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KWS Sa at aG
Key Figures of the KWS Group
Figures in € millions, unless otherwise specified (IFRS)
Segments of the KWS Group
Fiscal year
Net sales
Operating income (= EBIT)
as a % of net sales (= ROS)
Net income
as a % of net sales
Operative cash flow
Net cash from investing activities
Equity
Equity ratio in %
Balance sheet total
Return on equity in %
Return on assets in %
Fixed assets
Capital expenditure
Depreciation
Average number of employees
Personnel costs
Performance of KWS shares in €
Dividend per share
Earnings per share
Operative cash flow per share
Equity per share
* Dividend of € 1.00 plus anniversary bonus of € 0.20
2008/09
717.2
2007/08
599.1
77.9
10.9
50.1
7.0
82.0
– 59.4
434.5
57.5
756.0
13.0
7.8
231.9
61.1
23.3
3,215
135.0
1.80
6.98
12.42
65.83
70.1
11.7
54.6
9.1
74.6
– 18.1
398.0
59.3
671.1
15.3
9.2
197.1
30.4
17.0
2,856
119.0
1.70
7.74
11.30
60.31
2006/07
537.9
63.9
11.9
38.2
7.1
51.1
– 26.7
366.1
60.0
609.8
11.6
6.8
2005/06
505.0
46.7
9.2
28.4
5.6
53.4
– 20.1
338.0
58.6
577.0
8.9
5.3
189.4
188.6
27.2
16.1
2,739
111.3
1.40
5.61
7.74
23.8
17.0
2,652
109.1
1.20 *
4.16
8.09
55.47
51.21
Sugarbeet
KWS SAAT AG
As well as 15 subsidiaries and affiliated companies*
Net sales € 228.0 million
Operating income € 23.2 million
Corn
KWS MAIS GMBH
As well as 15 subsidiaries and affiliated companies
Net sales € 381.5 million
Operating income € 25.2 million
Cereals
KWS LOCHOW GMBH
As well as 7 subsidiaries and affiliated companies
Net sales € 84.3 million
Operating income € 12.0 million
Breeding & Services
KWS SAAT AG
As well as 14 subsidiaries and affiliated companies
Net sales € 154.2 million (net sales of third parties € 23.4 million)
Operating income € 17.5 million
* Subsidiaries and affiliated companies see page 79
This translation of the original German version of the Annual Report has
been prepared for the convenience of our English-speaking shareholders.
The German version is legally binding.
KWS Saat aG
Grimsehlstrasse 31 • 37555 Einbeck • P.O. Box 1463
Phone +49 (0) 5561/311-0 • Fax +49 (0) 5561/311-322
www.kws.com • e-mail: info@kws.com
Photos/Illustrations:
Eberhard Franke • KWS Group archive • Dominik Obertreis
Andreas Østergaard • Stefan Blume • Rüdiger Jahn • MT-Energie
KWS_GB0809_en_Cover_RZ_20091103b.indd 2
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Key Figures of the KWS Group
Figures in € millions, unless otherwise specified (IFRS)
Segments of the KWS Group
Fiscal year
Net sales
Operating income (= EBIT)
as a % of net sales (= ROS)
Net income
as a % of net sales
Operative cash flow
Net cash from investing activities
Equity
Equity ratio in %
Balance sheet total
Return on equity in %
Return on assets in %
Fixed assets
Capital expenditure
Depreciation
Average number of employees
Personnel costs
Performance of KWS shares in €
Dividend per share
Earnings per share
Operative cash flow per share
Equity per share
* Dividend of € 1.00 plus anniversary bonus of € 0.20
2008/09
717.2
2007/08
599.1
77.9
10.9
50.1
7.0
82.0
– 59.4
434.5
57.5
756.0
13.0
7.8
231.9
61.1
23.3
3,215
135.0
1.80
6.98
12.42
65.83
70.1
11.7
54.6
9.1
74.6
– 18.1
398.0
59.3
671.1
15.3
9.2
197.1
30.4
17.0
2,856
119.0
1.70
7.74
11.30
60.31
2006/07
537.9
63.9
11.9
38.2
7.1
51.1
– 26.7
366.1
60.0
609.8
11.6
6.8
2005/06
505.0
46.7
9.2
28.4
5.6
53.4
– 20.1
338.0
58.6
577.0
8.9
5.3
189.4
188.6
27.2
16.1
2,739
111.3
1.40
5.61
7.74
23.8
17.0
2,652
109.1
1.20 *
4.16
8.09
55.47
51.21
Sugarbeet
KWS SAAT AG
As well as 15 subsidiaries and affiliated companies*
Net sales € 228.0 million
Operating income € 23.2 million
Corn
KWS MAIS GMBH
As well as 15 subsidiaries and affiliated companies
Net sales € 381.5 million
Operating income € 25.2 million
Cereals
KWS LOCHOW GMBH
As well as 7 subsidiaries and affiliated companies
Net sales € 84.3 million
Operating income € 12.0 million
Breeding & Services
KWS SAAT AG
As well as 14 subsidiaries and affiliated companies
Net sales € 154.2 million (net sales of third parties € 23.4 million)
Operating income € 17.5 million
* Subsidiaries and affiliated companies see page 79
This translation of the original German version of the Annual Report has
been prepared for the convenience of our English-speaking shareholders.
The German version is legally binding.
KWS Saat aG
Grimsehlstrasse 31 • 37555 Einbeck • P.O. Box 1463
Phone +49 (0) 5561/311-0 • Fax +49 (0) 5561/311-322
www.kws.com • e-mail: info@kws.com
Photos/Illustrations:
Eberhard Franke • KWS Group archive • Dominik Obertreis
Andreas Østergaard • Stefan Blume • Rüdiger Jahn • MT-Energie
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Table of contents
Foreword of the Executive Board
Spotlight topic: 25 years of PLANTA – Biotechnology at KWS
Report of the Supervisory Board
Corporate Governance Report
Compliance declaration in accordance with Section 161 AktG
(German Stock Corporation Act)
The KWS share
Management Report of the KWS Group
• Sugarbeet segment
• Corn segment
• Cereals segment
• Breeding & Services segment
• Outlook for the fiscal year 2009/2010
• Risks and chances for future development
• Employees
• Compensation Report
• Disclosures in accordance with Section 315 (4) HGB (German Commercial Code)
Annual Financial Statements of the KWS Group
Auditor’s Report
Agenda of the Annual Shareholders’ Meeting / Financial calendar
7
10
12
15
16
17
20
26
28
30
32
35
38
40
44
46
47
81
82
Table of contents I 5
Foreword of the Executive Board
Dr.ChristophAmberger
Dr.HagenDuenbostel
Dr.LéonBroers
PhilipvondemBussche(CEO)
Corn, Cereals, Marketing
Finance, Controlling, Legal,
Research and Breeding,
Corporate Affairs, Sugarbeet,
Information Technology
Energy plants
Human Resources
This year’s Annual Report shows that KWS is continuing to
grow and flourish. The work of a plant breeder has a long
time horizon and is thus less subject to general economic
influences than are other industries. Despite the global
financial and economic crisis, we are in the happy position
of being able to present another very successful year for
your KWS. Of course, the crisis has also had negative influ-
ences on us. Nevertheless, we have sharply increased our
research and development budget as part of our longterm
strategy. This strategy has produced successful varieties
and good competitive positions in 70 countries around the
world. In the year under review, the KWS Group was there-
fore able to grow net sales by almost 20 % and improve its
operating income (EBIT) by 11 %.
This gratifying performance reflects the achievements of
our 3,200 employees, who have earned a high level of trust
of our customers in Germany and abroad through their ex-
pertise and their commitment.
Corn seed business again exceeded our expectations.
We were able to further increase our market share in
Europe. Net sales in North America rose sharply, par-
ticularly as a result of continuing growth in demand for
genetically modified corn varieties.
In the sugarbeet segment, we were able to halt the down-
ward trend triggered by reform of the European Sugar
Market Regime. In particular, the very strong demand in
the U. S. for herbicide-tolerant Roundup Ready® sugarbeet
from KWS contributed to the further rise in net sales.
In addition, the cereals segment generated good growth,
primarily with hybrid rye business. One factor contributing
to growth at the breeding & services segment was our
potato activities, which were launched in the joint venture
Van Rijn – KWS B.V. at the beginning of the fiscal year.
To help us keep on expanding our good market position,
we approximately doubled our capital spending compared
with the previous year. These investments included our new
engagement in seed potato business and construction of
an environmentally friendly, resource-saving development
center at our headquarters in Einbeck, where we convert-
ed a seed storehouse dating from 1948. In acknowledge-
ment of this project, KWS was presented with the 2009
“Energy-Optimized Construction” award by the German
Ministry of Economics and Technology in May 2009.
With our investments, we have selectively created new
jobs, increasing the workforce by around 10 % worldwide
and by almost 8 % in Germany in the past fiscal year.
Our headquarters in Einbeck benefited particularly from
this development. The quality of jobs at our company is
vital to our sustained success. The German Minister of
Family Affairs acknowledged this when she bestowed the
“Family-Friendly Business” award on KWS in June 2009.
The independent jury was especially impressed by the
flexible working time models.
A sense of responsibility for humankind and nature is deeply
entrenched at KWS. KWS also takes a responsible approach
in its use of biotechnology. This year our research company
PLANTA Angewandte Pflanzengenetik und Biotechnologie
GmbH celebrated its 25th anniversary. Our unchanging vision
over all these years has been the pursuit of genetic engineer-
ing methods when traditional methods run up against their
limitations. Although we have successfully developed prod-
ucts, however, we have not yet been able to launch a single
one on the European market. The emotional and often
subjective discussion of this matter endangers the continuing
development in Germany of a key technology of the 21st
century. One must ask whether a policy of doing nothing
will help solve the world‘s supply problems. Some 60 %
of the potential global harvest is still destroyed by pests,
diseases and negative weather influences.
We will continue to optimize our products and services for
our customers out of a sense of responsibility for our com-
pany and its future. This includes offering our employees
family-friendly jobs so that they can develop their abilities
to the fullest. We take our responsibility toward society
seriously, as is evidenced by our ecology-friendly production
methods and an open information policy. Our shareholders
benefit from this responsible corporate policy through solid
business performance and long-term growth in the value
of KWS.
With best regards from Einbeck on behalf of the entire
Executive Board,
Philip von dem Bussche
(CEO)
Foreword of the Executive Board I 7
Inmitten der Schwierigkeiten liegt die
The only real valuable thing is intuition.«
Möglichkeit.«
AlbertEinstein,physicist
AlbertEinstein,Physiker
Inplantbreeding,wecanchooseourparents.Onlybychoosingtherightcrossing
InderPflanzenzüchtungentwickelnwirKulturpflanzenständigweiter:soerhaltenwir
partnerscanwereachourenvisagedgoal:Vitalityandyield.
ertragreicheundrestistenteSorten,diewenigerWasserundAnbauflächeverbrauchen.
KWS_GB0809_en_Image_RZ_20091112.indd 8-9
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Spotlight topic:
25 years of PLANTA – Biotechnology at KWS
In 1984, the year PLANTA was founded, everyone was talking about biotechnology. There was speculation
at the time that it would soon replace traditional plant breeding. KWS, however, came up with a different
concept: the efficient intermeshing of conventional breeding methods with biotechnology tools.
But just what is behind the buzzword “biotechnology”?
Were we embarking on completely new territory back then?
No. 5,000 years ago, people used what they knew about
yeast to make bread and wine, while the ancient Egyptians
selectively chose plants with certain characteristics for
breeding. So even that long ago, people made conscious
use of biological processes – and that is precisely what
biotechnology is.
What exactly does PLANTA do?
Generally speaking, PLANTA has two main missions: It is
the service provider for practical breeding within the KWS
Group and also the competence center for our application-
oriented research. These services as well as biotechnological
genome research are carried out primarily in three depart-
ments: Marker Service, Molecular and Cell Biology Research
and the Cell Service working group.
The accelerating pace of technical developments in micro-
scopy gave biochemists, microbiologists and, finally, molec-
ular biologists deeper and deeper insights into new worlds.
The father of today’s “green” or plant biotechnology is the
English natural scientist Charles Robert Darwin. With his
findings on the origin of species, which he published exactly
150 years ago, and his observations on the mechanisms of
natural selection, he paved the way for modern plant genet-
ics and its use in breeding.
Why was PLANTA founded?
A General Research working group at KWS had been exam-
ining the possibility of using molecular biology techniques
for breeding since the mid-1970s. The declared objective
was – and still is – to tap the potential of this relatively
young technology to add to KWS’ specialized plant breed-
ing know-how and to combine the two. With an eye to
implementing this concept as efficiently as possible, the
subsidiary PLANTA Angewandte Pflanzengenetik und
Biotechnologie GmbH was established in 1984 to focus
solely on the area of biotechnology research. The dizzying
pace at which biotechnological research has progressed
over the past 25 years can be seen from PLANTA’s rapid
growth: From two permanent employees at its launch,
PLANTA now employs more than 100 scientists and
scientific technologists in its laboratories.
Why are genes marked?
Just as important passages of a text are highlighted with
neon-colored markers, our employees at the Marker Service
department identify and “mark” individual parts of a genome
that are responsible for certain characteristics, such as
resistance. This gradually creates a topographic map of a
plant’s genetic material – a genetic fingerprint, as it were.
This technology is of enormous practical benefit to breeders:
Using the parents’ fingerprints, our breeders can determine
which valuable characteristics have been passed on to the
next generation in the crossing process. This is a rapid and
precise means of selection in developing new varieties.
What makes breeding quicker?
Once the valuable characteristics of a plant have been
identified, the idea is to make them particularly dominant
so that they are more likely to be inherited. To achieve
that, a plant used to be crossed with itself again and again
over a period of up to eight generations. Today, the sets of
chromosomes containing the plant’s genes are doubled
by biotechnological means (double haploid technology).
The resulting homozygosity, i.e. the dominance of the
desired characteristics, can be achieved in a single
generation. Crossing two homozygous parents produces
especially vigorous and high-yielding plants – something
that is called the heterosis effect.
10
KWS_GB0809_en_Image_RZ_20091112.indd 10-11
Leaf sample for DNA analysis: What’s the essence of the plant?
113 staffers celebrate PLANTA’s birthday.
What are the advantages of gene transfer?
From the very beginning, KWS has addressed the potential
of “green genetic engineering” in its research activities, but
without regarding molecular research as the sole solution
to all problems or one that might replace traditional breeding
approaches. Gene transfer is a scientifically very demanding
and cutting-edge process. If certain genes with specific
characteristics can successfully be transferred from one
organism to a plant across species, important goals can
be achieved for agriculture and the environment. The goal
is to make plants resistant to diseases, pests or negative
environmental influences in order to reduce the need for
pesticides and insecticides and increase yield stability.
PLANTA’s most successful genetic engineering project to
date is the Roundup Ready® sugarbeet, the world’s first
variety with genetically engineered resistance to be used
in agriculture.
Who benefits from PLANTA’s work?
PLANTA is primarily a service provider for all of KWS’
breeding activities. Thanks to its diverse and innovative
research activities and its extensive networks in the scientific
community, it also guarantees the consistent, top-flight
quality of KWS’ varieties. Farmers around the world get
seed that is tailored specifically to their wishes and their
particular regional needs. Plant breeding stands at the
beginning of the food chain. Its mission in the face of the
global challenges of providing food and protecting the
environment is to keep increasing the yields of our crops
in the areas of food, feed and energy. Biotechnology
methods are now an indispensable tool in achieving that,
and that is why KWS will continue to make significant
investments in them.
PLANTA Angewandte Pflanzengenetik und
Biotechnologie GmbH
Its headcount demonstrates how rapidly it has grown: from two at the
beginning to the current figure of 113 scientists and laboratory staffers
PLANTA’s responsibilities:
• Molecular biology and cell biology research
• Marker service and research
• Cell Service
• Supervision of approval processes
PLANTA’s scientists have excellent networks in the “Scientific
Community” and play a major role in many projects:
• For example, in projects as part of GABI (Genome Analysis in the
Biological System of the Plant), a genome research initiative funded
by the German Federal Ministry for Education and Research
Milestones:
• 1984: Establishment of PLANTA
• 1999: Inauguration of the new laboratory building as the
headquarters of PLANTA (Biotechnology Center)
• 2000: Chancellor Schröder opens the local EXPO project
“Fascination plant breeding”. 10,000 visitors learn more at the
Biotechnology Center.
• 2007: The world’s first successful sugarbeet variety with genetically
engineered resistance (Roundup Ready®) was developed primarily
in PLANTA’s labs. Three years after its commercial launch, it is now
grown on 95% of the area used for sugarbeet in America.
Spotlight topic I 11
12.11.09 15:08
Report of the Supervisory Board
Dr. Dr. h. c. Andreas J. Büchting, Chairman of the Supervisory Board
These financial statements for 2008/2009 clearly show that
KWS is well positioned to tackle the challenges of even a
tough economic environment. Broad product diversification,
our global footprint and agricultural markets in the moder-
ate climate zones as well as a solid financial and asset
situation have limited the impact of the financial and eco-
nomic crisis on our business. The following developments in
particular have helped us weather the crisis: The reduction
of production areas resulting from the reform of the Euro-
pean Sugar Market Regime is now behind us. At the same
time, our herbicide-tolerant sugarbeet is meeting with
enormous acceptance in North America and our corn
segment is continuing its undiminished growth. At the end
of the day, this is the result of our long-term strategic
orientation – and it is also a positive confluence of events.
Cooperation with the Executive Board in a spirit of open-
ness and trust is a particular concern of the Supervisory
Board. The Supervisory Board carefully accompanied,
advised and monitored the management of KWS SAAT
AG in accordance with the law and the company’s
articles of association throughout fiscal 2008/2009.
It was involved at an early stage of all key decisions of
strategic and fundamental importance for the company
and was provided by the Executive Board with regular,
prompt and extensive information in written and oral
form. The reports by the Executive Board to the Super-
visory Board contained all relevant information on planning,
business performance and the situation of the company
and the KWS Group, including the risk situation, risk
management and compliance. Following thorough delib-
erations, the Supervisory Board approved the submitted
measures and business transactions requiring its consent.
Its detailed discussions focused on corporate policy,
corporate and financial planning, individual projects,
the competitive risk situation and risk management,
the general development of the various businesses and
profitability. The Chairman of the Supervisory Board
was also in close bilateral contact with the Chief Executive
Officer and the individual members of the Executive Board
outside of the meetings of the Supervisory Board. In addi-
tion, there were monthly meetings between the Chairman
of the Supervisory Board and the Executive Board as a whole,
where special occurrences and developments and the gen-
eral development of the various businesses were discussed.
The full Supervisory Board held five regular meetings in
fiscal 2008/2009. Its members participated in all of the
meetings, with the exception of one member who was
unable to attend two meetings due to illness.
Focal areas of deliberations
A regular subject of discussion at the full meetings of
the Supervisory Board were sales, income and employ-
ment trends at KWS SAAT AG and the KWS Group, as
well as questions relating to competition, compliance
and corporate governance.
The focus of the meeting of the Supervisory Board to dis-
cuss the financial statements on October 29, 2008, was
to examine and approve the financial statements of KWS
SAAT AG and the consolidated financial statements as of
June 30, 2008. Following the report by the independent
auditor and detailed discussion, the Supervisory Board
approved the financial statements and consolidated financial
statements. In addition, potential acquisition opportunities,
current capital spending measures and Executive Board
matters were discussed. The deliberations at the meeting
on December 15, 2008, focused on cross-segment expan-
sion of activities in Eastern Europe. The Supervisory Board
continued its deliberations on December 16, 2008, with a
discussion of the capital resources required by the subsid-
iaries and associated companies to secure their planned
growth. At this meeting, the Supervisory Board also ap-
pointed Dr. Léon Broers as a full member of the Executive
Board for a term of five years as of January 1, 2009, at the
proposal of the Committee for Executive Board Affairs.
Management Report, including the accounting reports, and
awarded them its unqualified audit certificate. The Super-
visory Board received and discussed the financial state-
ments and the Management Reports of KWS SAAT AG
and the KWS Group, along with the report by the indepen-
dent auditor of KWS SAAT AG and the KWS Group and
the proposal on utilization of the net profit for the year made
by KWS SAAT AG. In addition, the auditor concluded that
the audit of the financial statements did not reveal any facts
that might indicate a misstatement in the Declaration of
compliance with the German Corporate Governance Code
issued by the Executive Board and Supervisory Board
(cf. Clause 7.2.3 of the Corporate Governance Code).
The financial statements, Management Reports and audit
reports by the independent auditors were submitted to all
members of the Supervisory Board.
It also held detailed discussions of questions on the agenda
at its meeting to discuss the financial statements on
October 28, 2009. The auditor took part in the meeting and
reported on the main results of the audit and was also
available to answer additional questions and provide further
information for the Supervisory Board. According to the
report of the independent auditor, there were no material
weaknesses in the internal control and risk management
system in relation to the accounting process. There were
also no circumstances that might indicate a lack of impar-
tiality on the part of the independent auditor. The small
extent of services additionally provided by the independent
auditor can be seen from the Notes.
On March 11, 2009, the Supervisory Board dealt with the
current performance of KWS’ breeding activities across
all products and regions. The focus of the final meeting in
fiscal year 2008/2009 on June 23, 2009, was corporate
planning and approval of the budgets for fiscal 2009/2010.
Annual and consolidated financial statements
and auditing
Deloitte & Touche GmbH Wirtschaftsprüfungsgesellschaft,
Hanover, the independent auditor chosen at the Share-
holders’ Meeting on December 16, 2008, and commis-
sioned by the Audit Committee, has audited the financial
statements of KWS SAAT AG that were presented by the
Executive Board and prepared in accordance with the
provisions of the German Commercial Code (HGB) for fiscal
2008/2009 and the financial statements of the KWS Group
(IFRS consolidated financial statements), as well as the
Management Report of KWS SAAT AG and the KWS Group
In accordance with the final results of its own examination,
the Supervisory Board endorsed the results of the audit
with no objections, among other things as a result of the
vote by the Audit Committee. It gave its consent to the fi-
nancial statements of KWS SAAT AG, which are thereby
approved. The Supervisory Board also gave its consent to
the statements of the KWS Group, the Management Report
of KWS SAAT AG and the KWS Group Management
Report. It also endorses the proposal by the Executive
Board on the appropriation of the profits of KWS SAAT AG
after having examined it.
