June 23, 2020 / 10:42 AM / 20 days ago

UPDATE 1-Sugar maker Cristal Union posts annual loss but remains confident

(Adds details, CEO comments)

PARIS, June 23 (Reuters) - French sugar maker Cristal Union, Europe’s fourth-largest sugar group, on Tuesday reported an annual net loss on low sugar prices and exceptional costs but was confident for the current season as it benefits from a rebound on the European market.

Cristal Union recorded a loss of 89 million euros ($100 million) in its 2019/20 year to Jan. 31, compared to a net loss of 99 million in the 2018/19 fiscal year. Revenue fell 6% to 1.6 billion euros.

The group said a large part of the loss was linked to the closure of two sugar factories in France which lead to exceptional costs of 61 million euros.

However, Cristal Union’s adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose to 63 million euros in 2019/20 from 10 million the previous year, including EBITDA of 45 million euros in the last quarter, it said.

Chief Executive Alain Commissaire had already expressed his optimism in late February when he said higher sugar prices, improving prospects for ethanol demand and a restructuring had brightened the group’s outlook for the coming year.

Commissaire told reporters he expected EBITDA to rise to between 160 and 200 million euros in 2020/21.

The group, which gathers 9,000 members, is studying the need for consolidation in the European sugar market in which it could potentially take part, he said.

“Contacts can be multiple but in any case they are serious. We will comment when there will be something concrete, which I hope will come soon,” Commissaire said.

Asked whether French competitor Tereos had made an offer to take over part of the plant in Toury, south of Paris, Commissaire said no offer had been made during the legal bidding period and that the factory would be dismantled next month.

$1 = 0.8873 euros Reporting by Sybille de La Hamaide; editing by Jason Neely and David Evans

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