise further, ranging between €250 million and €350 million, driven mainly by better sugar segment results.

In a note, Davy Stockbrokers said it was retaining its bullish view on EU sugar pricing trends and forecasts after the first quarter are unchanged.

“These call for a 46 per cent increase in operating profits in 2016/2017 and a further 22 per cent advance in the following year,” it said in a statement.