Corporate Governance
Other focal issues of the Supervisory Board were Corporate
Governance and control. It followed and discussed the fur-
ther development of the Corporate Governance Standards
and drove their implementation forward in cooperation with
the Executive Board.
12
Report of the Supervisory Board I 13
Supervisory Board
Dr. Carl-Ernst Büchting
Einbeck
Honorary Chairman
Hubertus von Baumbach
Ingelheim
Cathrina Claas-Mühlhäuser
Frankfurt/Main
Dr. Dr. h. c. Andreas J. Büchting
Einbeck
Chairman
Jürgen Bolduan
Einbeck
Chairman of the Central Works
Committee of KWS SAAT AG
Dr. Dietmar Stahl
Einbeck
Employee Representative
Dr. Arend Oetker
Berlin
Deputy Chairman
In order to determine whether the existing risk management
system needed to be adapted to the requirements of the
German Accounting Law Modernization Act (BilMoG),
the auditing firm KPMG was commissioned to analyze the
existing monitoring systems and determine whether there
was any need for adjustment. At their meeting on October
28, 2009, the Executive Board and the Supervisory Board
discussed updating the declaration of compliance with the
German Corporate Governance Code and issued a new
declaration in accordance with Section 161 AktG (German
Stock Corporation Act). It is permanently available to the
public on KWS SAAT AG’s Website. There were no conflicts
of interest on the part of Supervisory Board members in the
period under review.
Supervisory Board committees
In order to ensure that it discharges its duties efficiently,
the Supervisory Board has established the Committee for
Executive Board Affairs and the Audit Committee.
The Committee for Executive Board Affairs held a meeting
on September 23, 2008. Its main subject was renewal of
the contract of employment with Dr. Léon Broers. Options to
adjust the Executive Board’s compensation in accordance
with the Gesetz zur Angemessenheit der Vorstandsvergütung
(VorstAG), a law that specifies guidelines for reasonable
remuneration of board members of stock corporations, were
discussed at a meeting on September 14, 2009.
The Audit Committee held four meetings and two tele-
phone conferences in fiscal 2008/2009. It discussed the
interim reports to be published. In its meeting in the new
fiscal year on October 5, 2009, the financial statements
and accounting were discussed in the presence of the
Chief Financial Officer and the independent auditor. The
independent auditor reported in detail on all findings and
occurrences that were of importance to the Supervisory
Board in discharging its duties and that had arisen in the
course of its audit of the financial statements; the auditor
was also available to answer additional questions and pro-
vide further information to the Supervisory Board. According
to the report of the independent auditor, there were no
material weaknesses of the internal control and risk man-
agement system with regard to the accounting process.
In addition, the Audit Committee obtained the statement of
independence from the auditor in accordance with Clause
7.2.1 of the German Corporate Governance Code and
monitored the auditor’s independence. The Audit Committee
additionally satisfied itself that the regulations on internal rota-
tion pursuant to Section 319a (1) No. 4 HGB were observed
by the independent auditor.
There is also a Nominating Committee, which, however,
did not meet in this fiscal year.
Composition of the Supervisory Board
The composition of the Supervisory Board did not change
in fiscal year 2008/2009. Its composition and that of the
Audit Committee comply with the requirements of the
amended Sections 100 (5) and 107 (4) of the AktG (German
Stock Corporation Act), under which at least one independent
member must have expertise in the fields of accounting
and auditing of financial statements.
The Supervisory Board expresses its thanks to the Executive
Board and all employees of KWS SAAT AG and its subsidi-
aries once more for their successful contributions and their
commitment in fiscal 2008/2009.
Einbeck, October 28, 2009
KWS SAAT AG
Dr. Dr. h. c. Andreas J. Büchting
Chairman of the Supervisory Board
Corporate Governance Report
Sustainable, long-term corporate governance lies at the
heart of all decision-making processes at KWS. The over-
riding objective is to preserve our values as a medium-sized
plant breeder and generate higher long-term yields in agri-
culture. That secures the company’s existence and its
sustained creation of value.
and greater statutory requirements. We have therefore
established a separate central function for the KWS Group
to offer legal advice to the operating units. For example,
a Compliance Officer assists the Executive Board and
the company’s units in applying laws and regulations and
implementing suitable monitoring and control instruments.
The Executive Board and the Supervisory Board have dealt
in considerable detail with the German Corporate Govern-
ance Code and ensure that it is enforced. KWS SAAT AG
complies with its recommendations, with only one excep-
tion specific to the company and its industry as a result of its
seasonal course of business (see the Compliance decla-
ration in accordance with Section 161 AktG (German Stock
Corporation Act on page 16).
Helping secure the future
As a value-oriented, tradition-conscious agricultural com-
pany, we feel especially responsible for doing our part to
secure the future. Among other things, we are guided by
the principles of the Corporate Governance Code and the
company’s own business principles. The principles, which
are binding for all of KWS’ employees and its subsidiaries,
rest on four cornerstones:
• Communications and transparency
• Compliance
• Integrated risk management
• Responsibility for the environment and society
Solid and trustworthy Corporate Governance
The Executive Board develops the company’s strategic
orientation, coordinates it with the Supervisory Board and
ensures that it is implemented. Cooperation between the
Executive Board members at KWS is governed by a set
of bylaws; the bylaws of the Executive Board and the
Supervisory Board are published on our home page.
Compliance with statutory regulations and the company’s
ethical principles are governed at KWS by the Code of
Business Ethics, an abridged version of which is likewise
published on our home page. It offers employees a clear
guide as to what they are allowed to do in all their busi-
ness activities. The issue of compliance has increased in
complexity as a result of KWS’ strong international growth
Recognizing risks early on
An efficient risk management system secures the continued
existence and value of the company. The task of this inte-
grated system is to recognize risks to the company at an
early stage, assess their potential impact and enable us to
respond proactively and adequately. We report in detail on
the opportunities and risks at KWS on pages 38/39.
Supervision and advice in a relationship of trust
The Supervisory Board consists of six members: two em-
ployee and four shareholder representatives. This Board
appoints, supervises and advises the Executive Board
and is directly involved in decisions that are of fundamen-
tal importance for the company. The Supervisory Board
is assisted by auditors and legal experts. Its Chairman
coordinates the Board’s work in accordance with its
bylaws. As part of their relationship of trust and coopera-
tion, the Executive Board and the Supervisory Board
comply with the rules of proper corporate governance and
safeguard confidentiality.
Expanding and improving Corporate Governance
The new German Accounting Law Modernization Act
(BilMoG) expands and details important monitoring activ-
ities of the Supervisory Board and will impose further
requirements on reporting by listed companies in the future.
We are already preparing intensively for the obligatory
changes in the coming years by assessing the status quo
of our relevant control and risk management systems.
Important new requirements of the BilMoG have already
been implemented at KWS. For instance, the Supervisory
Board has established an Audit Committee chaired by
Hubertus von Baumbach, a member of management
at Boehringer Ingelheim who is responsible for finance
there. He is very well suited for this function thanks to his
adequate expertise.
14
Report of the Supervisory Board I Corporate Governance Report I 15
Compliance declaration in
accordance with Section
161 AktG (German Stock
Corporation Act)
I. The Executive Board and Supervisory Board of KWS
SAAT AG declare in compliance with Section 161 AktG
(German Stock Corporation Act) that – with the exception
of the point given below – the company has complied with
the recommendations of the German Corporate Govern-
ance Code in the version dated June 6, 2008, since the
last compliance declaration on October 29, 2008, and has
complied, does now comply, and will comply in the future
with the recommendations of the German Corporate
Governance Code in the version dated June 18, 2009.
II. Clause 7.1.2.: KWS SAAT AG publishes its consolidated
financial statements and interim reports within the period
of time defined in the regulations for the Prime Standard
of the Frankfurt Stock Exchange. It does not comply with
the recommended deadlines of 90 and 45 days respec-
tively in the German Corporate Governance Code because
of the seasonal course of its business.
This declaration has also been published on our home page
at www.kws.com.
Einbeck, October 28, 2009
For the Supervisory Board
Dr. Dr. h. c. Andreas J. Büchting
For the Executive Board
Philip von dem Bussche
Shareholders decide on fundamental matters
The Annual Shareholders’ Meeting is the highest-level
body of KWS SAAT AG. All shareholders are sent a written
Notice of the Meeting once a year through their depositary
bank. It is traditionally held at the company’s headquarters
in Einbeck. The Annual Shareholders’ Meeting elects the
Supervisory Board members. It makes decisions on impor-
tant matters, such as the appropriation of profits, capital
measures or changes to the Articles of Association. It also
selects the auditor of the financial statements. Each share
entitles its holder to one vote. To make it easier for share-
holders to cast their votes, proxies can be appointed to
vote on their behalf and in accordance with their instructions
at the Annual Shareholders’ Meeting. We also publish the
Notice of the Annual Shareholders’ Meeting, the power of
attorney and voting instruction forms for proxies and the
Annual Report on our Internet site at www.kws.com.
Transparent communications
We aim to strengthen the trust of our shareholders, busi-
ness partners, employees and the public through open-
ness and transparency. We provide regular information on
KWS’ business situation in the form of quarterly reports.
We present the company to domestic and foreign investors
at many roadshows. We publish the roadshow presentations
on our home page so that all shareholders receive the
same information at the same time. The financial calendar
gives information on the most important dates in the year.
In addition, all legally prescribed notifications and press
releases are published immediately in the Internet. The
detailed compensation report of KWS is part of the Manage-
ment Report of the KWS Group and can be found on
pages 44/45. Management regularly takes part in public
information events in order to inform the public about KWS’
responsible use of modern plant breeding methods and
“green genetic engineering” and to conduct a dialogue with
citizens on these subjects.
The KWS share
KWS is one of the world’s top five vendors of seed for agri-
cultural crops. The Group generates more than half of its
net sales from corn, almost a third from sugarbeet seed
and the remainder mainly from winter cereals. KWS is the
world leader in sugarbeet, as well as No. 1 in Germany and
No. 2 in Europe for corn and cereals. Since the company is
the only plant breeder listed on the stock exchange in Ger-
many, it attracts considerable attention from international
investors and analysts. KWS’ consistent and open informa-
tion policy has impressed 800 capital market experts from
17 countries: DIRK, the German Investor Relations Associ-
ation, awarded us third place in the 2009 German Investor
Relations Prize in the SDAX company category.
As a result of growing global demand for food and fodder
and for climate-friendly energy plants, KWS’ sales figures
are largely independent of general economic fluctuations.
Volatile prices for agricultural consumer goods, on the
other hand, impact our cost of sales. Farmers who multiply
our seed earn more than if they raised crops in their fields
for sale via the usual channels.
Until July 2008, the prices for agricultural products had
soared to new heights as a result of the strained supply
situation and speculative forward transactions. Within a few
weeks, however, the global financial and economic crisis
caused commodity prices to slump – including those for
agricultural products. In this climate, KWS’ share price
tumbled from its peak of just under € 175 on June 12, 2008,
to a low of € 70 on October 8, 2008. The following months
saw commodity prices, especially for sugar, surge again on
the world markets, and KWS’ share price rebounded at
the same time. The sugar price has now climbed to all-time
highs. On September 1, 2009, it stood at € 407, slightly
above the price for quota sugar guaranteed by the EU.
Despite some violent fluctuations and a drop of 13 percent,
KWS’ share again far outperformed the comparative
German index SDAX – which lost around one-third in value –
in the past fiscal year.
The keys to our success are our many years of experience,
independence, a solid equity ratio and – especially – inten-
sive research. In order to secure its long-term growth, KWS
sharply increased its capital spending in fiscal 2008/2009,
especially in research and development. Over approximately
Shareholder structure
on June 30, 2009
Families Büchting/
Arend Oetker/
Giesecke
56.3 %
Tessner
Beteiligungs
GmbH
10.6 %
Free float
33.1 %
the last 50 years, modern plant breeding has ensured sus-
tained progress in agricultural yields, with increases av-
eraging one to two percent a year. In view of the limited
nature of cultivation areas, the rapid growth in the world’s
population and climate change, continuously increasing
yields and sustainably safeguarding yield performance are
the main challenges facing a plant breeder. Plants are also
gaining in importance as a source of energy. The energy
plant sector now accounts for some 15 percent of KWS’
net sales. Bioenergy – especially biogas – offers an array
of advantages over other renewable energy sources: low
production costs, versatile uses, distributed production and
supply security at all times of the year and day. As a result,
it opens up new alternative revenue streams for farming.
Performance of the KWS share vs. SDAX
SDAX
KWS
110
100
90
80
70
60
50
40
8
0
/
7
0
8
0
/
8
0
8
0
/
9
0
8
0
/
0
1
8
0
/
1
1
8
0
/
2
1
9
0
/
1
0
9
0
/
2
0
9
0
/
3
0
9
0
/
4
0
9
0
/
5
0
9
0
/
6
0
9
0
/
7
0
9
0
/
8
0
9
0
/
9
0
9
0
/
0
1
16
Corporate Governance Report I Compliance declaration I KWS share I 17
KWS_GB0809_en_Image_RZ_20091112.indd 16-17
12.11.09 15:08
You see things; and you say, ‘Why?’
Nur der Boden erkennt die Güte der Saat.«
But I dream things that never were;
and I say, “Why not?”«
AntoinedeSaint-Exupéry,Schriftsteller
GeorgeBernardShaw,author
UmdieQualitätunseresSaatgutessicherzustellen,prüfenundbeurteilenunabhängige
SpezialistendieLeistungsfähigkeitundGütedesSaatgutsinoffiziellenTests.
Sowesaid:Whynotproduceenergyfromplants?
KWS_GB0809_en_Image_RZ_20091112.indd 18-19
12.11.09 15:08
Management Report of the KWS Group
Organic growth despite the global financial crisis – that is how fiscal year 2008/2009 can be summed up
for the KWS Group. Although KWS felt negative effects, especially in Southeastern and Eastern Europe,
it was able to offset them with successes in other regions. It was also helped in this by a solid financial and
assets situation as well as continuing high demand for quality seed for food and fodder and bioenergy.
Net sales and operating income surpassed the figures for the excellent fiscal year 2007/2008.
KWS’s robust strength in the face of the crisis is attributa-
ble to several factors: First, demand for seed remained
high despite the sharp slide in the price of agricultural raw
materials at the end of 2008. Overall, the company was
able to increase its volume of business with high-quality
corn, sugarbeet and cereal seed. Second, KWS tradition-
ally has solid financing. Our equity ratio of around 58 %
and high liquidity also ensured that we were able to obtain
funds in the crisis for the resources we needed at favorable
terms. Nevertheless, KWS did not escape the financial crisis
unscathed: The global economic crisis had a particularly
serious impact in Southeastern and Eastern Europe, which
also put a strain on our business there.
Effects of the financial crisis in Southeastern
and Eastern Europe
The financial crisis had a far more momentous impact on
farmers in this region than in the West. This has specific
historical grounds: After the collapse of the former Soviet
Union, many countries tried to catch up with Western stan-
dards of consumption. To this day, countries like Hungary,
Ukraine and Romania still import more than they export –
food as well as other goods. Their traditional current
account deficits were financed in the past with the aid of
direct foreign investment and loans. However, the banking
crisis meant that Western investors stopped pumping in
capital. The risk premiums for government bonds soared
in order to attract urgently needed foreign exchange.
Countries such as Hungary and Romania have already
negotiated with the International Monetary Fund to secure
emergency aid. Yet the forint, zloty, ruble and other curren-
cies plunged in value. The economic situation of farmers
deteriorated more and more as a result. High debt, tighter
availability of new loans and weak currencies meant they
were strapped for cash. As a consequence, KWS suffered
slumps in demand, especially in Southeastern Europe. The
price of seed, which is usually tied to the euro, increased
sharply for farms there as local currencies were devalued.
The liquidity problems were also the reason for additional
allowances on receivables that were necessary in this
region in the past fiscal year.
KWS’ business model in the financial
and economic crisis
KWS’ business model benefits from the steadily growing
demand for food, fodder and energy. According to the
German Foundation for World Population, the global popu-
lation is growing at an annual rate of 1.2 % – or, given the
current figure of 6.8 billion, by around the population of
Germany every year. In addition, consumer behavior is
changing as prosperity grows in newly industrializing coun-
tries such as China and India. The German Sugar Associ-
ation notes that average percapita sugar consumption in
China has increased by some 3 kg since 2005 to 12 kg –
and there is still enormous potential for growth: Consump-
tion in Europe remains more than three times as high. The
situation is similar regarding the increased demand for
meat, since greater numbers of livestock have to be fed.
That means soybean, corn and other fodders will continue
to gain in importance.
All in all, the positive conclusion is: The short-term conse-
quences of the financial crisis on the KWS Group were
more than compensated for in fiscal 2008/2009 by high
overall demand for agricultural products.
Demand for bioenergy remains high
There was a rapid drop in commodity prices over the past
12 months – including prices for energy. At the end of 2008,
the price of crude oil fell below 40 US dollars a barrel, which
diminished the attractiveness of renewable energies in
today’s deregulated markets. Nevertheless, there was no
significant slump in bioenergy production. This is due to
the fact that almost all industrialized countries are now pro-
moting renewable energies due to their concerns regarding
supply security and environmental issues. As a result, a
slump in demand cannot be foreseen at present, specific-
ally in Europe or the U.S. Moreover, the oil price rose again
at times to over 70 US dollars by mid-2009. According to
a study by the International Energy Agency, worldwide de-
mand for energy will rise by around 50 % by the year 2030.
Meeting that demand will require new sources of energy
that can gradually supplement finite fossil resources and
Seeding the Future: A farmer sows some 30 kilograms of corn on one hectare – and harvests an average of over 300 times that.
finally replace them in the long term. Efficient renewable
energies are already available for this purpose and will play
a key part in supplying energy in the future. Bioenergy will
also continue to profit from this trend.
Net sales grow in all segments
The KWS Group grew its net sales in fiscal 2008/2009 by
19.7 % to € 717.2 (599.1) million. There was an improvement
in business in Germany, where we increased net sales by
21.9 % to € 184.2 (151.1) million. Our good performance in
North America was further supported by the stronger US
dollar, compared to the previous year. Negative exchange
rate influences from Eastern, South-eastern and Central
Europe were more than offset by the US dollar’s positive
performance. Net foreign sales rose by 19 % to a total of €
533.0 (€ 448.0) million and accounted for 74.3 % (74.8 %)
of total revenue.
our expectations with an increase in net sales of 17.1 % to
€ 228.0 (194.8) million, accounting for 31.8 % (32.5 %) of
total business volume. Net sales in the cereals segment
improved by 25.1 % to € 84.3 (67.4) million, accounting –
as in the previous year – for almost 12 % of the KWS
Group’s total net sales. In the breeding & services seg-
ment, acquisition of our new potato activities meant that
sales leapt to € 23.4 million compared with € 8.0 million
the previous year.
Further intensification of breeding activities
The cost of sales increased faster than net sales, rising by
24.8 % to € 381.0 (305.4) million, in particular as a result of
higher production costs for seed multiplication. As a conse-
quence, gross profit did not increase quite as sharply as
net sales, growing by 14.5 % to € 336.2 (293.7) million.
The corn segment again performed well, growing its net
sales by 16.0 % to € 381.5 (328.9) million or 53.1 % (54.9 %)
of consolidated net sales. The sugarbeet segment exceeded
As expected, we generated economies of scale in the year
under review. Consequently, the increase in selling, admin-
istrative and R&D expenditures, which are less dependent
on net sales, was far lower relative to net sales.
20
Management Report I KWS Group I 21
KWS_GB0809_en_Image_RZ_20091112.indd 20-21
12.11.09 15:08
Selling expenses increased by 8.4 % to € 115.0 (106.1)
million. One main element here was the expansion of our
distribution structures and the systematic growth of the
KWS brand. Selling expenses fell relative to net sales to
16.0 % (17.7 %). Administrative expenses rose by 9.5 % to
€ 46.3 (42.3) million or 6.5 % (7.1 %) of net sales. We increased
expenditure on research and development by 11.0 % to
€ 89.5 (80.6) million in order to secure and strengthen our
market position.
The balance of other operating income and other operating
expenses was € – 7.5 (5.4) million. This is mainly attributable
to a greater need for allowances on receivables as a result
of the financial crisis.
Double-digit increase in operating income
The KWS Group’s operating income rose by 11.1 % to
€ 77.9 (70.1) million. Operating income in the corn segment
improved to € 25.2 (23.2) million despite further expansion
of our distribution structures and higher unit costs in seed
production. Its contribution to group income was 32.3 %
(33.1 %). The gratifying increase in net sales in the sugar-
beet segment did not have an impact on income, since
a large portion of revenues from successful business in
America benefited the breeding & services segment in
the form of internal royalties for technology. In addition,
allowances for inventories strained the segment’s operating
income, which fell by 17.4 % to € 23.2 (28.1) million as a
result. Its contribution to Group income declined to 29.8 %
(40.1 %). The cereals segment’s income comes primarily
from hybrid rye business, which makes a high contribution
to margins. Its operating income rose to € 12.0 (9.0) million
despite one-time amortization of goodwill amounting to
€ 2.0 million and accounted for 15.4 % (12.8 %) of Group
income. Meanwhile, our breeding & services segment
profited from higher internal royalties from all product
segments. For instance, it was able to share in the strong
performance of the North American market as a result of
the technology licenses for Roundup Ready® sugarbeet
mentioned above. The segment’s income improved to
€ 17.5 (9.8) million and now accounts for 22.5 % (14.0 %)
of group income.
Net income impacted by lower net financial income/
expense and higher taxes
Net financial income/expense fell by € 8.0 million to € – 2.7
(5.3) million. The previous year’s figure contained non-re-
curring profits from the disposal of investments totaling
€ 5.8 million. During the financial market crisis, net financial
KWS is investing about 20 million in Einbeck. A new competence
center for our scientists and 7,000 m² of additional greenhouse area
are under construction.
income/expense was strained by additional expenditure
on growth and investments. The result from ordinary activ-
ities was € 75.2 million and thus again at the level of the
previous year. Total tax expenditures rose to € 25.1 (20.8)
million due to lower tax-free earnings, resulting in a rise in
the tax rate for the Group from 27.6 % in the previous year
to 33.3 %. Lower net financial income/expense and the
higher tax rate reduced the KWS Group’s net income by
8.2 % to € 50.1 (54.6) million. The return on net sales after
tax was 7.0 % (9.1 %).
Investments in potato business and corn
Our capital spending on assets was aimed largely at fur-
ther improving seed quality and expanding breeding and
production capacities. The largest individual investments
related to the potato joint venture Van Rijn – KWS B.V.,
processing plants for corn seed in Romania, Turkey and
North America and a greenhouse and office space at
Einbeck. The KWS Group invested a total of € 61.1
(30.4) million in the year under review. Depreciation and
amortization was € 23.3 (17.0) million, meaning that, once
again, investments exceeded depreciation by a significant
margin. Of the total investments by the KWS Group, 24 %
went to Germany, 60 % to the rest of Europe, 11 % to North
and South America and 5 % to other countries. Just under
half of investments were made in the breeding & services
segment and almost a third in the corn segment.
of the previous year’s net profit for the non-recurring, tax-free
profits of € 5.8 million from disposal of our former potato
activities, net profit for fiscal 2008/2009 increased from
€ 48.8 million to € 50.1 million, despite a marked rise in the
tax rate. The improved earnings strength is also reflected in
the KWS Group’s operating income (EBIT), which increased
year-on-year by 11 % to € 77.9 million.
Equity enables growth
Total assets increased in fiscal 2008/2009 by € 84.9 million
to € 756.0 (671.1) million. Equity rose by € 36.5 million as
a result of the profit situation. The KWS Group continues to
have solid financing, with an equity ratio of 57.5 % (59.3 %).
Net working capital at the Group level fell in the past fiscal
year by 5 % to € 143.7 (150.9) million. Inventories at
the corn segment rose by € 22 million, while receivables
remained at the level of the previous year despite the
growth in sales.
Totaling € 338.4 (310.0) million, inventories and biological
assets and trade receivables accounted for around 44.8 %
(46.2 %) of total assets. On the balance sheet date, cash
and cash equivalents, including securities, amounted to
€ 125.6 (113.0) million.
Equity rose to € 434.5 (398.0) million, and fully covered
noncurrent assets and inventories. Debt capital increased
by a total of € 48.4 million to € 321.5 (273.1) million, in
particular as a result of unpaid royalties.
Net cash from operating activities funds investments
Net cash from operating activities increased by € 7.4 million
to € 82.0 (74.6) million. The ratio of cash flow to net sales
fell slightly to 11.4 % (12.4 %), underscoring again the KWS
Group’s great financial strength. Net funds used in investing
activities were € 59.4 (18.1) million, yielding a free cash flow
of € 22.6 (56.5) million, with net cash used in financing activ-
ities at € 9.6 (11.6) million. Net cash consequently improved
to € 117.0 (106.5) million. At the balance sheet date there
were still only slight financial borrowings of € 8.6 (6.5) million.
Short-term borrowings rose by € 40.2 million to € 222.7
million and were covered at a rate of 163 % (196 %) by
cash and cash equivalents, trade receivables and other
current assets.
Proposed appropriation of profits
The amount of the dividend depends on the KWS Group’s
earnings strength and net profit for the year. After adjustment
In view of this positive performance, the Executive and
Supervisory Boards will propose payment of a dividend
of € 1.80 for each of the 6,600,000 shares at the Annual
Shareholders’ Meeting. The positive trend in dividend
payouts is thus continuing, with a moderate increase of
6 % over the previous year (€ 1.70). A total of € 11.9 (11.2)
million will be distributed to shareholders in December 2009.
Creation of value added
Value added
29 %
Totaloutput
€ 753.0million
Raw materials and
supplies, purchased
goods and services
40 %
Other third-party goods
and services
28 %
Depreciation, amortization,
impairment losses
3 %
Distribution of value added
Minority interest 2 %
Company
16 %
Shareholders
5 %
Public sector
12 %
Lenders
3 %
Valueadded
€ 218.2million
Employees
62 %
22
Management Report I KWS Group I 23
KWS_GB0809_en_Image_RZ_20091112.indd 22-23
12.11.09 15:08
harte Arbeit und unablässlicher Einsatz
I know the price of success: dedication,
Der Preis des Erfolges ist Hingabe,
hard work, and an unremitting devotion
für das, was man erreichen will.«
to the things you want to see happen.«
FrankLloydWright,Architekt
FrankLloydWright,architect
Ausjährlichrund40.000neuenKartoffel-Klonenzüchtenwirnebenkonventionellen
Fromaround70,000newpotatoseedlings,weselectivelybreedvarietiesforecological
SortenauchgezieltSortenfürdenökologischwirtschaftendenLandwirt.
farmersinadditiontoconventionalvarieties.
KWS_GB0809_en_Image_RZ_20091112.indd 24-25
12.11.09 15:08
Sugarbeet segment
The sugarbeet segment posted record net sales in the past fiscal year 2008/2009. While global cultiva-
tion area remained constant at 4.2 million ha, KWS was able to grow net sales at the segment by 17 %.
The high acceptance of our genetically modified Roundup Ready® sugarbeet among North American
farmers made a significant contribution to this growth. Revenues in America rose by 80 %.
This is the third year since its launch that the Roundup
Ready® sugarbeet has been on the North American market.
The genetically modified, herbicide-tolerant sugarbeet
varieties were able to achieve almost complete penetration
of the market (around 95 %) in this short time. Thanks to
its good competitive position, KWS captured a market
share of almost 70 % in North America.
A further key factor in this positive sales performance is the
fact that reform of the Sugar Market Regime, which has
been underway since 2005 in the EU 27, is largely complete.
Because not all the quotas have been taken up in full, a
slight increase in cultivation area over the previous year
was recorded. The area for quota sugar therefore rose
to 1.31 (1.27) million ha. However, there are other diverse
areas in which sugarbeet can be used besides sugar
production – in the chemical industry to produce cosmet-
ics, plastics or pharmaceuticals, for example. Greater use
of sugarbeet for bioenergy and other industrial purposes
also contributed to the increase in total cultivation area in
Europe to 1.57 (1.49) million ha.
However, the financial crisis curbed the success of our
sugarbeet business and caused net sales to slump in
some regions. It had a particularly noticeable impact
on the economic situation of our customers in Central
and Eastern Europe. The rapid depreciation of national
Sugarbeet segment sales in millions of €
currencies and the fact that the price of seed, as well as
that of fertilizers, pesticides and insecticides, is largely
linked to western currencies meant that many farms had
liquidity problems. In order to protect itself against counter-
party defaults, KWS refrained in some cases from selling
seed to customers with higher liquidity risks. That led to
sharp drops in net sales, especially in the Russian Federa-
tion, Poland and Belarus.
Thanks to the previously mentioned positive factors, how-
ever, net sales in the sugarbeet segment rose to € 228.0
(194.8) million. Net sales outside the EU increased by 33.4 %
to € 116.3 (87.2) million. Net sales in the EU 27 were slightly
higher, rising by 3.8 % to € 111.7 (107.6) million.
As expected, the segment was not able to follow up on
the previous year’s successful income result. In particular,
there was a greater need for allowances for inventories,
since the crisis meant that sales of already produced
goods were lower. Added to this were foreign exchange
losses. Moreover, a large part of the revenue from our
excellent North America business went to the breeding &
services segment in the form of internal royalties, since
the Roundup Ready® sugarbeet was developed there.
Consequently, the segment’s income fell by 17.4 % to € 23.2
(28.1) million, despite a significant increase in net sales.
39.2
160.7
36.5
158.3
39.1
188.9
199.9
194.8
228.0
Domestic sales
Foreign sales
Total sales
26
2006/2007
2007/2008
2008/2009
The on-site consulting we offer customers is part of our agro service. The goal is to make the right choice for a particular location from
KWS’ current portfolio of some 250 sugarbeet varieties.
The regions
After the previous year’s huge reductions in area in Germany
as part of reform of the Sugar Market Regime, cultivation
areas for sugar production and for industrial beet expanded
again slightly. KWS was able to benefit from this trend and
further expanded its competitive position. There was also an
increase in area in France. However, the currently weaker
variety performances resulted in a drop in market share there.
A trend similar to that in Germany could be observed in
Northern Europe: a slight increase in areas and gains in
market share due to strong variety performance, especially
in the nematode-resistant segment. The picture in Central
Europe has two sides: While our sugarbeet business in the
Czech Republic, Slovakia and Lithuania benefited from
increases in area, we suffered sharp drops in revenue in
Poland as a result of the depreciation of the zloty. As de-
scribed above, weaker currencies had the effect of making
our products more expensive for Polish farmers. Conse-
quently, revenue from sales of sugarbeet seed in Poland
fell by more than 10 %.
There was a reduction in areas in Eastern Europe for the
second year in a row. In 2008, high cereal prices initially
made it more difficult to sell sugarbeet seed, while in
the 2009 cultivation year our customers began to suffer
from a lack of liquidity as a result of the economic crisis.
Consequently, the cultivation area in this region declined
by around 34 % to 1.09 million ha within two years. That
meant we were not able to avoid a drop in net sales in
the Russian Federation in the past fiscal year. However,
Ukraine’s accession to the WTO – and thus the abolition
of most import duties – had a positive influence on our
business. Lower income from Russia was more than
compensated for by additional revenue in Ukraine, with
the result that the Eastern Europe region as a whole made
a slight contribution to the segment’s growth in net sales.
Trends in Turkey remained positive. We were able to grow
seed sales significantly. Although the Turkish lira depreciated
considerably over the previous year, revenue – in euro terms –
rose by almost 30 %.
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Corn segment
The corn segment represents the key element in our successful business performance. Once again,
we posted sharply higher revenue from sales of corn seed in the year under review. The segment’s net
sales increased for the tenth year in a row – significantly again this year, rising about 16 %. Its income
beat last year’s record figure, despite a higher cost of sales.
In the past growing season of 2009, international commod-
ity prices came under pressure from the global financial
crisis, resulting in a drop in prices in the market for corn for
consumption. However, demand for corn seed was influ-
enced only indirectly by this. At the end of fiscal 2008/2009,
the corn price on the American commodity futures exchan-
ges was over 50 % lower than at July 1, 2008. In the same
period, the price of soybeans was down only about 20 %.
However, the step-up in cultivation of corn in North America
as a means of producing bioethanol (which now accounts
for around 30 % of cultivation area in the U.S.) countered the
anticipated decline in area. Corn cultivation area in America
rose slightly by 1.2 % to just over 35.2 million ha. Soybean
cultivation area expanded more strongly by comparison,
by 2.3 % to 31.4 million ha. In Europe, on the other hand,
corn cultivation area declined to 12.7 (13.5) million ha, de-
creasing in Southern and Southeastern Europe in particular.
The production of energy from plants is growing in impor-
tance in Europe, especially in Germany. Low consumer
prices have rekindled interest in production of biogas by
fermentation of biomass. The most important source of
raw material is corn. Apart from being grown for food and
fodder on some 1,700 thousand ha, corn is now cultivated
for biogas production on approximately 350 thousand ha
in Germany.
However, our customers in the markets of Southeastern
European and Eastern Europe suffered from liquidity
bottlenecks as the economic crisis unfolded. As a conse-
quence, KWS has refrained from selling seed there in some
cases because of the greater risk of counterparty defaults.
The currencies of the new EU member states in Central and
Southeastern Europe also experienced a sharp downturn
in the past fiscal year following the upward trends of the
past years. The corn segment was hit by exchange losses
totaling almost € 4 million.
Net sales in the corn segment at June 30, 2009, totaled
€ 381.5 (328.9) million, meaning it has grown at an annual
average of around 15 % over the last ten years. These
positive effects are mainly attributable to our operations in
Germany, France and Northern Europe, as well as to sales
of genetically modified varieties in North America. The
segment’s income at June 30, 2009, was € 25.2 (23.2)
million, despite higher costs of sales in seed multiplication.
Cultivation of winter rapeseed in the EU fell year-on-year by
approximately 3 %. Nevertheless, KWS was able to grow its
sales volume slightly, above all through a higher contribu-
tion from hybrids, to achieve a market share in the EU of
about 15 % in the year under review.
Corn segment sales in millions of €
62.9
212.6
77.2
251.7
94.8
286.7
275.5
328.9
381.5
Domestic sales
Foreign sales
Total sales
28
2006/2007
2007/2008
2008/2009
Not only the right variety is vital, but also the right time: The corn is harvested only when the plant’s humidity has fallen to a specific level.
On the back of a slight increase in area in North America,
our corn company AgReliant – a joint venture (50/50) with
the French breeding company Vilmorin – was able to
maintain its good market position in the American corn
belt. The main reason for the 21 % year-on-year increase
in net sales to € 285 (235) million is the higher share of
genetically modified, multiple-resistant varieties in our port-
folio. Almost 60 % of the volume sold contains a triple
stack, a genetically engineered combination of resistances
to the European corn borer, the Western corn rootworm
and the herbicide Roundup. AgReliant is still the fourth-
largest vendor of corn seed in the U.S.
KWS was able to expand its position as the second-largest
vendor of corn in Europe, mainly by winning market share
in Germany, the Benelux countries and France. It also im-
proved its market position in the other regions – despite in
some cases dramatic declines in cultivation area – by grow-
ing its sales slightly.
The sale of premium corn seed was problematic in the
spring of 2009. Insecticidal seed dressing agents have
been completely banned in some countries, Italy for exam-
ple, and they obtained approval in other countries such as
France and Germany only in the course of the sales season –
in some cases with considerably stricter requirements for
the quality of dressing imposed on the seed industry. Thanks
to rigorous quality management, we were quickly able to
meet even the more stringent conditions and ensure that
corn seed was available at the start of the sowing season.
The possibility of selling genetically modified corn varieties
in Europe has worsened further compared with 2008.
France imposed a total ban on their cultivation, for example.
In Germany, permission to grow the only approved geneti-
cally modified variety was suspended. Today, genetically
modified, insect-resistant corn varieties can only be grown in
Spain, Romania, Poland, the Czech Republic and Slovakia.
Their entire cultivation area in Europe is around 100,000 ha
(approximately 0.6 % of the area used for growing corn
in Europe).
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Cereals segment
KWS LOCHOW has for many years been the world’s undisputed specialist when it comes to breeding
high-performing hybrid rye varieties. Demand for them for cereal cultivation in Europe is steadily rising.
In the past fiscal year alone, our sales of hybrid rye seed rose by over 40 %.
Rye displays its advantages over other types of cereal to
fullest effect in lighter soils and dry locations. Yields there
are well above those of wheat, for instance. If farmers also
use a hybrid rye variety, the advantages in terms of yield
increase further. Consequently, the growth in net sales at
our cereals segment – by 25 % to € 84.3 (67.4) million –
is almost fully attributable to the success of this crop.
Despite lower prices for cereals for consumption compared
with calendar year 2007, the sowing area for cereals in Eu-
rope remained largely stable in 2008. In this environment,
we were able to maintain or increase sales revenues year-on-
year in KWS LOCHOW’s most important markets. The
German and UK markets developed very well, with growth
rates of more than 30 %. At KWS UK, this was mainly the
result of a significant increase in market share in the winter
wheat business.
Rye sales also rose sharply in Poland, although this resulted
in only a slight increase in net sales due to the fact that the
zloty fell in value against the euro. Despite strong competi-
tive pressure in France, we posted figures on a par with the
previous year, while the financial crisis had a sharp impact
in Eastern Europe – in particular in the Russian Federation,
where net sales slumped by more than 60 %. Unlike in
Southeastern Europe, where we were able to increase
sales, our main focus in Russia and Ukraine is on summer
cereal varieties. These are not sold until the spring. By then,
the financial crisis – and thus our customers’ liquidity bottle-
necks – was more serious than when seed was sold in mid-
2008 for fall planting.
KWS has maintained a partnership with the French cereals
breeder Momont for ten years in order to strengthen its
position in the French market for rapeseed hybrids and
wheat. This joint venture has successfully positioned itself
on the French market. In the past fiscal year, however,
we were forced to revise our growth expectations for our
French joint venture with the cereals breeder Momont as
a result of the fiercer competitive situation on the rapeseed
market. This necessitated amortization of goodwill, which
had a direct impact on the segment’s income.
Still, this negative impact on income was more than compen-
sated for by the high share of net sales (51 %) accounted for
by high-margin hybrid rye and the particularly good licen-
sing business in the UK. Income at the cereals segment
was € 12.0 (9.0) million at June 30, 2009, up by 33 % over
the previous year. The high return on net sales from the
previous year was increased again to 14.2 % (13.4 %). In the
final analysis, our expectations for the cereals business
were clearly exceeded.
18,000 cereal test plots in Seligenstadt near Würzburg – but only a handful of cereal varieties will finally be awarded approval.
Cereals segment sales in millions of €
26.5
28.0
Domestic sales
Foreign sales
Total sales
44.3
33.0
54.5
34.4
67.4
40.0
84.3
2006/2007
2007/2008
2008/2009
30
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Breeding & Services segment
Modern biotechnology has long been an indispensable part of conventional plant breeding. With the help
of biotechnology tools, test crossings can now be carried out more precisely and subsequent selection
sped up. An additional aspect is the cross-species transfer of individual genes – i. e. the use of previously
inaccessible genetic resources for our crops.
25 years ago, KWS founded the research company PLANTA
Angewandte Pflanzengenetik und Biotechnologie GmbH
in order to build up its own biotechnology expertise. The
company now employs 113 people at Einbeck and is an
integral part of our product development work. Apart from
services for traditional breeding activities – the creation of
homozygous double-haploid lines for breeding hybrids or
extensive DNA analyses to select the best candidates for
crossing, for example – PLANTA also works on genetically
modified products. It is therefore especially gratifying in
this anniversary year for PLANTA that, after 14 years of
development and deregulation, considerable value added
from a transgenic research project conducted by PLANTA
has been generated for the first time with our herbicide-
tolerant sugarbeet in the U.S.
In fiscal 2008/2009, the breeding & services segment
chalked up its highest-ever profit and net sales. Its net
sales, which are mainly generated from internal royalties
for the varieties it develops and licenses to KWS’ product
segments, rose by around 27 % to € 154.2 (121.8) million.
€ 23.4 (8.0) million of this was attributable to external net
sales to third parties for products from our farms and to the
net sales from our new potato joint venture Van Rijn – KWS
B.V., which were consolidated for the first time at 50 %. The
segment’s sharp increase in earnings is mainly the result
of internal royalties from the product segments. The result
was an increase in operating income to € 17.5 (9.8) million.
R & D expenditure, which grew by 11 % to € 89.5 (80.6)
million, is already accounted for in this figure. However, the
crucial factor is KWS’ innovative strength, which we measure
by the number of international distribution approvals for
our new varieties. The figure for these in fiscal 2008/2009
was 318 (266).
KWS corn hybrids on the rise
The strong development of our European corn business is
based largely on our successful special breeding programs.
In particular, the fast-maturing KWS varieties with good
cold tolerance – termed dent x flint hybrids – produced
excellent results in official performance tests. They are
preferred in all Northern European regions due to the shorter
vegetation periods there. This range of varieties covers
some 40 % of the European market. At the same time,
Marketing approval for new varieties
108
114
137
115
112
267
26
21
90
56
6
266
318
50
16
2006/2007
2007/2008
2008/2009
Sugarbeet
Corn
Cereals
Others
Total
32
Breeders ensure by means of selective pollination that the plants develop as envisioned.
our corn breeding activities are moving more and more into
the dent x dent segment. The warmer and longer vegetation
periods in the southern regions of Europe means that there
is generally a higher yield potential there. Successful expan-
sion of our dent x dent programs is therefore of great im-
portance for our business development. Especially in France,
our activities in this field are proceeding promisingly, with
steady improvement in performance. A new breeding pro-
gram in Romania is expanding KWS’ portfolio in South-
eastern Europe.
Application-oriented research
In the field of virus resistance, KWS is pursuing a genetic
engineering approach to resistance to rhizomania (root
madness) in sugarbeet. In the meantime, there is proof of
the feasibility of transgenic rhizomania resistance, even to
particularly aggressive viruses. Unlike in the conventional
approach, virus multiplication is completely inhibited in the
transgenic beet. As a result, further spreading of the virus
in a region can be prevented.
Research network
KWS has been able to expand its cooperation network at
both the national and the international level. The SYNBREED
project (total volume: € 12 million), in which the KWS
Group is the only participating plant breeding company,
has been successfully positioned in the national initiative
“Networks of Competence in Agricultural and Food Re-
search” sponsored by the German Ministry of Education
and Research and the Ministry of Food, Agriculture and
Consumer Protection. SYNBREED has an application-
oriented research approach, and its objective is to opti-
mize breeding programs. Part of this is a comparison of
the different methods used in plant and animal breeding.
These approaches are intended to lead to recommenda-
tions for optimizing breeding programs, which are then
reviewed and used by the industry partners involved.
SYNBREED is expected to bring about a paradigm shift
in knowledge-based breeding research through the com-
bination of results from genome research and know-how
in breeding methods.
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In the international arena, the “KWS-Tongji Laboratory for
Plant Molecular Biology” was inaugurated at Tongji Univer-
sity in Shanghai, China, in the fall of 2008. Chinese stu-
dents will work on research topics from KWS at this lab as
part of their master’s degree and doctoral research. Some
of them will also be taught by scientists from PLANTA.
The first students have already started their work. With this
program, KWS can enhance its local visibility as an expert
research partner, forge further important contacts and
follow developments directly.
Successful launch of new potato activities
The KWS Group has successfully repositioned itself in po-
tato breeding. On July 1, 2008, the new 50:50 joint venture
“Van Rijn – KWS B.V.” launched its international activities in
breeding, producing and distributing seed potatoes. Van
Rijn – KWS B.V., which is headquartered in Poeldijk, Neth-
erlands, operates in around 60 countries with its four sub-
sidiaries in France, the UK, Romania and Morocco and its
network of multiplication and distribution partners. Breed-
ing activities are conducted in Emmeloord, the center of
potato breeding in the Netherlands.
This new market presence was launched worldwide using
the strong brand of both partners, who jointly defined the
company’s strategic orientation. The new potato activities
have been integrated in the KWS Group’s existing distribu-
tion structures in Central and Eastern Europe, Chile, Argen-
tina and Turkey. Van Rijn – KWS B.V. generated net sales
of around € 25 million with its competitive portfolio of vari-
eties for processing and for consumption as fresh produce.
The KWS Group’s 50 % share in the joint venture Van Rijn –
KWS B.V. means that half of the net sales are reported in
the breeding & services segment.
From the flower to the fruit to the tuber: But it’s the tuber that
ultimately counts.
Outlook for the fiscal year 2009/2010
We expect that the KWS Group will post a slight increase in net sales for the current fiscal year 2009/2010,
mainly in the corn segment. While we currently anticipate a stable sales volume for the sugarbeet segment,
cereals business will probably drift lower due to a weaker market. We have budgeted a sharp increase
in research and development expenditure at the breeding & services segment, which will result in lower
income there. We intend to hire a large number of new employees for the new R&D projects. Allowing for
a slight fall in unit costs and higher R&D expenditure, we forecast that the KWS Group will generate operating
income (EBIT) at the level of fiscal 2008/2009.
Producer prices for cereals fell sharply in fiscal 2008/2009,
primarily as a result of the above-average yields in the 2008
harvest. In the past, such losses in income for farmers have
regularly induced them to use higher levels of farm saved
seed and refrain from buying certified high-yielding seed. In
view of this, we expect significantly lower net sales and in-
come at the cereals segment in 2009/2010.
The individual segments
We expect net sales at the corn segment to grow again
by just over 5 %, largely from business in the U.S. The share
of genetically engineered, multiple-resistant varieties (triple
stack) and thus higher-priced varieties will continue to in-
crease. Our objective in Europe is to maintain the very good
level of sales in the Northern regions and improve our market
position in Southern and Eastern Europe. The risks regard-
ing the liquidity of farmers, above all in Southeastern and
Eastern Europe, are difficult to assess. We are planning to
expand our seed production capacities. Now that we have
successfully completed similar projects in Romania and
Ukraine, further capital spending projects are to be initiated
in France, Turkey, Chile and Russia in the new fiscal year.
The cost of sales per unit is expected to be slightly below
that for the previous fiscal year. We anticipate that operat-
ing income will increase as net sales expand.
We see hardly any further potential for growth in the sugar-
beet segment in the current year. While the sugarbeet cul-
tivation area will decline slightly in the EU 27, above all in
Southern Europe, it will probably increase again in Eastern
Europe, the Middle East and East Asia. Reform of the Su-
gar Market Regime has been concluded in the EU 27, as
has the launch of Roundup Ready® varieties in North Amer-
ica. Consequently, we will be able to achieve growth in the-
se regions only by capturing further market share. If the
general economic situation improves, we see opportunities
mainly in Eastern Europe, the Middle East and North Africa.
Since the margins that can be achieved in these regions
are relatively low compared with those in the EU 27 and
since they involve higher selling expenses, we expect them
to make only a small contribution to income.
34
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Eine Investition in Wissen bringt immer noch
An investment in knowledge always pays
die besten Zinsen.«
the best interest.«
BenjaminFranklin,PolitikerundWissenschaftler
BenjaminFranklin,politicianandscientist
Iduismodtetuerosamelenimamquisautpatetnostoodtisetutamerciercildolortisisi
That’swhyweincreaseourresearchanddevelopmentexpendituresbyanaverage
eugueesequat,si.
of10%ayear.
KWS_GB0809_en_Image_RZ_20091112.indd 36-37
12.11.09 15:09
Risks and chances for future development
KWS’ entrepreneurial actions are geared to leveraging oppor-
tunities and weighing the associated risks in a responsible
and value-oriented manner. KWS aims to secure and expand
its leading market position as a seed breeding company.
Close contact with customers, careful observation of the
markets, our own intensive research and an active dialogue
with scientific institutions help ensure that opportunities are
identified at an early stage. Short decision-making lines in
the lean, medium-sized enterprise and an exchange of
knowledge based on trust among employees at the various
locations ensure that the company can respond quickly to
specific opportunities.
Recognizing and leveraging opportunities
The key opportunities in plant breeding lie in further increas-
ing yields while making efficient use of resources. The
world’s population is growing by about 80 million people
every year. As a result, demand for food is growing con-
stantly. At the same time, climate change is placing new
demands on plants’ ability to survive and on their yield –
as a result of aridity, heat, floods or increased attacks by
pests, for example. Renewable forms of energy are growing
in importance in view of the limited reserves of fossil fuels.
Bioenergy plays a special role in this, because plants are
not only a source of food and fodder, but also for regener-
ative raw materials that can be used to produce energy.
Of interest here is also the amendment to the “Renewable
Energy Act” (EEG) that came into effect in Germany on
January 1, 2009. It stipulates an entitlement to an – in part
higher – payment for electricity produced from renewable
energies for a period of 20 years.
Risk management
A suitable risk management system is needed to systemat-
ically and efficiently evaluate, document and thus control
risks, the likelihood of their occurrence and their potential
effects. KWS has firmly established such a system in its
corporate planning and controlling and in its reporting sys-
tem. The risk management system is based on strategic
planning and investment controlling, continuous operational
controlling and the quality and process monitoring systems.
The efficiency of the risk management system is ensured
by a clear assignment of responsibilities and internal con-
trol. The system’s working order was established by the
auditors as part of their audit of the annual financial state-
ments. External auditing by experienced auditors is con-
ducted at KWS and is a key component of risk management
in ensuring that internal controls work. Several audits are
held each year, covering processes and organizational
units. The goals are to optimize internal control systems
and to increase efficiency.
The KWS Group is subject to the usual economic and polit-
ical risks in the countries in which it operates. In addition,
the risks described below may significantly impair KWS’
net sales, financial position and performance. These risks
have either been identified or are regarded as likely. How-
ever, other risks that have not yet been recognized or have
been underestimated may also influence its business. No
risks that pose a threat to the company’s existence have
been identified to date. There was no significant change in
the risk situation in fiscal 2008/2009 compared with that
of the previous year.
The medium-term sales risk depends on product perform-
ance and the competitive situation. KWS addresses this
challenge with systematic analyses of the market and com-
petition and by permanently developing higher-quality seed
for innovative, high-yielding plants. KWS counters the risk
of a decline in cultivation areas with its efforts to win market
share and grow sales in other areas of production. A wide-
ranging product portfolio contributes to sensible diversifi-
cation of risks. The company ensures the high quality of
its products through strict internal quality standards and
monitoring. KWS tackles the risks involved in investing in
acquisitions and research and construction projects with
efficient controlling and professional project management.
It also addresses the liquidity risk with professional cash
management, sufficient long-term, syndicated credit lines –
full use of which was not made in the year under review –
and an equity ratio of 57.5 %. It uses extensive trade credit
insurance to counter the risk of losing receivables in risky
regions and business segments – a risk that has increased
as a result of the global economic crisis. The risk of interest
rate changes and currency risks are addressed through the
usual standardized interest rate derivate hedging instruments.
Market risks
More and more of KWS’ business partners, above all in
Eastern and Southeastern Europe, have suffered liquidity
bottlenecks as a result of the global economic and financial
crisis. That means a significant increase in the risk of
insolvencies in the agricultural sector. The situation has
become particularly aggravated in Ukraine, Moldavia and
Romania. Counterclaims are also being asserted against
KWS in this connection.
In our opinion, the amendment of the law relating to the
labeling of genetically engineered food waters down the
originally stricter regulations, is inconsistent with the
principle of transparency and thus does not help build
confidence. For instance, products can be labeled as
not genetically engineered although genetically modified
production factors have been used in making them (cattle
fodder, for example).
It is not only direct legislative procedures that impact busi-
ness operations. Reservations on the part of the populace
can also influence opportunities for business development.
For example, there is strong disapproval of “green genetic
engineering” in agriculture, especially in Europe. Worldwide,
on the other hand, genetically modified crops are cultivated
on more than 125 million hectares, with remarkable econom-
ic and ecological advantages. In the U.S. in particular, it is
mainly genetically modified varieties that are cultivated and
that are helping to solve problems in agriculture. However,
rapid market penetration of our herbicide-tolerant, geneti-
cally modified sugarbeet varieties (Roundup Ready®) in the
U.S. has also provoked opposition from opponents of
genetic engineering in that country. On January 23, 2008,
environmental protection associations filed legal action
against the United States Department of Agriculture (USDA),
with the aim of revoking the approval for cultivation of
Roundup Ready® sugarbeet awarded in March 2005. An
initial ruling was pronounced in these proceedings on Sep-
tember 21, 2009, obligating the USDA to obtain a compre-
hensive environmental compatibility assessment. In the
approval process for cultivation of Roundup Ready®-tolerant
sugarbeet, the USDA had dispensed with an extensive en-
vironmental compatibility statement since this system for
protecting plants had already been used for many years and
on a broad scale for other crops. The court has not ordered
any restriction of cultivation in practice to date.
Weather-related risks
The agricultural production process of breeding and multi-
plying seed depends to a large extent on the weather.
KWS counteracts the risk of production losses as a result
of bad weather with a broad product range that needs a
variety of weather conditions for a successful harvest.
Seed multiplication is distributed over various locations in
Europe and North America. Contra-seasonal multiplication
is carried out in the winter half-year in Chile and Argentina
if there are bottlenecks in seed availability.
Clean energy from biogas helps protect the climate.
Political risks
In the strongly regulated agriculture industry, political
risks have a significant impact on business development.
The EU Sugar Market Regime, which came into effect on
July 1, 2006, and will remain in force until September 30,
2015, has a serious effect on KWS, the world market leader
in sugarbeet seed. KWS is endeavoring to compensate
for the more difficult conditions for growth in the EU 27
by increasing sales in Eastern Europe and the U.S.
Demand for high-yielding energy plants is dependent on
the price of fossil fuels and on general regulatory condi-
tions, such as government market incentive programs for
startup financing for the investments needed for bioenergy
production, admixture ratios for biofuels or regulations on
direct feeding of biogas into existing natural gas networks.
The use of state-of-the-art, internationally acknowledged
breeding methods is still impeded in Germany. That entails
serious competitive disadvantages for agriculture, research
institutions and medium-sized enterprises such as KWS, in
particular because it fails to define the issue of liability pre-
cisely and because the exact plot of areas has to be repor-
ted in the location registry. There is thus the greater risk of
destruction of trial fields.
38
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12.11.09 15:09
Employees
People, their personalities and their abilities shape our company. We at KWS are a value-oriented
company with a tradition of family ownership. Every single person makes his or her own contribution to
our good business performance and receives respect and recognition in return. In this way, we secure
the company’s long-term success and create high-quality jobs.
The KWS Group’s gratifying business development is due
largely to our motivated employees, who identify closely
with the company’s culture and objectives. One component
of that identification is trust in how the company is led –
trust that management has earned through open commu-
nication and continuing efforts to encourage personal
responsibility among employees. In addition to a remu-
neration system that reflects performance, ensuring that
employees share appropriately in the company’s success
is another part of our company’s value orientation. That is
why KWS expanded its employee participation program at
the end of 2008. By the beginning of 2009, 220 employees
in Germany and the EU had participated in an expanded
stock purchase program and acquired more than 10,000
shares on the stock market at a discount of 20 percent.
By participating in the company through acquisition of
these shares, which must be held for a minimum of four
years, our employees become co-owners of KWS.
Identifying and developing abilities
People can turn in top performances for themselves and
the company only if they are deployed in a way that best
reflects their skills and personal inclinations. Consequently,
the focus of our personnel development strategy is to iden-
tify their different talents and help them advance through
suitable training and continuing education measures. Our
employees’ willingness to continue developing their abilities
throughout their lives is a vital part of success in the face of
global competition – especially in plant breeding, a sector
that demands intensive research and development.
First prize for family-friendly KWS
The family is of special importance to KWS, not only to the
families who founded and own the company, but to its
employees as well. People can develop their abilities to the
full only if they can reconcile their careers and private lives.
That is why KWS offers not only flexitime, but also the pos-
sibility of part-time employment, in particular during parental
leave. In principle, all employees can also work from a
home office if their work permits. In addition, families can
recuperate at the company’s own rest and vacation home
in Bad Grund. In the contest “Family-Friendly Company
Southern Lower Saxony 2009,” KWS won first prize in the
category for companies with more than 100 employees.
In particular, the jury emphasized that “KWS has integrated
the long-term importance of a family-friendly spirit in the
company in exemplary fashion.”
Our junior staff members are our future
“Seeding the Future” not only applies to our products, but
also – and especially – to our employees. Our efforts are
aimed at winning qualified employees from outside the
company, where close contact with universities is essential,
but also at filling as many posts as possible with people
who have completed our own training programs. For exam-
ple, young qualified junior workers are kept on in our Junior
Staff Development Program after successfully completing
our 24-month trainee program. Here they have the opportu-
nity over a further 24 months to develop their skills and per-
sonality across disciplines in a total of five training modules.
To prepare them for their first major management tasks,
junior staffers undergo an assessment in the Orientation
Center to determine the specific areas where they need to
develop. This gives participants and their supervisors im-
portant information on what steps should be taken next.
KWS Group employees by functions
Administration
15 %
Production
20 %
Research & development
35 %
Sales & marketing
30 %
Learning together unites people: Interdisciplinary further training
is a regular part of the two-year trainee program.
The employees, their supervisor and the HR department
then decide together what individual development meas-
ures are needed for their further career.
Apart from the key challenge of developing and retaining
our junior personnel, management is increasingly address-
ing the issues of change and leadership. Tailored training
measures have been formulated to train and develop
flexibility and adaptability. The training and continuing edu-
cation of employees was intensified in Germany in fiscal
2008/2009. 913 (926) employees took part in a total of
3,106 (2,725) days of training.
training is important for the future of young people. We
therefore take our social responsibility seriously and train
young people in numbers in excess of what we actually
need ourselves. In the fiscal year 2008/2009, 75 (75)
apprentices and 15 (12) trainees were employed. The
company offers a wide variety of vocations: industrial,
marketing communications and IT specialists in the area
of business administration, technical assistants and
laboratory technicians in the field of agriculture, and in
the technical field as industrial mechanics, energy-tech
engineers specializing in plant engineering, and electron-
ics engineers for operations technology.
Employees in numbers
In the fiscal year 2008/2009, the KWS Group employed
3,215 (2,856) people worldwide, of whom 913 (860) were
at KWS SAAT AG. Personnel expenses at the KWS Group
rose to € 135.0 (119.0) million; KWS SAAT AG accounted
for € 47.3 (43.2) million of this. We are convinced that good
As an international company, we face the great challenge of
enabling cooperation among all employees across national
borders. That is why we attach great importance to helping
our junior staff gain international experience. We give busi-
ness administration apprentices and trainees the chance to
spend several weeks working at subsidiaries abroad.
Growth in the workforce
1,179
1,560
1,260
1,596
1,357
1,858
2,739
2,856
3,215
Domestic
Foreign
Total
2006/2007
2007/2008
2008/2009
40
Management Report of the KWS Group I Employees I 41
KWS_GB0809_en_Image_RZ_20091112.indd 40-41
12.11.09 15:09
Only the ideas we actually live are of
Nur das Denken, das wir leben, hat einen
any value.«
Wert.«
HermannHesse,author
HermannHesse,Schriftsteller
Wehavealongtimehorizonforourideasandeverythingwedo.Thedevelopmentof
WirkonzentrierenunsaufdienachhaltigeEntwicklungvoninnovativemSaatgut,umdie
avarietytakes10yearsormore.Inthefinalanalysis,oursuccessismeasuredbythe
EnergieversorgungundKlimaschutzinunsererGesellschaftzugewährleisten.
contributionwemaketosuccessfulandresource-friendlyagriculture.
KWS_GB0809_en_Image_RZ_20091112.indd 42-43
12.11.09 15:09
Compensation Report
The Supervisory Board’s compensation is set by the Annual
Shareholders’ Meeting at the proposal of the Executive
Board and the Supervisory Board. It is based on the size of
the company, the duties and responsibilities of the members
of the Supervisory Board and the company’s economic
situation. The remuneration includes not only a fixed payment,
but also a variable component based on the dividend paid.
Supervisory Board members receive fixed compensation of
€ 8,000 and a dividend-related payment of € 2,000 for each
€ 0.10 by which the dividend per share exceeds € 0.20.
The Chairman of the Supervisory Board receives three
times and his or her deputy one-and-a-half times the total
compensation of an ordinary member. There is currently no
extra compensation for work on committees. The Chairman
of the Audit Committee receives one-and-a-half times the
total compensation of an ordinary member of the Supervisory
Board, provided he or she does not hold the office of
Chairman or Deputy Chairman of the Supervisory Board.
The members of the Supervisory Board are reimbursed for
all expenses – including value-added tax – that they incur
while carrying out the duties of their position.
Provided that the Annual Shareholders’ Meeting resolves
to pay the proposed dividend, total compensation of the
members of the Supervisory Board will be € 360 thousand
(€ 333 thousand), excluding value-added tax. In all 80 %
(79 %) or € 288 thousand (€ 263 thousand) of the total com-
pensation is performance-related.
Fixe d
24,000.00
12,000.00
12,000.00
8,000.00
8,000.00
8,000.00
P erfor m ance-
relate d
96,000.00
48,000.00
48,000.00
32,000.00
32,000.00
32,000.00
Total
120,000.00
60,000.00
60,000.00
40,000.00
40,000.00
40,000.00
72,000.00
288,000.00
360,000.00
Supervisory Board compensation 2008/09 in €
Dr. Andreas J. Büchting*
Dr. Arend Oetker**
Hubertus v. Baumbach***
Jürgen Bolduan
Cathrina Claas-Mühlhäuser
Dr. Dietmar Stahl
* Chairman; ** Deputy Chairman; *** Chairman of the Audit Committee
At the start of fiscal 2009/2010, the Supervisory Board
and the Executive Board began deliberations on adjusting
the basis for calculating the Supervisory Board’s compen-
sation in line with the recommendations of the German
Corporate Governance Code. A proposal in this matter will
be submitted to the Annual Shareholders’ Meeting on
December 17, 2009.
The German ‘Gesetz zur Angemessenheit der Vorstands-
vergütung (VorstAG)’, a law that specifies guidelines for
reasonable remuneration of board members of stock
corporations, came into effect on August 5, 2009. The
Supervisory Board is already deliberating on necessary
adjustments to its remuneration structure. In particular,
the basis for calculating variable compensation is to extend
over several years and a stock-based program is to
produce a long-term incentive. As a result, the remune-
ration structure will be geared more strongly toward the
company’s long-term development.
The Executive Board’s current compensation is based on
the size and activity of the company, its economic and
financial situation and the level and structure of the compen-
sation received by members of the Executive Board at
Executive Board compensation 2008/09 in €
Philip von dem Bussche*
Dr. Christoph Amberger
Dr. Léon Broers
Dr. Hagen Duenbostel
* (CEO)
comparable companies. It is made up of a fixed and a
performance-related component. There are no stock-
based components at present.
The fixed compensation is paid as a monthly salary. Apart
from these salaries, there is also non-monetary compensa-
tion, such as a company car or a phone. There are also ac-
cident insurance policies for the members of the Executive
Board. The performance-related compensation is calcula-
ted on the basis of an individual percentage of the net
profit for the year for the KWS Group. Payments for duties
performed in subsidiaries and associated companies were
€ 33 thousand (€ 37 thousand) and are offset against the
performance-related payment. There is an absolute upper
limit for overall compensation.
Fixe d
B enefits
in kin d
P erfor m ance-
relate d
Total
225,000.00
17,839.90
552,160.10
795,000.00
173,235.56
20,078.22
556,686.22
750,000.00
165,000.00
17,118.14
309,845.39
491,963.53
180,000.00
18,747.34
551,252.66
750,000.00
743,235.56
73,783.60
1,969,944.37
2,786,963.53
Pension obligations are granted in the form of an obligation
to provide benefits, with the annual pensions ranging bet-
ween € 130 thousand and € 140 thousand. In fiscal
2008/2009, € 121 thousand (€ 117 thousand) was allocated
to the pension provisions in accordance with IAS 19 for pen-
sion obligations to members of the Executive Board. Pen-
sion provisions of € 1,139 thousand (€ 1,018 thousand)
were formed for the following members of the Executive
Board of KWS SAAT AG:
Compensation of former members of the Executive Board
and their surviving dependents amounted to € 1,029
thousand (€ 883 thousand). Pension provisions recog-
nized for this group of persons amounted to € 2,414
thousand (€ 2,745 thousand) as of June 30, 2009.
There are also benefit obligations backed by a guarantee
totaling € 7,728 thousand (€ 7,416 thousand).
No loans were granted to members of the Executive Board
and Supervisory Board in the year under review.
Pension commitments in €
Dr. Christoph Amberger
Dr. Hagen Duenbostel
07/01/2008
P erso n nel
ex p enses
ex p enses
Interest
06/30/2009
760,429.00
43,293.00
47,968.00
851,690.00
258,049.00
18,175.00
11,194.00
287,418.00
1,018,478.00
61,468.00
59,162.00
1,139,108.00
44
Management Report of the KWS Group I Compensation Report I 45
Annual Financial Statements of the KWS Group
2008/2009
Disclosures in accordance with Section 315 (4) HGB
(German Commercial Code)
The Executive Board provides the following explanations of
the information in accordance with Section 315 (4) HGB (Ger-
man Commercial Code) in the Group Management Report:
• The voting shares, including mutual allocations, of
the shareholders stated below each exceed 10 %
and total 10.6 %.
The subscribed capital of KWS SAAT AG is € 19,800,000.
It is divided into 6,600,000 no-par bearer shares. Each
share grants the holder one vote at the Annual Share-
holders’ Meeting.
Hans-Joachim Tessner, Goslar
Tessner Holding KG, Goslar
Tessner Beteiligungs GmbH, Goslar
There may be limitations on the voting rights for the shares
under the provisions of the German Stock Corporation Act
(AktG). For example, shareholders are barred from voting
under certain conditions (Section 136 AktG). In addition,
no voting rights accrue to the company on the basis of the
shares it holds (Section 71b AktG). The Executive Board is
not aware of any contractual restrictions relating to voting
rights or transfer of shares.
The company has been informed of the following direct or
indirect participating interests in the capital of KWS SAAT
AG in excess of 10 % of the voting rights in accordance with
Section 21 and Section 22 of the German Securities Tra-
ding Act (WpHG):
• The voting shares, including mutual allocations, of the
members, foundations and companies of the families
Büchting/Giesecke and Arend Oetker listed below each
exceed 10 % and total 56.3 %.
Dr. agr. Carl-Ernst Büchting, Einbeck
Dr. Andreas J. Büchting, Einbeck
Christiane Stratmann, Meerbusch
Dorothea Schuppert, Augsburg
Michael C.-E. Büchting, Basel
Annette Büchting, Bremen
Stephan O. Büchting-Hansing, Ammerbuch-Entringen
Elke Giesecke, Altenberge
Christa Nagel, Springe
AKB Stiftung, Hanover
Büchting Beteiligungsgesellschaft mbH, Hanover
Dr. Arend Oetker, Berlin
Kommanditgesellschaft Dr. Arend Oetker Vermögens-
verwaltungsgesellschaft mbH & Co., Berlin
Shares with special rights that grant powers of control have
not been issued by the company.
There is no special type of voting control for the participat-
ing interests of employees. Employees who have an interest
in the company’s capital exercise their control rights in the
same way as other shareholders.
At KWS SAAT AG, members of the Executive Board are
appointed and removed as provided for in Section 84 AktG.
In compliance with Sections 179 ff. AktG, amendments to
the Articles of Association of KWS SAAT AG require a reso-
lution to be adopted by the Annual Shareholders’ Meeting,
by a majority of at least three quarters of the capital stock
represented in adopting the resolution. The power to make
amendments to the Articles of Association that only affect
the wording (Section 179 (1) Sentence 2 AktG) has been
conferred on the Supervisory Board in accordance with the
Articles of Association of KWS SAAT AG.
The Executive Board is not now authorized to issue or buy
back shares.
Significant agreements subject to the condition of a change
in control pursuant to a takeover bid have not been conclud-
ed. Moreover, there are no compensation agreements be-
tween the company and the members of the Executive Board
or employees governing the case of a change in control.
Einbeck, October 8, 2009
KWS SAAT AG
THE EXECUTIVE BOARD
46
KWS_GB0809_en_Image_RZ_20091112.indd 46-47
12.11.09 15:09
Balance
sheet
at June 30, 2009;
figures in € thou-
sands, unless other-
wise specified
ASSETS
Intangible assets
Property, plant and equipment
Other financial assets
Noncurrent tax assets
Deferred tax assets
Noncurrent tax assets
Inventories and biological assets
Trade receivables
Securities
Cash and cash equivalents
Current tax assets
Other current assets
Current assets
Total assets
EQUITY AND LIABILITIES
Subscribed capital
Capital reserve
Retained earnings
Minority interest
Equity
Long-term provisions
Long-term borrowings
Trade payables
Deferred tax liabilities
Other long-term liabilities
Noncurrent liabilities
Short-term provisions
Short-term borrowings
Trade payables
Current tax payables
Other liabilities
Current liabilities
N ote N o.
06/30/2009
Previo us
year
Income statement
for the period July 1, 2008 through June 30, 2009; figures in € thousands,
unless otherwise specified
Net sales
Cost of sales
Gross profit on sales
Selling expenses
Research and development expenses
General and administrative expenses
Other operating income
Other operating expenses
Operating income
Interest and other income
Interest and other expenses
Share of profit from affiliated companies
Other income from equity investments
Net financial income/expenses
Result of ordinary activities
Income taxes
Net income for the year
Share of minority interest
Net income after minority interest
Earnings per share (in €)
N ote N o.
(18)
2008/09
717,165
381,052
336,113
Previo us
year
599,089
305,423
293,666
114,961
106,096
(19)
(20)
(21)
(22)
(24)
89,456
46,291
31,920
39,446
77,879
3,665
6,570
0
183
– 2,722
75,157
25,055
50,102
4,007
46,095
80,576
42,257
24,267
18,890
70,114
3,765
5,139
5,779
848
5,253
75,367
20,816
54,551
3,494
51,057
6.98
7.74
47,881
34,471
180,731
157,086
3,248
6,365
5,531
7,182
16,922
16,858
255,147
221,128
121,533
85,829
216,868
224,163
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
14,116
(10)
111,515
15,493
21,280
(8)
17,958
94,973
7,113
19,934
500,805
449,970
755,952
671,098
19,800
19,800
5,530
5,530
391,838
351,777
17,318
20,911
(11)
434,486
398,018
62,037
60,872
(12)
1,926
6,429
18,075
10,274
98,741
112,696
6,691
55,152
18,251
29,935
2,629
1,983
13,815
11,259
90,558
88,238
3,842
36,863
22,639
30,940
(13)
222,725
182,522
Liabilities
321,466
273,080
Total equity and liabilities
755,952
671,098
48
Annual Financial Statements I Balance sheet I Income statement I 49
KWS_GB0809_en_Bilanz_RZ_20091112.indd 48-49
12.11.09 15:10
Statement of changes in fixed assets
2008/2009 and 2007/2008
Figures in € thousands, unless otherwise specified
translatio n
C urrency
C han g es in the
c o nsol. gro u p
A d ditio ns
Gross values
Disp osals
Transfers
15,954
3,187
19,141
92
0
92
Balance
06/30/2009
5
0
5
37,621
28,298
65,919
Patents, industrial property rights
and software
Goodwill
Intangible assets
Land and buildings
Technical equipment
and machinery
Operating and office equipment
Payments on account
Balance
07/01/2008
21,634
24,183
45,817
120
928
1,048
152,231
531
120,771
53,377
5,971
– 596
226
– 350
– 189
0
0
0
0
0
0
0
0
Property, plant and equipment
332,350
translatio n
C urrency
A d ditio ns
Disp osals
Transfers
Balance
07/01/2008
10,679
667
11,346
Amortization/depreciation
Net book values
Balance
06/30/2009
Balance
06/30/2009
Previous
year
45
– 3
42
2,985
3,708
6,693
43
0
43
0
0
0
13,666
4,372
18,038
23,955
23,926
47,881
10,955
23,516
34,471
6,435
805
5,611
164,003
49,409
394
4,221
682
14
53,356
110,647
102,822
11,574
5,260
18,570
41,839
4,368
2,042
625
7,840
2,597
129,978
612
– 8,825
57,433
14,741
– 5
366,155
87,322
38,533
0
175,264
– 283
185
0
296
7,304
5,090
0
4,290
1,779
0
16,615
6,751
Financial assets
6,006
– 4
– 9
166
4,395
1,654
3,418
475
0
0
305
Assets
384,173
855
– 9
61,146
12,327
1,654
435,492
187,085
338
23,308
7,099
Patents, industrial property rights
and software
Goodwill
Intangible assets
Land and buildings
Technical equipment
and machinery
Operating and office equipment
Payments on account
Balance
07/01/2007
20,657
25,582
46,239
– 288
– 1,399
– 1,687
145,239
– 3,401
120,824
53,049
4,279
– 2,842
– 1,747
– 216
Property, plant and equipment
323,391
– 8,206
0
0
0
0
0
0
0
0
2,476
1,213
0
0
2,476
1,213
Balance
06/30/2008
2
0
2
21,634
24,183
45,817
Balance
07/01/2007
10,137
– 121
1,873
1,212
667
0
0
0
10,804
– 121
1,873
1,212
8,514
349
2,228
152,231
47,048
– 1,363
3,906
182
5,911
4,980
8,500
6,818
3,565
3,696
120,771
660
53,377
6
– 6,586
5,971
89,711
38,718
– 2,158
– 1,338
0
0
6,625
4,283
0
6,719
3,265
0
27,905
10,738
– 2
332,350
175,477
– 4,859
14,814
10,166
Financial assets
6,181
31
– 42
6
170
Assets
375,811
– 9,862
– 42
30,387
12,121
0
0
6,006
384,173
170
0
305
0
186,451
– 4,980
16,992
11,378
– 13
– 1
0
0
0
0
2
0
2
0
– 137
135
0
– 2
0
0
90,040
42,028
0
39,938
15,405
14,741
33,449
14,844
5,971
185,424
180,731
157,086
170
3,248
5,531
203,632
231,860
197,088
Balance
06/30/2008
Balance
06/30/2008
Previous
year
10,679
667
11,346
10,955
23,516
34,471
10,520
24,915
35,435
49,409
102,822
98,191
87,322
38,533
0
33,449
14,844
5,971
31,113
14,331
4,279
175,264
157,086
147,914
475
5,531
6,011
187,085
197,088
189,360
50
Annual Financial Statements I Statement of changes in fixed assets I 51
KWS_GB0809_en_Bilanz_RZ_20091112.indd 50-51
12.11.09 15:10
Statement of changes in equity
Figures in € thousands, unless otherwise specified
S u bscrib e d ca pital
C a pital reserve
e q uity fro m earnin gs
A ccu m ulate d gro u p
currency translatio n
A djust m ents fro m
R evaluatio n
reserve
Other transactio ns
E q uity
Parent company
Comprehensive other
group income
Balance as at June 30, 2007
19,800
5,530
327,302
– 7,233
55
594
346,048
Dividends paid
Other changes
Consolidated net income
Other recognized gains (losses)
Total consolidated gains (losses)
– 9,240
1,560
51,057
– 12,326
51,057
– 12,326
8
8
– 9,240
1,560
51,057
– 12,318
0
38,739
Balance as at June 30, 2008
19,800
5,530
370,679
– 19,559
63
594
377,107
Dividends paid
Changes in the
consolidated group
Other changes
Consolidated net income
Other recognized gains (losses)
Total consolidated gains (losses)
– 11,220
2,384
46,095
46,095
– 11,220
0
2,384
46,095
2,802
48,897
2,820
2,820
– 18
– 18
0
Balance as at June 30, 2009
19,800
5,530
407,938
– 16,739
45
594
417,168
M in ority interest
currency translatio n
A djust m ents fro m
Other transactio ns
E q uity
Minority interests
Comprehensive other
group income
392
– 4
20,036
– 426
– 1,993
3,494
– 200
3,294
20,911
– 594
51
– 6,384
4,007
– 673
3,334
17,318
0
– 4
0
– 4
– 200
– 200
192
– 673
– 673
– 481
Group equity
366,084
– 9,666
– 433
54,551
– 12,518
42,033
398,018
– 11,814
51
– 4,000
50,102
2,129
52,231
434,486
19,648
– 426
– 1,993
3,494
3,494
20,723
– 594
51
– 6,384
4,007
4,007
17,803
52
Annual Financial Statements I Statement of changes in equity I 53
KWS_GB0809_en_Bilanz_RZ_20091112.indd 52-53
12.11.09 15:10
Cash flow statement
Figures in € thousands, unless otherwise specified
Notes to the cash flow statement for the KWS Group
Figures in € thousands, unless otherwise specified; previous-year figures in parentheses
Net income
Depreciation/reversal of impairment losses (–) on property, plant, and equipment
Increase/decrease (–) in long-term provisions
Other noncash expenses/income (–)
Cash earnings
Increase/decrease (–) in short-term provisions
Net gain (–)/loss from the disposal of assets
N ote
2008/09
Previo us
year
50,102
23,308
– 479
1,627
74,558
23,878
– 387
54,551
16,992
1,565
– 8,830
64,278
20,089
– 6,051
Increase (–)/decrease in inventories, trade receivables, and other assets not attributable
to investing or financing activities
Increase/decrease (–) in trade payables and other liabilities not attributable to investing
or financing activities
Net cash from operating activities
– 44,201
– 27,090
28,110
81,958
23,354
74,580
(A)
Proceeds from disposals of property, plant, and equipment
Payments (–) for capital expenditure on property, plant, and equipment
Proceeds from the disposal of intangible assets
Payments (–) for capital expenditure on intangible assets
Proceeds from disposal of financial assets
Payments (–) for financial assets
Proceeds from the sale of consolidated companies and other business units
Payments (–) for the acquisition of consolidated companies and other business units
1,477
848
– 41,720
– 26,668
49
1
– 19,141
– 2,476
89
– 166
0
0
170
– 6
12,025
– 1,969
Net cash from investing activities
(B)
– 59,412
– 18,075
Equity capital increase with no effect on profits
Dividend payments (–) to shareholders parent and minority
Cash proceeds from issuance of bonds and from short- or long-term borrowings
Payments (–) to redeem borrowings
Net cash from financing activities
51
0
– 11,814
– 9,666
2,146
0
0
– 1,927
(C)
– 9,617
– 11,593
Net cash changes in cash and cash equivalents
12,929
44,912
– Effect of exchange rate changes on assets
– Effect of exchange rate changes on equity
– Others
Changes in cash and cash equivalents due to exchange rate, consolidated group,
and measurement changes
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
0
0
– 229
– 229
0
0
– 36
– 36
112,931
68,055
(D)
125,631
112,931
The cash flow statement, which has been prepared ac-
cording to IAS 7 (indirect method), shows the changes in
cash and cash equivalents of the KWS Group in the three
categories of operating activities, investing activities, and
financing activities. The effects of exchange rate changes
and changes in the consolidated group have been elimi-
nated from the respective balance sheet items, except
those affecting cash and cash equivalents.
(D) Supplementary information on the cash
flow statement
As in previous years, cash and cash equivalents are
composed of cash (on hand and balances with banks) and
current available-for-sale securities.
Cash and cash equivalents includes € 21,747 thousand
(€ 9,217 thousand) from partially consolidated companies.
(A) Cash flows from operating activities
The cash proceeds from operating activities are primarily
determined by cash earnings. They were € 74,558 thousand,
€ 10,280 thousand higher than the previous year. The
proportion of cash earnings included in sales was 10.4 %
(10.7 %). Higher inventories, lower receivables and an in-
crease in current provisions and liabilities resulted in cash
proceeds of € 7,400 thousand (€ 10,302 thousand).
The cash proceeds from operating activities also include
interest income of € 3,861 thousand (€ 3,342 thousand)
and dividend income of € 90 thousand (€ 1,153 thousand)
as well as interest expense of € 2,453 thousand (€ 1,607
thousand). € 501 thousand (€ 0 thousand) was paid out
for the external financing of pension commitments.
Income tax payments amounted to € 27,384 thousand
(€ 21,324 thousand).
(B) Cash flows from investing activities
A net total of € 59,412 thousand (€ 18,075 thousand)
was required to finance investing activities. An amount of
€ 60,861 thousand (€ 29,144 thousand) was paid for
intangible and tangible assets and an amount of € 166
thousand (€ 6 thousand) for financial assets. There were
total cash receipts of € 1,615 thousand (€ 1,019 thousand)
for disposals of assets.
(C) Cash flows from financing activities
Financing activities resulted in cash outflows of € 9,617
thousand (€ 11,593 thousand). The dividend payments to
shareholders parent and minority related to the dividends
of € 11,220 thousand (€ 9,240 thousand) paid to the share-
holders of KWS SAAT AG, as well as profit distributions
paid to other shareholders at fully consolidated subsidiaries
of € 594 thousand (€ 426 thousand). In addition, borrowings
of € 2,146 thousand (€ –1,927 thousand) were raised.
Assets
Current assets, incl.
prepaid ex penses
(excluding cash and
cash equivalents)
Provisions
Liabilities, incl.
deferred income
Information on acquisitions and disposals of
subsidiaries and other business units
Total amount of all purchase prices
Total amount of sales prices
Total amount of cash components
of purchase prices
Total amount of cash components
of sales prices
Total amount of all cash and cash
equi valents acquired with the com-
panies
Total amount of all cash and cash
equivalents sold with the companies
2008/09
Previo us
year
0
0
0
0
0
0
0
12,025
0
12,025
0
0
Amounts of other assets and liabilities acquired or sold
with the companies
ac q uire d
sold
ac q uire d
sold
2008/09
Previous year
0
0
0
0
0
0
0
0
0
7,393
0
0
0
3,072
1,208
3,009
54
Annual Financial Statements I Cash flow statement I Notes to the cash flow statement I 55
KWS_GB0809_en_Bilanz_RZ_20091112.indd 54-55
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Segment reporting for the KWS Group
Figures in € thousands, unless otherwise specified; previous-year figures in parentheses
In accordance with its internal reporting system, the KWS
Group is primarily organized according to the following
business segments:
• Sugarbeet
• Corn
• Cereals
• Breeding & Services
The research and development function is contained in the
breeding & services segment. Because of their minor im-
portance within the KWS Group, the distribution and pro-
duction of oil and field seed are reported in the cereals and
corn segments, in keeping with the legal entities involved.
Description of segments
Sugarbeet
The results of the multiplication, processing and distribution
activities for sugarbeet seed are reported under the sugar-
beet segment. Under the leadership of KWS SAAT AG,
fourteen foreign subsidiaries and affiliated companies and
one subsidiary in Germany are active in this segment, as in
the previous fiscal year.
Corn
KWS MAIS GMBH is the lead company for the corn seg-
ment. In addition to KWS MAIS GMBH, business activities
are (as in the previous year) conducted by one German
company and fourteen foreign companies of the KWS
Group. The production and distribution activities of this
segment relate to corn for grain and silage corn, and to
oil and field seed.
Cereals
The lead company of this segment, which essentially con-
cerns the production and distribution of hybrid rye, wheat,
and barley, as well as oil and field seed, is KWS LOCHOW
GMBH, an 81 %-owned subsidiary of KWS SAAT AG, with –
as in the previous year – its seven foreign subsidiaries and
affiliated companies in France, Great Britain, and Poland.
Breeding & Services
This segment includes the centrally controlled corporate
functions of research and breeding, as well as services
for the KWS product segments of sugarbeet, corn and
cereals and consulting services for the KWS Group and
other customers.
Considered a core competence for the KWS Group’s entire
product range, plant breeding, including the related bio-
technology research, is largely concentrated at the parent
company in Einbeck. All the breeding material, including
the relevant information and expertise about how to use it,
is owned by KWS SAAT AG with respect to sugarbeet and
corn and by KWS LOCHOW GMBH with respect to cereals.
Research and breeding are also performed by the wholly-
owned German subsidiary PLANTA ANGEWANDTE
PFLANZENGENETIK UND BIOTECHNOLOGIE GMBH,
and breeding activities are conducted – as in the previous
year – by five other German and foreign subsidiaries and
affiliated companies.
Potato activities are pooled in our joint venture VAN RIJN –
KWS B.V. with its four foreign subsidiaries.
Consulting services include the systems business
of KWS SAAT AG and its agricultural operations, KWS
KLOSTERGUT WIEBRECHTSHAUSEN GMBH, KWS
SAATFINANZ GMBH, which mainly handles insurance
for KWS, and EURO-HYBRID GESELLSCHAFT FÜR
GETREIDEZÜCHTUNG MBH.
The other services performed for the KWS product seg-
ments essentially include all the management services of
KWS SAAT AG, such as holding company and administra-
tive functions, including strategic development projects, which
are not directly charged to the product segments or indi-
rectly allocated to them by means of an appropriate formula.
Segment information
Segment sales contains both sales from third parties
(external sales) and sales between the segments (inter-
segment sales). The prices for intersegment sales are
determined on an arm’s-length basis. Uniform royalty
rates per segment are used as the basis for this.
The breeding & services segment generates 84.9 % (93.4 %)
of its sales from the other segments. The sales figure of this
segment represents 3.3 % (1.3 %) of the Group’s external
sales. The corn segment is the largest contributor of external
sales, accounting for 53.1 % (54.9 %) of external sales,
followed by sugarbeet with 31.8 % (32.5 %) and cereals
with 11.8 % (11.3 %).
2008/09
Previo us
year
2008/09
Previo us
year
2008/09
Previo us
year
Segment sales
Internal sales
External sales
228,074
382,546
86,684
154,231
851,535
194,796
329,131
69,401
121,755
715,083
50
1,074
2,380
130,866
134,370
27
212
2,018
113,737
115,994
228,024
381,472
84,304
23,365
194,769
328,919
67,383
8,018
717,165
599,089
Sugarbeet
Corn
Cereals
Breeding & Services
KWS Group
External sales by region
2008/09
Previo us
year
Germany
184,179
151,106
Europe (excluding Germany)
284,660
263,298
65.4 % (69.1 %) of total sales are recorded in Europe
(including Germany).
Americas
Rest of world
KWS Group
220,533
160,342
27,793
24,343
717,165
599,089
2008/09
Previo us
year
2008/09
Previo us
year
2008/09
Previo us
year
Segment
earnings
Depreciation and
amortization
Other noncash items
23,223
25,150
12,032
17,474
77,879
0
28,081
23,230
8,968
9,835
70,114
0
3,735
3,406
3,886
12,281
23,308
0
3,770
2,575
1,529
8,813
25,239
27,900
2,427
1,772
18,119
14,166
285
3,864
16,687
57,338
36,434
0
0
0
77,879
70,114
23,308
16,687
57,338
36,434
Sugarbeet
Corn
Cereals
Breeding & Services
Total segments
Others
KWS Group
The operating income of each segment is reported as the
segment result. The segment results are presented on a
consolidated basis and include all directly attributable
income and expenses. Items that are not directly attribu-
table are allocated to the segments by means of an appro-
priate formula.
56
Annual Financial Statements I Segment reporting I 57
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12.11.09 15:10
Depreciation and amortization charges of € 23,308 thou-
sand (€ 16,687 thousand) allocated to the segments relate
exclusively to intangible assets and property, plant, and
equipment. Goodwill of € 2,009 thousand (€ 0 thousand)
in the cereals segment and of € 1,697 thousand (€ 0 thou-
sand) at the breeding & services segment had to be amortized.
Notes for the KWS Group 2008/2009
Figures in € thousands, unless otherwise specified; previous-year figures in parentheses
2008/09
Previo us
year
2008/09
Previo us
year
Assets
Liabilities
138,329
254,882
35,115
179,693
608,019
147,933
755,952
135,817
217,339
33,376
150,568
537,100
133,998
671,098
53,543
30,553
144,960
119,688
8,791
67,643
8,638
63,957
274,937
222,836
46,529
50,244
321,466
273,080
Investments in long-term assets by segment
Sugarbeet
Corn
Cereals
Breeding & Services
Total segments
Others
KWS Group
The other noncash items recognized in the income
statement relate to noncash changes in the allowances
on inventories and receivables, and in provisions.
2008/09
7,702
17,357
8,878
Previo us
year
4,275
8,293
3,948
27,043
13,865
60,980
30,381
The operating assets of the segments are composed of
intangible assets, property, plant, and equipment, inventories
and all receivables, other assets, and prepaid expenses
that can be charged directly to the segments or indirectly
allocated to them by means of an appropriate formula.
Sugarbeet
Corn
Cereals
Breeding & Services
KWS Group
Cash and cash equivalents and/or current available-
for-sale securities are allocated to the segments only
to the extent that the allocation of operating liabilities
makes it necessary to increase operating assets by a
corresponding amount.
The operating liabilities attributable to the segments include
the borrowings reported on the balance sheet, less provisions
for taxes and the portion of other liabilities that cannot be
charged directly to the segments or indirectly allocated to
them by means of an appropriate formula. Borrowings are
added to operating liabilities only when they exceed the
available cash. Assets or liabilities that have not been allo-
cated to the segments are reported as “Others.”
Capital expenditure on assets was mainly attributable
to the breeding & services segment, where it amounted
to € 27,043 thousand (€ 13,865 thousand), and the
corn segment, where it amounted to € 17,357 thousand
(€ 8,293 thousand). 60 % (32 %) of capital expenditure
was made in Europe (excluding Germany) and 24 % (46 %)
in Germany, mainly in Einbeck.
Investments in long-term assets by region
2008/09
Previo us
year
Germany
14,326
13,885
Europe (excluding Germany)
North and South America
Rest of world
KWS Group
36,710
6,865
3,079
9,579
5,845
1,072
60,980
30,381
Operating assets by region
2008/09
Previo us
year
Germany
229,931
201,714
Europe (excluding Germany)
195,456
185,261
North and South America
169,827
141,148
Rest of world
KWS Group
12,805
8,977
608,019
537,100
The KWS Group (KWS Konzern) is a consolidated group as
defined in the International Financial Reporting Standards
(IFRS) published by the International Accounting Standards
Board (IASB), London, taking into account the interpretations
of the International Financial Reporting Interpretations
Committee (IFRIC) and in addition the commercial law
regulations to be applied pursuant to Section 315a (1) of
the HGB (German Commercial Code). The consolidated
financial statements discharge the obligations of KWS
LOCHOW GMBH, Bergen, and KWS MAIS GMBH, Einbeck,
to produce its own financial statements. The following
standards and interpretations have already been published,
but have not yet been applied: Amendments to IAS 1, 7,
16, 17, 19, 20, 23, 27, 28, 29, 31, 32, 36, 38, 39, 40, 41,
IFRS 1, 2, 3, 5, 7, 8 and IFRIC 12-18. Since these relate
to supplementary disclosure obligations, there will be no
effects on the balance sheet or income statement. The
possible effects of the other changes are currently being
examined. The statements were prepared under the assump-
tion that the operations of the company will be continued.
General disclosures
Companies consolidated in the KWS Group
The consolidated financial statements of the KWS Group
include the single-entity financial statements of KWS SAAT
AG and its subsidiaries in Germany and other countries in
which it directly or indirectly controls more than 50 % of the
voting rights. In addition, joint ventures are proportionately
consolidated, according to the percentage of equity held in
those companies. Subsidiaries and joint ventures that are
considered immaterial for the presentation and evaluation
of the financial position and performance of the Group are
not included.
Consolidation methods
The single-entity financial statements of the individual sub-
sidiaries and joint ventures included in the consolidated
financial statements were uniformly prepared on the basis
of the accounting and measurement methods applied at
KWS SAAT AG; they were audited by independent audi-
tors. For fully or proportionately consolidated units acquired
before July 1, 2003, the Group exercised the option allowed
by IFRS 1 to maintain the consolidation procedures chosen
to date. The goodwill reported in the HGB financial state-
ments as of June 30, 2003 was therefore transferred un-
changed at its carrying amount to the opening IFRS
balance sheet. For acquisitions made after June 30, 2003,
capital consolidation follows the purchase method by allo-
cating the cost of acquisition to the Group’s interest in the
subsidiary’s equity at the time of acquisition. Any excess
of interest in equity over cost is recognized as an asset,
up to the amount by which fair value exceeds the carrying
amount. Any goodwill remaining after first-time consolidation
is recognized under intangible assets.
According to IFRS 3, goodwill is not amortized, but tested
for impairment at least once a year (impairment-only-ap-
proach). Investments in non-consolidated companies are
carried at cost. Goodwill is reported under intangible assets.
Joint ventures are carried according to the percentage of
equity held in the companies concerned using IAS 31.
Subsidiaries and joint ventures are consolidated and asso-
ciated companies measured at equity only if such recog-
nition is considered material for the fair presentation of the
financial position and results of operations of the KWS
Group. As part of the elimination of intra-group balances,
borrowings, receivables, liabilities, and provisions are net-
ted between the consolidated companies. Intercompany
profits not realized at Group level are eliminated from intra-
group transactions. Sales, income, and expenses are netted
between consolidated companies, and intra-group distribu-
tions of profit are eliminated.
Deferred taxes on consolidation transactions recognized in
income are calculated at the tax rate applicable to the com-
pany concerned. These deferred taxes are aggregated with the
deferred taxes recognized in the separate financial statements.
Minority interests are recognized in the amount of the im-
puted percentage of equity in the consolidated companies.
Currency translation
Under IAS 21, the financial statements of the consolidated
foreign subsidiaries and joint ventures that conduct their
business as financially, economically, and organizationally
58
Annual Financial Statements I Segment reporting I Notes I General disclosures I 59
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12.11.09 15:10
independent entities are translated into euros using the
functional currency method as follows:
• Income statement items at the average exchange
rate for the year.
• Balance sheet items at the exchange rate on the
balance sheet date.
The difference resulting from the application of annual
average rates to the net profit for the period in the income
statement is taken directly to equity.
Classification of the balance sheet and the income
statement
The costs for the functions include all directly attributable
costs, including other taxes. Research and development
expenses are reported separately for reasons of transparency.
Research grants are not deducted from the costs to which
they relate, but reported gross under other operating income.
Accounting policies
Consistency of accounting policies
The accounting policies are largely unchanged from the
previous year. All estimates and assessments as part of ac-
counting and measurement are continually reviewed; they are
based on historical patterns and expectations about the future
regarded as reasonable in the particular circumstances.
Goodwill with an indefinite useful life is not amortized, but
tested for impairment at least once a year. The procedure
for the impairment test is explained in the notes to the
balance sheet. Intangible assets acquired as part of busi-
ness combinations are carried separately from goodwill if
they are separable according to the definition in IAS 38 or
result from a contractual or legal right, and fair value can
be reliably measured. Straight-line amortization of these
separated intangible assets is applied over their individual
useful life.
Property, plant, and equipment
Property, plant, and equipment is measured at cost less
straight-line depreciation. A loss is recognized for an im-
pairment expected to be permanent. In addition to directly
attributable costs, the cost of self-produced plant or equip-
ment also includes a proportion of the overheads and
depreciation/amortization, but no finance charges. Depre-
ciation of buildings is based on a useful life of up to 50 years.
The useful lives of technical equipment and machinery range
from 5 to 15 years, and for operating and office equipment
from 3 to 10 years. Low-value assets are fully expensed in
the year of purchase; they are reported as additions and
disposals in the year of purchase in the statement of changes
in noncurrent assets. Impairment losses on property, plant,
and equipment are recognized according to IAS 36 when-
ever the recoverable amount of the assets is less than its
carrying amount. The recoverable amount is the higher of
the asset’s net realizable value and its value in use (value of
future cash flows expected to be derived from the asset).
Intangible assets
Purchased intangible assets are carried at cost less straight-
line amortization over a useful life of three to twenty years.
Impairment losses on intangible assets with finite useful lives
are recognized according to IAS 36.
Financial instruments
Financial instruments are in particular financial assets and
financial liabilities. The financial assets consist primarily of
bank balances and cash on hand, trade receivables,
other receivables, and securities. The credit risk mainly
comprises trade receivables. The amount recognized in
the balance sheet is net of allowances for receivables ex-
pected to be uncollectible, estimated on the basis of his-
torical patterns and the current economic environment.
The credit risk on cash and derivative financial instruments
is limited because they are kept with banks that have
been given a good credit rating by international rating
agencies. There is no significant concentration of credit
risks, because the risks are spread over a large number
of contract partners and customers. The entire credit risk
is limited to the respective carrying amount. Comments
on the risk management system can be found in the
Management Report.
The carrying amount of receivables, fixed-income securities
and cash is assumed as the fair value due to their short
term and the fixed-interest structure of the investments.
Derivative instruments are carried at market values in ac-
cordance with IAS 39 and may have a positive or negative
value. This relates essentially to common deriva-tive finan-
cial instruments that are used to hedge interest rate and
foreign currency risks. In particular, the derivative financial
instruments are measured using recognized mathematical
models, such as present value or Black-Scholes, to calcu-
late option values, taking their volatility, remaining maturity,
and capital market interest rates into account.
Investments are measured at cost. The cost of equity-
accounted investments is increased or decreased by
proportionate changes in equity. Assets available for sale
are carried at market value if this can be reliably measured.
Unrealized gains and losses, including deferred taxes, are
recognized directly in the revaluation reserve under equity.
Permanent impairment losses are recognized immediately
through the income statement. Borrowings are carried at
amortized cost.
The financial liabilities comprise in particular trade payables,
borrowings and other liabilities.
The fair value of financial instruments is determined on the
basis of the market information available on the balance
sheet date and in accordance with the measurement meth-
ods applied.
The other noncurrrent financial assets are essentially
available for sale and are carried at market value where
possible. If a market value cannot be determined, the
amortized costs are carried as an alternative.
The fair value of financial liabilities with a long-term fixed
interest rate is determined as present values of the pay-
ments related to the liabilities, using a yield curve applica-
ble on the balance sheet date.
Subsequent measurement of the financial instruments
depends on their classification in one of the following
categories defined in IAS 39:
• Loans and receivables
This category mainly comprises trade receivables, other
receivables, loans and cash, including fixed-income
short-term securities. Loans are measured at cost. Loans
that carry no interest or only low interest are measured
at their present value. Discernable risks are taken into
account by recognition of an impairment loss. After their
initial recognition, the other financial assets in this category
are measured at amortized cost using the effective interest
method, minus impairments. Receivables that do not
carry any interest or only low interest and with a term of
more than twelve months are discounted. Necessary
value impairments are based on the expected credit risk
60
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• Financial liabilities at fair value
This category covers derivative financial instruments that
have a negative market value and are categorized in
principle as held for trading. Derivatives that are desig-
nated hedging instruments in accordance with IAS 39
are excluded from this provision.
Derivatives
Derivatives cannot be designated as hedging instruments
pursuant to the regulations of IAS 39. They are measured
at their market value. The changes in their market value are
recognized in the income statement. Derivatives are derec-
ognized on their day of settlement.
Inventories and biological assets
Inventories are carried at cost less an allowance for obso-
lescent or slow-moving items. In addition to directly attribu-
table costs, the cost of sales also includes indirect labor
and materials including depreciation under IAS 2. Under
IAS 41, biological assets are measured at the expected
sales proceeds, less costs to sell. The measurement pro-
cedure used is based on standard industry value tables.
Deferred taxes
Deferred taxes are calculated on differences between the
IFRS carrying amounts of assets and liabilities and their tax
base, and on loss carryforwards; they are reported on a
gross basis. Under IAS 12, deferred taxes are calculated
on the basis of the applicable local income tax.
and are carried in separate impairment accounts. Receiv-
ables are derecognized if they are settled or uncollecti-
ble. Other assets are derecognized at the time they are
disposed of or if they have no value.
• Financial assets at fair value
Held-for-trading securities acquired with the intention of
being sold in the short term are assigned to this category.
Derivative financial instruments with a positive market
value are also categorized as held for trading, unless
they are designated hedging instruments in accordance
with IAS 39. They are measured at fair value. Changes
in value are recognized in income. Securities are derec-
ognized after being sold on the settlement date.
• Available-for-sale financial assets
This category covers all financial assets that have not
been assigned to one of the above categories. In princi-
ple, securities are classed as available for sale, unless
a different classification is required due to the fact that
they have an explicit purpose. Equity instruments, such
as shares in (unconsolidated) affiliated companies and
shares held in listed companies, are also included in this
category. In principle, financial instruments in this category
are measured at their fair value in subsequent recognition.
The changes to their fair value in subsequent recognition
are recognized as unrealized gains and losses directly in
equity in the revaluation reserve. The realized gains or
losses are not recognized as profit or loss until they are
disposed of. If there is objective evidence of permanent
impairment on the balance sheet date, the instruments
are written down to the lower value. The amount carried
in the revaluation reserve is derecognized in equity. Any
subsequent decreases in the impairment loss are recog-
nized directly in equity.
• Financial liabilities measured at amortized cost
All financial liabilities, with the exception of derivative
financial instruments, are measured at amortized cost
using the effective interest method. The liabilities are
derecognized at the time they are settled or when the
reason why they were formed no longer exists.
Changes in the companies consolidated at quota relate
to the 50:50 joint venture VAN RIJN – KWS B.V. Poeldijk/
Netherlands and its subsidiaries
• VAN RIJN UK Ltd., Donington/UK (85 %)
• DYNAGRI S.A.R.L., Casablanca/Morocco (75 %)
• VAN RIJN France S.A.R.L., Bazemont/France (70 %)
• VAN RIJN Balcan S.R.L., Vulcan/Romania (67 %)
The four companies of our French joint venture SOCIETE
DE MARTINVAL S.A., which are consolidated at quota,
were reported as a single company in the previous year’s
financial statements.
The financial position and results of operations of propor-
tionately consolidated companies are as follows:
2008/09
Previo us
year
Proportionately consoli-
dated companies
47,458
104,756
25,621
78,696
152,214
104,317
81,313
49,332
4,166
752
66,735
54,233
Noncurrent assets
Current assets
Total assets
Equity
Noncurrent liabilities
Current liabilities
Total equity and liabilities
152,214
104,317
Net sales
164,519
126,775
Net profit for the year
13,799
7,966
Provisions for pensions and other employee benefits
Under IAS 19, obligations from direct pension commit-
ments are measured using actuarial principles under the
accrued benefit valuation method. Gains or losses from
unplanned changes in accrued benefits and from changes
in actuarial assumptions are disregarded if the change
moves within a 10 % corridor of the accrued benefits. Only
if the gains or losses exceed this threshold will they be
recognized as income and distributed over the remaining
working lives and included in the provision.
Other provisions
Tax and other provisions account for all discernible risks
and contingent liabilities. Depending on circumstances,
they are measured at the most probable amount or at
the expected value.
Contingent liabilities
The contingent liabilities correspond to the obligation
for loan amounts drawn down by third parties as of the
balance sheet date.
Consolidated group and changes in the
consolidated group
Number of companies including KWS SAAT AG
D o m estic
F oreig n
Total
D o m estic
F oreig n
Total
06/30/2009
Previous year
Consolidated
11
31
42
11
31
42
Consolidated
at quota
Total
0
11
12
43
12
54
0
11
7
38
7
49
The companies are listed under item number (31).
62
Annual Financial Statements I Notes I Notes to the balance sheet I 63
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12.11.09 15:10
Notes to the Balance Sheet
Figures in € thousands, unless otherwise specified; previous-year figures in parentheses
(1) Assets
The statement of changes in noncurrent assets contains a
breakdown of assets summarized in the balance sheet and
shows how they changed in 2008/09. Capital expenditure
on assets was € 61,146 thousand (€ 30,387 thousand).
The Management Report describes the significant addi-
tions to assets. Depreciation and amortization amounted
to € 23,308 thousand (€ 16,992 thousand).
The recoverable amount is the higher of the entity’s net
realizable value and its value in use (value of future cash
flows expected to be derived from the entity). The impair-
ment test uses the expected future cash flows on which
the medium-term plans of the companies are based; these
plans, which cover a period of four years, have been ap-
proved by the Executive Board. They are based on historical
patterns and expectations about future market development.
(2) Intangible assets
This item includes purchased varieties, rights to varieties
and distribution rights, software licenses for electronic data
processing, and goodwill. Additions to intangible assets
amounting to € 1,439 thousand (€ 2,476 thousand) relate
primarily to the acquisition of software licenses and – to an
amount of € 17,702 thousand – to our investment in the joint
venture VAN RIJN – KWS B.V., as part of which protected
potato varieties and a customer base were obtained in par-
ticular. Amortization of intangible assets amounted to € 6,693
thousand (€ 1,873 thousand); this charge is included in the
relevant functional costs and the other operating expenses,
depending on the operational use of the intangible assets.
The goodwill recognized as an asset relates mainly to the
company AGRELIANT GENETICS LLC. – amounting to
€ 16,532 thousand (€ 15,595 thousand) – in the corn
segment, the company KWS UK LTD. – amounting to
€ 1,693 thousand (€ 1,693 thousand) – in the cereals seg-
ment and the new joint venture VAN RIJN – KWS B.V. –
amounting to € 3,187 thousand (€ 0 thousand) – in the
services & breeding segment.
In order to meet the requirements of IFRS 3 in combination
with IAS 36 and to determine any impairment of goodwill,
cash-generating units have been defined in line with internal
reporting guidelines. In the KWS Group, these units are the
legal entities. To test for impairment, the carrying amount of
each entity is determined by allocating the assets and liabili-
ties, including attributable goodwill and intangible assets.
An impairment loss is recognized if the recoverable amount
of an entity is less than its carrying amount.
For the European and American markets, the key assump-
tions on which corporate planning is based include as-
sumptions about price trends for seed, in addition to the
development of market shares and the regulatory frame-
work. Company-internal projections take the assumptions
of industry-specific market analyses and company-related
growth perspectives into account.
A standard discount rate of 7.6 % (8.0 %) has been assumed
to calculate present values. A growth rate of 1.5 % (1.5 %)
has been assumed beyond the detailed planning horizon
in order to allow for extrapolation in line with the expected
inflation rate. Tests provided evidence that the goodwill
recognized in the consolidated balance sheet and deter-
mined for the cash-generating units is not impaired. Amor-
tization totaling € 3,706 thousand (€ 0 thousand) has to be
carried in the other operating expenses since the earnings
prospects of our 49 %-owned joint ventures SOCIETÉ DE
MARTINVAL S.A. diminished as a result of the difficult cli-
mate in the cereals market in France.
(3) Property, plant, and equipment
Capital expenditure amounted to € 41,839 thousand
(€ 27,905 thousand) and depreciation amounted to
€ 16,615 thousand (€ 14,814 thousand). The Management
Report describes the significant capital expenditure.
(4) Financial assets
Investments in non-consolidated subsidiaries and shares
in cooperatives and GmbHs that are of minor significance,
with an amortized cost totaling € 982 thousand (€ 988
thousand), are reported in this account since a market
value cannot be reliably determined. The mutual invest-
ment in our French partner RAGT SEMENCES S.A. of
€ 4,000 thousand was taken back to equity in the year
under review with the exercise of existing put and call
options. Listed shares are carried at market value of € 86
thousand (€ 68 thousand). This account also includes in-
terest-bearing homebuilding loans to employees and
other interest-bearing loans totaling € 526 thousand (€ 475
thousand). In addition, the balance of € 1,654 thousand
after netting off benefit obligations and planned assets
is carried. Amortization of financial assets amounted to
€ 0 thousand (€ 305 thousand).
06/30/2009
Previo us
year
Raw materials and consumables
26,713
15,290
Work in process
30,469
26,518
Immature biological assets
6,337
7,348
Finished goods
58,014
36,673
121,533
85,829
(8) Current receivables
06/30/2009
Previo us
year
216,868
224,163
15,493
7,113
21,280
19,934
253,641
251,210
(5) Noncurrent tax receivables
This relates to the present value of the corporate income
tax credit balance, which was last determined at December
31, 2006, and has been paid in 10 equal annual amounts
since September 30, 2008.
Trade receivables
Current tax assets
Other current assets
Trade receivables amounted to € 216,868 thousand, a de-
crease of 3.3 % from the figure of € 224,163 thousand for
the previous year; this amount includes € 948 thousand
(€ 309 thousand) receivables from related parties. The item
“Other current assets” includes prepaid expenses totaling
€ 3,941 thousand (€ 3,779) thousand in addition to other
receivables of € 17,312 thousand (€ 16,135 thousand).
(6) Deferred tax assets
Under IAS 12, deferred tax assets are calculated as the
difference between the IFRS balance sheet amount and
the tax base. They are reported on a gross basis and total
€ 16,922 thousand (€ 16,858 thousand), of which € 1,734
thousand (€ 2,290 thousand) will be carried forward for the
future use of tax losses.
(7) Inventories and biological assets
Inventories increased by € 35,704 thousand, or 41.6 %,
net of writedowns totaling € 44,095 thousand (€ 30,262
thousand). Immature biological assets relate to living plants
in the process of growing (before harvest). The field inven-
tories of the previous year were harvested in full and the
fields were newly tilled in the year under review. Public sub-
sidies of € 1,533 thousand (€ 1,363 thousand), for which
all the requirements were met at the balance sheet date,
were granted for the total area under cultivation of 4,082
(4,289) ha and were recognized in income. Future subsi-
dies depend on the further development of European agri-
cultural policy.
64
Annual Financial Statements I Notes I Notes to the balance sheet I 65
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12.11.09 15:10
≤ 60 d ays
61–120 d ays
121–180 d ays
> 180 d ays
06/30/2009
Trade receivables
Other receivables
06/30/2008
Trade receivables
Other receivables
Carrying
amount
216,868
17,313
234,181
224,163
16,135
240,298
Of which: neither
written down nor
overdue on the
balance sheet
date
Of which: not written down on the
balance sheet date and overdue in the
following time frames
Of which: written
down and not
overdue on the
balance sheet
date
176,946
23,085
15,288
1,287
192,234
24,372
4,995
272
5,267
1,032
2,882
0
12
1,032
2,894
181,535
16,141
6,986
1,390
16,131
0
0
0
197,666
16,141
6,986
1,390
0
4
4
3,004
343
3,347
10,885
0
10,885
(9) Securities
Securities amounting to € 14,116 thousand (€ 17,958 thou-
sand) relate primarily to short-term liabilities securities and
fund shares.
(10) Cash
Cash of € 111,515 thousand (€ 94,973 thousand) consists
of balances with banks and cash on hand. The cash flow
statement explains the change in this item compared with
the previous year, together with the change in securities.
(11) Equity
The fully paid-up subscribed capital of KWS SAAT AG is
still € 19,800,000.00. The no-par bearer shares are certif-
icated by a global certificate for 6,600,000 shares. The
company does not hold any shares on its own. Equity
(including minority interest) increased by € 36,468 thou-
sand, from € 398,018 thousand to € 434,486 thousand.
For details, see the statement of changes in equity.
The already overdue trade receivables that have not been
written down fully amount to € 4,924 thousand (€ 7,226
thousand). There are insignificant trade receivables for which
contractual conditions were changed in the year under
review and that otherwise would have been written down
or overdue.
There are no indications on the balance sheet date that
customers who owe trade receivables that have not been
written down and are not overdue will not meet their pay-
ment obligations.
The following allowances have mainly been made for possible
risks of non-payment of trade receivables:
Allowances for receivables
07/01
A d ditio n
Disp osal
R eversal
06/30
2008/09
14,358
8,868
538
1,376
21,312
2007/08
19,707
2,499
3,923
3,925
14,358
Current financing receivables include an amount of € 1
thousand (€ 68 thousand) receivable from related parties.
Current receivables include an amount of € 1,128 thousand
(€ 124 thousand) due after more than one year.
(12) Noncurrent liabilities
The trade payables are due for payment in between 1 and
5 years and the due dates for the other long-term liabilities
extend through 2017.
06/30/2009
Previo us
year
Long-term provisions
62,037
60,872
Long-term financial borrowings
Trade payables
1,926
6,429
2,629
1,983
Deferred tax liabilities
18,075
13,815
Other long-term liabilities
10,274
11,259
98,741
90,558
Long-term provisions
Pension provisions
Other provisions
07/01/2008
C han g es in
the c o nsol.
currency
gro u p,
56,280
4,592
60,872
1,577
117
1,694
A d ditio n
4,329
638
4,967
C o nsu m ptio n
5,228
221
5,449
R eversal
22
25
47
06/30/2009
56,936
5,101
62,037
Retirement benefits are based on defined benefit obliga-
tions, determined by years of service and pensionable
compensation.
The discount rate was 5.80 %, compared with 6.40 %
the year before.
Pension provisions are measured using the accrued benefit
method under IAS 19, on the basis of assumptions about
future development. The assumptions in detail are that wages
and salaries will increase by 2.80 % (2.80 %) annually and
pensions by 2.00 % (2.00 %) annually.
No income or expenses were recognized as a result of
changes in retirement obligations or benefits payable or
from the adjustment to assumptions. For benefit obligations
backed by a guarantee by an insurance company, the
planned assets of € 7,728 thousand (€ 7,416 thousand)
correspond to the present value of the obligation. Pension
funds were invested in to cover foreign pension commitments.
The accrued benefit is reconciled to the provisions reported in the consolidated financial
statements as follows:
Accrued benefit entitlements at beginning of fiscal year
Cost of additional benefit entitlements
Interest expenses on benefit entitlements acquired in previous years
Changes in consolidated group and currency
Changes in actuarial gains/losses
Pension payments
Accrued benefit entitlements at end of fiscal year
Present value of planned assets
Planned assets carried as assets
Actuarial gains/losses not included
Pension provisions at end of fiscal year
2008/09
Previo us
year
68,372
73,207
997
3,315
93
3,725
5,402
1,744
3,213
126
– 5,711
4,207
71,100
68,372
12,948
13,577
1,654
0
– 2,870
1,485
56,936
56,280
66
Annual Financial Statements I Notes I Notes to the balance sheet I 67
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12.11.09 15:10
The planned assets changed as follows during the fiscal year:
Present value of planned assets at the start of the fiscal year
Expected gains from planned assets
Changes in actuarial gains/losses
Employer's contribution to external social security bodies
Payments from external social security bodies
Currency difference from foreign planned assets
2008/09
Previo us
year
13,577
14,086
890
– 1,136
1,168
753
– 798
866
– 770
0
605
0
Present value of planned assets at the end of the fiscal year
12,948
13,577
The pension obligations and planned assets have changed over time as follows:
Accrued benefit entitlements on 6/30
Planned assets on 6/30
Shortage (+) / surplus (-)
Historical gains (+) / losses (-) from pension commitments
Historical gains (+) / losses (-) from planned assets
2008/09
2007/08
2006/07
71,100
12,948
58,152
68,372
61,718
13,577
8,174
54,795
53,544
201
1,042
– 1,551
– 1,028
682
0
The table below shows of breakdown of the pension costs for the defined benefit obligations:
Costs for additional benefit entitlements
Interest expense
Anticipated income from the planned assets
Pension costs
2008/09
Previo us
year
997
4,240
– 924
4,313
1,744
4,052
– 839
4,957
On July 1, 2008, a company agreement relating to reorgan-
ization of the company retirement pension program for
KWS SAAT AG and German subsidiaries was concluded.
As part of this, subsequent benefits will be provided by a
provident fund backed by a guarantee and based on a
defined contribution plan. The costs for contribution to this
pension scheme were € 501 thousand (€ 0 thousand).
The return and income from the planned assets depend
on the reinsurance policy, which yields guaranteed in-
terest of 2.25 %. For the next year, income totaling € 550
thousand is expected.
In addition, the benefit obligation from salary conversion
was backed by a guarantee that exactly matches the present
value of the obligation of € 3,976 thousand (€ 3,744 thou-
sand) (defined contribution plan).
The long-term financial borrowings include loans from
banks amounting to € 1,926 thousand (€ 2,629 thousand).
They have remaining maturities through 2017.
Under IAS 12, deferred tax liabilities are calculated as the
difference between the IFRS balance sheet amount and
the tax base. They are reported on a gross basis and total
€ 18,075 thousand (€ 13,815 thousand).
(13) Current liabilities
Short-term provisions
Current liabilities to banks
Current liabilities to affiliates
Other current financial liabilities
Short-term borrowings
Trade payables to affiliates
Other trade payables
Trade payables
Tax liabilities
Other liabilities
06/30/2009
Previo us
year
112,696
88,238
6,367
2,784
255
69
65
993
6,691
3,842
67
0
55,085
36,863
55,152
36,863
18,251
22,639
29,935
30,940
222,725
182,522
Short-term liabilities increased by a total of € 40,203 thousand to € 222,725 thousand and are due in less than one year.
Short-term provisions
Obligations from
sales transaction
Obligations from
purchase transaction
Other obligations
07/01/2008
C han g es in
the c o nsol.
currency
gro u p,
A d ditio n
C o nsu m ptio n
R eversal
06/30/2009
68,672
6,390
89,228
71,646
4,119
88,525
5,619
13,947
88,238
0
0
1,425
17,517
2,236
9,289
6,390
108,170
83,171
2,478
334
6,931
2,330
21,841
112,696
The tax liabilities of € 18,251 thousand (€ 22,639 thousand) include amounts for the year under review and the period not
yet concluded by the external tax audit.
(14) Derivative instruments
N o minal
v olu m e
C arryin g
a m o u nts
M arket
v alues
06/30/2009
Currency hedges
Interest-rate hedges
Commodity hedges
28,735
39,000
4,558
393
– 230
393
– 230
0
0
Of the currency hedges, € 596 thousand have remaining
maturities of more than one year. Of the interest-rate deriv-
atives, hedges with a nominal volume of € 9,000 thousand
will mature within one to five years. Transactions with a vol-
ume of € 20,000 thousand have remaining maturities of
more than 5 years. The commodity hedges have remaining
maturities of less than one year.
68
Annual Financial Statements I Notes I Notes to the balance sheet I 69
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12.11.09 15:10
(15) Financial instruments
The table below presents the net gains/losses carried in the income statement for financial instruments in each
measurement category.
Available-for-sale financial assets
Financial assets at fair value
Loans and receivables
Financial liabilities measured at amortized cost
Financial liabilities at fair value
2008/09
183
246
Previo us
year
6,626
29
– 3,795
5,783
– 2,546
– 1,707
2,823
– 3,575
The net income from financial assets includes income and
expenses from financial assets and also the income from
disposal of the associated companies in the previous year.
The net gain/loss from loans and receivables primarily in-
cludes effects from changes in the allowances for impair-
ment. The net gains/losses from financial assets at fair
value and financial liabilities at fair value mainly include
changes in the market value of derivative financial instru-
ments. The net losses from financial liabilities measured
at amortized cost largely consist of interest expense.
Interest income from financial assets that are not mea-
sured at fair value and recognized in the income state-
ment was € 3,742 thousand (€ 3,424 thousand). Interest
expenses for financial borrowings were € 2,545 thousand
(€ 1,759 thousand).
In order to assess the risk of exchange rate changes, the
sensitivity of a currency to fluctuations was determined.
After the euro, the US dollar is the most important currency
in the KWS Group. All other currencies are of minor impor-
tance. The average exchange rate in the fiscal year was
1.37 USD/€.
If the US dollar depreciated by 10 %, net sales would de-
cline by around 3 % and operating income likewise by
around 4 %. If the US dollar appreciated by 10 %, net sales
would rise by 3 % and income by 4 %. Equity would change
by up to € 2.0 million in the event of such a change in the
exchange rate.
In order to assess the risk of interest rate changes, the
sensitivity of interest rates to fluctuations was determined.
The average rate of interest in the fiscal year was 3.3 %.
An increase of 1 percentage point in the rate of interest
would add a further € 0.4 million to the interest result; a
reduction of 1 percentage point would reduce it by € 0.4
million. Equity would change by up to € 0.3 million in the
event of such a change in the rate of interest.
In order to assess the risk of changes in commodity prices,
the sensitivity of commodity prices to fluctuations was de-
termined. A 10 % increase in commodity prices would in-
crease the cost of sales by around 4 %; a decrease would
reduce it by around 4 %. Equity would change by around € 11
million in the event of such a change in commodity prices.
The carrying amounts and fair values of the financial instruments are as follows:
receiva bles
L o ans an d
Financial assets
at fair value
A vaila ble-for-sale
financial assets
Total carryin g
a m o u nt
Financial instruments
Fair values
Carrying amounts
3,248
216,868
14,116
111,515
21,280
(729)
0
216,868
14,116
111,515
20,551
(0)
0
0
0
0
729
(729)
729
3,248
0
0
0
0
(0)
3,248
3,248
216,868
14,116
111,515
21,280
(729)
367,027
06/30/2009
Financial assets
Financial assets
Trade receivables
Securities
Cash and cash equivalents
Other current assets
Of which derivative financial instruments
Total
367,027
363,050
Financial lia bilities
a m ortize d c ost
m easure d at
Financial lia bilities
at fair value
Total carryin g
a m o u nt
Financial instruments
Fair values
Carrying amounts
1,926
6,429
10,274
6,691
55,152
29,935
(1,761)
1,926
6,429
10,274
6,691
55,152
28,174
(0)
0
0
0
0
0
1,761
(1,761)
1,761
1,926
6,429
10,274
6,691
55,152
29,935
(1,761)
110,407
06/30/2009
Financial liabilities
Long-term borrowings
Long-term trade payables
Other noncurrent liabilities
Short-term borrowings
Short-term trade payables
Other liabilities
Of which derivative financial instruments
Total
110,407
108,646
70
Annual Financial Statements I Notes I Notes to the balance sheet I 71
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12.11.09 15:10
receiva bles
L o ans an d
Financial assets
at fair value
A vaila ble-for-sale
financial assets
Total carryin g
a m o u nt
Financial instruments
Fair values
Carrying amounts
5,531
0
224,163
224,163
17,958
94,973
19,934
(601)
17,958
94,973
19,333
(0)
0
0
0
0
601
(601)
601
5,531
0
0
0
0
(0)
5,531
Previous year
Financial assets
Financial assets
Trade receivables
Securities
Cash and cash equivalents
Other current assets
Of which derivative financial instruments
Total per category
362,559
356,427
Financial lia bilities
a m ortize d c ost
m easure d at
Financial lia bilities
at fair value
Financial instruments
Previous year
Financial liabilities
Long-term borrowings
Long-term trade payables
Other noncurrent liabilities
Short-term borrowings
Short-term trade payables
Other liabilities
Of which derivative financial instruments
Total per category
Fair values
Carrying amounts
2,491
1,983
11,259
3,842
36,863
30,940
(1,761)
87,378
2,629
1,983
11,259
3,842
36,863
29,179
(0)
85,755
0
0
0
0
0
1,761
(1,761)
1,761
None of the reported financial instruments will be held until it finally matures.
5,531
224,163
17,958
94,973
19,934
(601)
362,559
Total carryin g
a m o u nt
2,629
1,983
11,259
3,842
36,863
30,940
(1,761)
87,516
(16) Contingent liabilities
As in the previous year, there are no contingent liabilities
to report.
(17) Other financial obligations
There was a € 6,120 thousand (€ 3,961 thousand) obligation
from uncompleted capital expenditure projects. The leases
relate primarily to full-service agreements for IT equipment
and fleet vehicles, which also include services for which a
total of € 1,932 thousand (€ 1,769 thousand) was paid in the
year under review. The main leasehold obligations relate to
land under cultivation.
Obligations under rental
agreements and leases
Due next year
Due in 2 to 5 years
Due after 5 years
06/30/2009
6,599
7,382
1,596
Previo us
year
6,065
8,055
2,266
15,577
16,386
Notes to the income statement
Figures in € thousands, unless otherwise specified; previous-year figures in parentheses
Income statement for the period July 1, 2008, through June 30, 2009
Net sales
Cost of sales
Gross profit on sales
Selling expenses
Research and development expenses
General and administrative expenses
Other operating income
Other operating expenses
Operating income
Net financial income/expenses
Result of ordinary activities
Income taxes
Net income for the year
Shares of minority interest
Net income after minority interest
€ millio ns
% of sales
€ millio ns
% of sales
2008/09
Previous year
717.2
381.0
336.2
115.0
89.5
46.3
31.9
39.4
77.9
– 2.7
75.2
25.1
50.1
4.0
46.1
100.0
53.1
46.9
16.0
12.5
6.5
4.5
5.5
10.9
– 0.4
10.5
3.5
7.0
0.6
6.4
599.1
305.4
293.7
106.1
80.6
42.3
24.3
18.9
70.1
5.3
75.4
20.8
54.6
3.5
51.1
100.0
51.0
49.0
17.7
13.5
7.1
4.2
3.2
11.7
0.9
12.6
3.5
9.1
0.6
8.5
(18) Net sales
By product category
2008/09
Previo us
year
Certified seed sales
650,855
545,063
Royalties income
Basic seed sales
Services fee income
Other sales
By region
Germany
Europe
Americas
Rest of world
33,988
11,001
4,085
30,267
6,898
3,082
17,236
13,779
717,165
599,089
184,179
151,106
284,660
263,298
220,533
160,342
27,793
24,343
717,165
599,089
For further details of sales, see segment reporting.
Sales are recognized when the agreed goods or services
have been supplied and risk and title pass to the buyer.
Any rebates or discounts are taken into account.
The cost of sales increased by € 75,629 thousand to
€ 381,052 thousand, or 53.1 % (51.0 %) of sales.
The total cost of goods sold was € 198,358 thousand
(€ 170,325 thousand).
Allowances on inventories totaling € 13,834 thousand more
than the previous year’s € –1,929 thousand, were required.
They were charged to segment results as follows: charged
to sugarbeet € 6,046 thousand (€ –2,821 thousand), to corn
€ 6,022 thousand (€ 952 thousand), to cereals € 1,664
thousand (€ –148 thousand) and to breeding & services
€ 102 thousand (€ 88 thousand).
The € 8,865 thousand increase in selling expenses to
€ 114,961 thousand is mainly due to expanded activities in the
North America and Southern/Southeastern Europe regions.
This is 16.0 % of sales, down from 17.7 % the year before.
72
Annual Financial Statements I Notes I Notes to the balance sheet I Notes to the income statement I 73
KWS_GB0809_en_Bilanz_RZ_20091112.indd 72-73
12.11.09 15:10
Research and development is recognized as an expense
in the year it is incurred; in the year under review, this
amounted to € 89,456 thousand (€ 80,576 thousand the
year before). Development costs for new varieties are not
recognized as an asset because evidence of future econom-
ic benefit can only be provided after the variety has been
officially certified.
General and administrative expenses increased by
€ 4,034 thousand to € 46,291 thousand, representing
6.5 % of sales, after 7.1 % the year before.
Legal form expenses
Allowances on receivables
Counterparty default
Exchange rate losses and losses on
currency and interest rate hedges
Losses from sales of fixed assets
Expenses relating to previous periods
Amortization on goodwill
Other expenses
2008/09
Previo us
year
873
843
8,868
2,499
673
302
14,449
10,781
243
668
129
1,349
3,706
0
9,966
2,987
39,446
18,890
(19) Other operating income
2008/09
Previo us
year
Income from sales of fixed assets
630
401
(21) Net financial income/expenses
Income from the reversal
of provisions
6,062
3,133
Exchange rate gains and gains from
currency and interest rate hedges
7,888
6,240
Income from recoveries on
receivables written off
Income from reversal of allowances
of receivables
Grants
Income relating to previous periods
2,400
Income from cost allocations
0
20
23
1,376
4,936
3,925
1,620
658
174
Interest income
Interest expenses
Income from securities
Income from other financial assets
Interest expenses on donation of
pension provisions
Interest expense for other
long-term provisions
Income from loss
compensation received
Miscellaneous other
operating income
190
88
Interest expense for finance leasing
8,418
8,005
31,920
24,267
Net interest expense
– 2,905
– 1,374
Profit from affiliated companies
0
5,779
Income from foreign exchange transactions, reversals of
provisions and allowances for receivables that were no
longer required together with book profits from disposals
of property, plant and equipment and grants received,
resulted in other operating income totaling € 31,920 thou-
sand, compared with € 24,267 thousand the year before.
(20) Other operating expenses
The other operating expenses are indicative of the effects
of the financial crisis, in particular the greater risk of counter-
party defaults and higher costs of currency and interest
rate hedges. Of the additional allowances for receivables,
€ 5,398 thousand (€ 1,004 thousand) was charged to the
corn segment, € 279 thousand (€ 27 thousand) to the ce-
reals segment and € 3,191 thousand (€ 1,468 thousand) to
the sugarbeet segment.
Net income from subsidiaries
and joint ventures
Net income from participations
Depreciations of subsidiaries
Net income from equity
investments
Net financial income/expenses
– 2,722
The net financial result fell by a total € 7,975 thousand to
€ – 2,722 thousand. Net interest expense was € –2,905
thousand (€ –1,374 thousand), whereas net income from
equity investments, which contained the profits from dis-
posals of associated companies in the previous year, fell by
€ 6,444 thousand to € 183 thousand.
2008/09
Previo us
year
3,565
3,026
0
100
3,589
1,707
45
131
3,315
3,213
166
63
167
52
83
1,147
100
0
183
6
305
6,627
5,253
(22) Income taxes
Income tax expense is computed as follows:
2008/09
Previo us
year
Income taxes, Germany
Income taxes, other countries
8,583
15,323
10,141
14,671
Current expenses
from income taxes
23,909
24,812
Thereof from previous years
(118)
(1,483)
Deferred taxes, Germany
68
465
Deferred taxes, other countries
Deferred tax income/expense
1,081
1,149
– 4,461
– 3,996
Reported income tax
expense
25,055
20,816
The “Law on Tax Measures Accompanying Introduction of
the Societas Europaea and Amending Further Tax Regula-
tions” (SEStEG), which was passed at the end of 2006,
means that the corporate income tax credit balance at
December 31, 2006, can be realized. It will be paid out in
ten equal annual amounts from 2008 to 2017. The German
Group companies carried these claims as assets at their
present value totaling € 7,279 thousand (€ 7,182 thousand)
at June 30, 2009. € 901 thousand was recovered in the
year under review and recognized directly in equity.
Under German tax law, both German and foreign dividends
are 95 % tax exempt.
Adjusted for tax relating to previous periods, KWS pays tax
in Germany at a rate of 29.1 %. Corporate income tax of
15.0 % (15.0 %) and solidarity tax of 5.5 % (5.5 %) are applied
uniformly to distributed and retained profits. In addition,
municipal trade income tax is payable on profits generated
in Germany. Trade income tax is applied at a weighted
average rate of 13.3 % (13.3 %), resulting in a total tax rate
of 29.1 % (29.1 %).
The profits generated by Group companies outside Ger-
many are taxed at the rates applicable in the country in
which they are based.
For the German Group companies, deferred tax was cal-
culated at 29.1 % (29.1 %). For foreign Group companies,
deferred tax was calculated using the tax rates applicable
in the country in which they are based.
Deferred taxes are calculated on the basis of the following temporary differences between the carrying amount of an asset
or liability in the balance sheet and its tax base:
2008/09
Previo us
year
C han g e
2008/09
Previo us
year
C han g e
Deferred
tax assets
Deferred
tax liabilities
Intangible assets
Property, plant and equipment
Financial assets
Inventories
Current assets
Noncurrent
liabilities
Current liabilities
Tax loss carryforward
Other consolidation transactions
Deferred taxes recognized
4
67
8
68
– 4
– 1
6,857
4,151
2,706
4,626
4,933
1,751
2,696
– 307
– 945
4,010
425
3,585
11,342
11,086
256
0
0
498
– 274
0
224
1,799
1,355
444
407
369
38
1,082
2,091
– 1,009
1,734
2,290
– 556
394
252
142
567
128
0
5
235
197
0
19
332
– 69
0
– 14
16,922
16,858
64
18,075
13,815
4,260
74
Annual Financial Statements I Notes I Notes to the income statement I 75
KWS_GB0809_en_Bilanz_RZ_20091112.indd 74-75
12.11.09 15:10
In the year under review, deferred taxes of € 3,047 thou-
sand (€ 446 thousand), mainly resulting from loss carryfor-
wards and intangible assets, were directly credited to equity,
without recognition in profit or loss. Tax loss carryforwards
of € 4,509 thousand (€ 4,058 thousand) were regarded
as not being able to be utilized, with the result that no de-
ferred tax assets were able to be recognized as an asset
for them. The anticipated taxable profits projected in the
medium-term plans of the companies were used for this in
principle; these plans, which cover a period of four years,
have been approved by the Executive Board. They are
based on historical patterns and expectations about future
market development.
The following schedule reconciles the expected income
tax expense to the reported income tax expense. The cal-
culation assumes an expected tax expense, applying the
German tax rate to the profit before tax of the entire Group:
2008/09
Previo us
year
Earnings before income taxes
75,157
75,367
Expected income tax expense *
21,871
21,932
Difference in income tax liability
outside Germany
Tax portion for:
Tax-free income
Expenses not deductible
for tax purposes
Temporary differences and
losses for which no deferred
taxes have been recognized
Tax credits
Taxes relating to previous years
Other tax effects
1,216
– 416
– 16
– 1,768
1,913
1,850
131
– 1,916
– 418
– 356
118
240
1,483
7
Reported income tax expense
25,055
20,816
Effective tax rate
33.3 %
27.6 %
* Tax rate in Germany 29.1 (29.1) %
Other taxes, primarily real estate tax, are allocated to the
relevant functions.
(23) Personnel costs/employees
2008/09
Previo us
year
Wages and salaries
108,333
93,705
Social security contributions,
expenses for pension plans
and benefits
26,685
25,298
135,018
119,003
Personnel costs went up by € 16,015 thousand to
€ 135,018 thousand, an increase of 13.5 %. The number
of employees (including trainees and interns) increased
by 359 (or + 12.6 %) to 3,215.
Compensation increased by 15.6 % to € 108,333 thousand.
Social security contributions, expenses for pension plans and
benefits were € 1,387 thousand higher than in the previous
year. An amount of € 8,282 thousand (€ 6,074 thousand)
was recognized as an expense for defined contribution plans,
including state pension insurance, in the year under review.
Employees*
Germany
Rest of Europe (without Germany)
Americas
Rest of world
Total
* Annual average
2008/09
Previo us
year
1,357
1,260
782
1,002
74
670
872
54
3,215
2,856
Of the above number, 630 (528) employees are included
according to the percentage of equity held in the compa-
nies that employ them. 1,262 (1,057) employees are em-
ployed by now 12 proportionately consolidated investees.
If these persons are included in full, the workforce total is
3,848 (3,385). The reported number of employees is greatly
influenced by seasonal labor.
(27) Audit of the annual financial statements
On December 16, 2008, the Annual Shareholders’ Meeting
of KWS SAAT AG appointed the accounting firm Deloitte &
Touche GmbH, Hanover, as the Group’s auditors for fiscal
year 2008/09.
Fee paid to the external auditors under
Section 314 sentence 1 no. 9 of the HGB
a) Audit of the consolidated
financial statements
b) Certification and valuation services
c) Tax consulting
d) Other services
Total fee paid
2008/09
583
29
18
35
665
For fiscal year 2009/10, fees for consulting services (exclud-
ing auditing) of up to € 100 thousand are expected.
(28) Declaration of compliance with the German
Corporate Governance Code
KWS SAAT AG has issued the declaration of compliance
with the German Corporate Governance Code required by
Section 161 of the Aktiengesetz (AktG – German Stock
Corporation Act) and made it accessible to its shareholders.
(29) Related party disclosures
As part of its operations, KWS procures goods and ser-
vices worldwide from a large number of business partners,
including companies in which KWS has an interest. Busi-
ness dealings with these companies are always conducted
on an arm’s length basis; from the KWS Group’s perspective,
these dealings have not been material. As part of Group
financing, short- and medium-term loans are taken out from
and granted to subsidiaries at market interest rates. A total
of 14 shareholders declared to KWS SAAT AG in 2002 that
as a result of mutual allocations, they respectively hold more
than 50 % of the voting rights. No other related parties have
been identified for whom there is a special reporting require-
ment under IAS 24.
(24) Net income for the year
Net income for the year fell by € 4,449 thousand to € 50,102
thousand, representing a return on sales of 7.0 %, down
from 9.1 % in the previous year. The net profit for the period
after minority interest is € 46,095 thousand, and € 6.98
(€ 7.74) for each of the 6,600,000 shares on issue. The ob-
jective of KWS’ capital management activities is to pursue
the interests of shareholders, employees and other stake-
holders in accordance with the corporate strategy. The div-
idend distributed is geared to the earnings strength of the
KWS Group in order to ensure adequate internal financing
of further business expansion in the long term. The equity
ratio is currently 57.5 %, following 59.3 % in the previous year.
(25) Total remuneration of the Supervisory Board and
Executive Board and of former members of the Super-
visory Board and Executive Board of KWS SAAT AG
The members of the Supervisory Board receive fixed
compensation and variable compensation based on the
dividend paid. Providing that the annual meeting of share-
holders resolves the proposed dividend, total compensation
of the members of the Supervisory Board will be € 360
thousand (€ 333 thousand), excluding value-added tax.
€ 288 thousand (€ 263 thousand) of the total compen-
sation is performance-related.
In fiscal year 2008/09, total Executive Board compensation
amounted to € 2,787 thousand (€ 3,212 thousand). Varia-
ble compensation of € 1,970 thousand (€ 2,261 thousand),
calculated on the basis of the net profit for the period of
the KWS Group, includes compensation of € 33 thousand
(€ 37 thousand) for duties performed in subsidiaries. The
fixed compensation includes not only the agreed salaries, but
also non-monetary compensation granted by KWS SAAT AG.
Compensation of former members of the Executive Board
and their surviving dependents amounted to € 1,029 thou-
sand (€ 883 thousand). Pension provisions recognized
for this group of persons amounted to € 2,414 thousand
(€ 2,745 thousand) as of June 30, 2009.
(26) Shareholdings of members of the Supervisory
Board and Executive Board (as of August 31, 2009)
Dr. Arend Oetker indirectly holds a total of 1,650,010
shares and Dr. Dr. h. c. Andreas J. Büchting 100,020
shares in KWS SAAT AG. All together, the members of the
Supervisory Board hold 1,750,065 shares in KWS SAAT AG.
In sum, the members of the Executive Board hold 2,000
shares in KWS SAAT AG.
76
Annual Financial Statements I Notes I Notes to the income statement I 77
KWS_GB0809_en_Bilanz_RZ_20091112.indd 76-77
12.11.09 15:10
(30) Supervisory and Executive Board of KWS SAAT AG
SUPERVISORY BOARD
Dr. Carl-Ernst Büchting
Einbeck
Honorary Chairman
Dr. Dr. h. c. Andreas J. Büchting
Einbeck
Agricultural Biologist
Chairman
Membership of other legally mandated
Supervisory Boards:
• Conergy AG, Hamburg (until January 31, 2009)
Dr. Arend Oetker
Berlin
Businessman
Deputy Chairman
Membership of other legally mandated
Supervisory Boards:
• Schwartauer Werke GmbH & Co. KGaA,
Bad Schwartau (Chairman)
• Merck KGaA, Darmstadt (until July 1, 2009)
• Cognos AG, Hamburg (Chairman)
Membership of comparable German and
foreign oversight boards:
• Hero AG, Lenzburg (President)
• Bâloise Holding AG, Basle/Switzerland
(until May 1, 2009)
• E. Gundlach GmbH & Co. KG, Bielefeld
• Leipziger Messe GmbH, Leipzig
• Berliner Philharmonie GmbH, Berlin (Chairman)
Hubertus von Baumbach
Ingelheim
Businessman
Jürgen Bolduan
Einbeck
Seed Breeding Employee
Chairman of the Central Works Committee of KWS SAAT AG
Cathrina Claas-Mühlhäuser
Frankfurt/Main
Businesswoman
Membership of other legally mandated
Supervisory Boards:
• CLAAS KGaA mbH, Harsewinkel
Membership of comparable German and
foreign oversight boards:
• CLAAS KGaA mbH, Harsewinkel
(Deputy Chairwoman of the Shareholders’ Committee)
Dr. Dietmar Stahl
Einbeck
Biochemist
Employee Representative
EXECUTIVE BOARD
Philip von dem Bussche
Einbeck
(CEO)
Corporate Affairs, Sugarbeet, Human Resources
Membership of legally mandated
Supervisory Boards:
• Sisi Wasabi AG, Berlin (until July 6, 2009)
Dr. Christoph Amberger
Northeim
Corn, Cereals, Marketing
Dr. Léon Broers (Deputy)*
Einbeck, D / Heythuysen, NL
Research and Breeding, Energy Plants
* Full member of the Executive Board since January 1, 2009
Dr. Hagen Duenbostel
Einbeck
Finance, Controlling, Legal, Information Technology
Membership of legally mandated
Supervisory Boards:
• Sievert AG, Osnabrück
Committees
Chairman
Members
Audit Committee
Hubertus von Baumbach
Andreas J. Büchting, Cathrina Claas-Mühlhäuser
Committee for Executive Board Affairs Andreas J. Büchting
Arend Oetker, Cathrina Claas-Mühlhäuser
Nominating Committee
Andreas J. Büchting
Arend Oetker, Cathrina Claas-Mühlhäuser
(31) Significant subsidiaries and affiliated companies
A list of shareholdings of KWS SAAT AG is published in the Electronic Federal Gazette.
Subsidiaries and associated companies, which were included in the consolidated group 1)
Sugarbeet
Corn
Cereals
Breeding & Services
100 % BETASEED INC. 2)
100 % KWS MAIS GMBH
81 % KWS LOCHOW GMBH
100 % PLANTA ANGEWANDTE
Shakopee, MN/USA
Einbeck
100 % KWS FRANCE S. A. R. L.
100 % KWS BENELUX B. V.5)
Roye/France
100 % DELITZSCH
PFLANZENZUCHT GMBH 10)
Einbeck
100 % O. O. O. KWS RUS 12)
Moscow/Russia
100 % KWS ITALIA S. P. A.
Forli/Italy
100 % KWS POLSKA SP. Z O. O.
Poznan/Poland
100 % KWS SCANDINAVIA A/S 10)
Guldborgsund/Denmark
100 % KWS SEMILLAS IBERICA S. L.10)
Zaratán/Spain
100 % SEMILLAS KWS CHILE LTDA.
Santiago de Chile/Chile
100 % KWS SEME YU D. O. O.
New Belgrad/Serbia
100 % KWS SUISSE SA
Basle/Switzerland
100 % ACH SEEDS INC.4)
Eden Prairie, MN/USA
100 % BETASEED FRANCE S. A. R. L.4)
Sarreguemines/France
100 % KWS UKRAINE T.O.W.12)
Amsterdam/Netherlands
100 % KWS SEMENA S. R. O.5)
Zahorska Ves/Slovakia
100 % KWS MAIS FRANCE S. A. R. L.5)
Sarreguemines/France
100 % KWS AUSTRIA SAAT GMBH 5)
Vienna/Austria
100 % KWS SEMINTE S. R. L.5)
Bukarest/Romania
100 % DUNASEM S. R. L.13)
Bukarest/Romania
100 % KWS SJEME D. O. O.5)
Pozega/Croatia
100 % KWS OSIVA S. R. O.5)
Velke Mezirici/Czechia
100 % KWS SEMENA BULGARIA
E. O. O. D.5) Sofia/Bulgaria
100 % AGROMAIS GMBH5)
Everswinkel
100 % KWS MAGYARORSZÁG KFT.5)
Györ/Hungary
95 % KWS ARGENTINA S. A.5)
Balcarce/Argentina
51 % RAZES HYBRIDES S. A. R. L.3)
Alzonne/France
Kiew/Ukraine
50 % AGRELIANT GENETICS LLC.6) *
100 % KWS TÜRK TARIM TICARET
Westfield, IND/USA
A. S. 10)
Eskisehir/Turkey
50 % AGRELIANT GENETICS INC.*
Chatham, Ontario/Canada
Bergen
100 % KWS UK LTD.7)
Thriplow/Great Britain
100 % KWS LOCHOW
POLSKA SP.Z O.O.7)
Kondratowice/Poland
49 % SOCIETE DE MARTINVAL S. A.8) *
Mons-en-Pévèle/France
100 % SA MOMONT HENNETTE 14)
Mons-en-Pévèle/France
95 % SARL LABOGERM 14)
PFLANZENGENETIK UND
BIOTECHNOLOGIE GMBH**
Einbeck
100 % KWS INTERSAAT GMBH
Einbeck
100 % KWS SEEDS INC.9)
Shakopee, MN/USA
100 % GLH SEEDS, INC.2)
Shakopee, MN/USA
100 % KWS SAATFINANZ GMBH
Einbeck
Mons-en-Pévèle/France
100 % KWS KLOSTERGUT
100 % SARL ADRIEN MOMONT 14)
Mons-en-Pévèle/France
100 % SCA HAMET 14)
Mons-en-Pévèle/France
WIEBRECHTS HAUSEN GMBH
Northeim-Wiebrechtshausen
100 % EURO HYBRID GESELLSCHAFT
FÜR GETREIDEZÜCHTUNG MBH
Einbeck
100 % O. O. O. KWS R&D RUS 11)
Lipezk/Russia
100 % RAGIS KARTOFFELZUCHT- UND
HANDELSGESELLSCHAFT MBH
Klein Wanzleben
50 % VAN RIJN - KWS B.V. *
Poeldijk/Netherlands
85 % VAN RIJN UK LTD. 15)
Donington/Great Britain
70 % VAN RIJN FRANCE S.A.R.L 15)
Bazemont/France
67 % VAN RIJN BALCAN S.R.L 15)
Vulcan/Romania
75 % DYNAGRI S.A.R.L. 15)
Casablanca/Morocco
* Proportionate consolidation
** Profit transfer agreement
1) The percentages stated relate to the interest held by the parent
2) Subsidiary of KWS SEEDS INC.
3) Subsidiary of KWS FRANCE S. A. R. L.
4) Subsidiary of BETASEED INC.
5) Subsidiary of KWS MAIS GMBH
6) Investee of GLH SEEDS, INC.
Subsidiary of KWS LOCHOW GMBH
Investee of KWS LOCHOW GMBH
Subsidiary of KWS INTERSAAT GMBH und KWS SAAT AG
7)
8)
9)
10) Subsidiary of KWS INTERSAAT GMBH
11) Subsidiary of O. O. O. KWS RUS
12) Subsidiary of EURO HYBRID GMBH und KWS SAATFINANZ GMBH
13) Subsidiary of KWS MAIS GMBH und KWS SAATFINANZ GMBH
14) Subsidiary of SOCIETE DE MARTINVAL S. A.
15) Subsidiary of VAN RIJN - KWS B.V.
June 30, 2009
78
Annual Financial Statements I Notes I General disclosures I 79
(32) Proposal for the appropriation of net retained profits
Product development expenditure increased as planned,
with the result that KWS SAAT AG posted operating in-
come of € 11,268 thousand compared with € 24,530 thou-
sand for the previous year, which was, however, bolstered
by large non-recurring, tax-free profits from disposals.
Allowing for net financial income/expenses of € 3,272
thousand and income taxes totaling € 3,090 thousand,
net income was € 11,450 thousand (€ 24,100 thousand).
Adding the net profit of € 860 thousand brought forward
from the previous year, a net retained profit of € 12,310
thousand is available for distribution.
A proposal will be made to the Annual Shareholders’ Meet-
ing that an amount of € 11,880,000.00 of KWS SAAT AG’s
net retained profit should be distributed as a dividend of
€ 1.80 (1.70) for each of the 6,600,000 shares.
The balance of € 430,000.00 is to be carried forward to the
new account.
Declaration by legal representatives
We declare to the best of our knowledge that the consol-
idated financial statements give a true and fair view of the
assets, financial position and earnings of the Group in
compliance with the generally accepted standards of
consolidated accounting, and that an accurate picture of
the course of business, including business results, and the
Group’s situation is conveyed by the Group Management
Report, and that it describes the main opportunities and
risks of the Group’s anticipated development.
Einbeck, October 8, 2009
KWS SAAT AG
THE EXECUTIVE BOARD
P. von dem Bussche
Ch. Amberger
L. Broers
H. Duenbostel
In our opinion pursuant to the findings gained during the
audit, the consolidated financial statements of KWS SAAT
AG, Einbeck, comply with the IFRS as applicable in the EU,
and in addition with the commercial law regulations to be
applied pursuant to Section 315a (1) of the HGB (German
Commercial Code), and give a true and fair view of the as-
sets, financial position and earnings of the Group, taking
into account these regulations. The Group Management
Report accords with the consolidated financial statements,
conveys overall an accurate view of the Group’s position
and accurately presents the opportunities and risks of
future development.
Hanover, October 9, 2009
Deloitte & Touche GmbH
Wirtschaftsprüfungsgesellschaft
(Dr. F. Beine)
Auditor
(Bukowski)
Auditor
Auditors’ Report
We have audited the annual financial statements of the
KWS Group – consisting of the Balance Sheet, the Income
Statement, the Notes, the Cash Flow Statement, Segment
reporting and the Statement of Changes in Equity – and
the Group Management Report for the fiscal year from July
1, 2008, to June 30, 2009, all of which were prepared by
KWS SAAT AG, Einbeck. The preparation of the consoli-
dated financial statements and Group Management Report
according to the International Financial Reporting Standards
(IFRS) as applicable in the EU, and in addition according to
the commercial law regulations to be applied pursuant to
Section 315a (1) of the HGB (German Commercial Code),
is the responsibility of the Executive Board of the company.
Our task is to give, on the basis of the audit we have con-
ducted, an opinion on the consolidated financial statements
and the Group Management Report.
We conducted our audit of the annual financial statements
in accordance with Section 317 HGB and the generally ac-
cepted standards for the audit of financial statements prom-
ulgated by the Institut der Wirtschaftsprüfer (German Institute
of Certified Public Accountants). According to these stan-
dards, the audit must be planned and executed in such a
way that misstatements and violations materially affecting
the presentation of the view of the assets, financial position
and earnings conveyed by the consolidated financial state-
ments, taking into account the applicable regulations on
orderly accounting, and by the Group Management Report
are detected with reasonable certainty. Knowledge of the
business activities and the economic and legal operating
environment of the Group and evaluations of possible errors
are taken into account. The effectiveness of the internal
accounting control system and the evidence supporting
the disclosures in the consolidated financial statements
and the Group Management Report are evaluated mainly
on the basis of test samples within the framework of the
audit. The audit includes the assessment of the annual
financial statements of the companies included in the consol-
idated financial statements, the definition of the companies
consolidated, the accounting and consolidation principles
used and any significant estimates made by the Executive
Board, as well as the evaluation of the overall presentation
of the consolidated financial statements and the Group
Management Report. We believe that our audit provides a
reasonable basis for our opinion. On the basis of our audit,
we have no reservations to note.
80
Annual Financial Statements I Notes I General disclosures I Auditors’ Report I 81
KWS_GB0809_en_Bilanz_RZ_20091112.indd 80-81
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Agenda of the Annual Shareholders’ Meeting
on December 17, 2009
The Company’s Executive Board hereby invites you to the
Annual Shareholders’ Meeting on Thursday, December 17, 2009, at 11 a.m.,
at the Company’s premises in 37574 Einbeck, Grimsehlstraße 31, Germany.
A G E N D A
1. Presentation of the approved Financial Statements of KWS SAAT AG, the Financial Statements of the KWS Group (con-
solidated Financial Statements) approved by the Supervisory Board, the Management Reports for KWS SAAT AG and
the KWS Group for the fiscal year from July 1, 2008, to June 30, 2009, the Report of the Supervisory Board and the ex-
planatory report by the Executive Board on the disclosures in accordance with Section 289 (4) and Section 315 (4) HGB
(German Commercial Code)
2. Resolution on the appropriation of the net retained profit
3. Resolution on the ratification of the acts of the Executive Board
4. Resolution on the ratification of the acts of the Supervisory Board
5. Appointment of the independent auditor for fiscal year 2009/2010
6. Resolution on adjustment to the compensation for members of the Supervisory Board
7. Resolution on amendments to the Articles of Association
Financial calendar
November 26, 2009
December 17, 2009
February 25, 2010
May 28, 2010
October 28, 2010
December 16, 2010
Key data of KWS SAAT AG
Securities identification number
ISIN
Stock exchange identifier
Transparency level
Index
Share class
Number of shares
Capital stock at June 30, 2009
Share price high June 1, 2008 (Xetra)
Share price low October 8, 2008 (Xetra)
Average number of shares traded
– in Xetra
– in floor trading in Frankfurt
82
Report on the 1st quarter of 2009/2010
Annual Shareholders’ Meeting in Einbeck
Report on the 2nd quarter of 2009/2010
Report on the 3rd quarter of 2009/2010
Annual press conference in Hanover;
Analyst conference in Frankfurt
Annual Shareholders’ Meeting in Einbeck
707400
DE0007074007
KWS
Prime Standard
SDAX, GEX
Individual share certificates
6,600,000
€ 19,800,000
€ 147.48
€ 70.00
6,432
608
KWS_GB0809_en_Bilanz_RZ_20091112.indd 82
12.11.09 15:10
Key Figures of the KWS Group
Figures in € millions, unless otherwise specified (IFRS)
Segments of the KWS Group
Fiscal year
Net sales
Operating income (= EBIT)
as a % of net sales (= ROS)
Net income
as a % of net sales
Operative cash flow
Net cash from investing activities
Equity
Equity ratio in %
Balance sheet total
Return on equity in %
Return on assets in %
Fixed assets
Capital expenditure
Depreciation
Average number of employees
Personnel costs
Performance of KWS shares in €
Dividend per share
Earnings per share
Operative cash flow per share
Equity per share
* Dividend of € 1.00 plus anniversary bonus of € 0.20
2008/09
717.2
2007/08
599.1
77.9
10.9
50.1
7.0
82.0
– 59.4
434.5
57.5
756.0
13.0
7.8
231.9
61.1
23.3
3,215
135.0
1.80
6.98
12.42
65.83
70.1
11.7
54.6
9.1
74.6
– 18.1
398.0
59.3
671.1
15.3
9.2
197.1
30.4
17.0
2,856
119.0
1.70
7.74
11.30
60.31
2006/07
537.9
63.9
11.9
38.2
7.1
51.1
– 26.7
366.1
60.0
609.8
11.6
6.8
2005/06
505.0
46.7
9.2
28.4
5.6
53.4
– 20.1
338.0
58.6
577.0
8.9
5.3
189.4
188.6
27.2
16.1
2,739
111.3
1.40
5.61
7.74
23.8
17.0
2,652
109.1
1.20 *
4.16
8.09
55.47
51.21
Sugarbeet
KWS SAAT AG
As well as 15 subsidiaries and affiliated companies*
Net sales € 228.0 million
Operating income € 23.2 million
Corn
KWS MAIS GMBH
As well as 15 subsidiaries and affiliated companies
Net sales € 381.5 million
Operating income € 25.2 million
Cereals
KWS LOCHOW GMBH
As well as 7 subsidiaries and affiliated companies
Net sales € 84.3 million
Operating income € 12.0 million
Breeding & Services
KWS SAAT AG
As well as 14 subsidiaries and affiliated companies
Net sales € 154.2 million (net sales of third parties € 23.4 million)
Operating income € 17.5 million
* Subsidiaries and affiliated companies see page 79
This translation of the original German version of the Annual Report has
been prepared for the convenience of our English-speaking shareholders.
The German version is legally binding.
KWS Saat aG
Grimsehlstrasse 31 • 37555 Einbeck • P.O. Box 1463
Phone +49 (0) 5561/311-0 • Fax +49 (0) 5561/311-322
www.kws.com • e-mail: info@kws.com
Photos/Illustrations:
Eberhard Franke • KWS Group archive • Dominik Obertreis
Andreas Østergaard • Stefan Blume • Rüdiger Jahn • MT-Energie
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