FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934


For the month of July 2010

Commission File Number: 001-15152


SYNGENTA AG
(Translation of registrant’s name into English)

Schwarzwaldallee 215
4058 Basel
Switzerland
(Address of principal executive offices)


Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F
X
 
Form 40-F
   

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes
   
No
X
 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes
   
No
X
 

Indicate by check mark whether by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes
   
No
X
 

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A
 
 


 
 
 
 
 
 
Re:  SYNGENTA AG
   
Press Release: Syngenta 2010 Half Year Results”

Herewith we furnish a press release related to Syngenta AG. The full text of the press release is the following:
 
 
# # #
 
 
 

 
 
Syngenta International AG
 
Media Office
CH-4002 Basel
Switzerland
Tel:     +41 61 323 23 23
Fax:    +41 61 323 24 24
 
www.syngenta.com
Media contact:
 
Médard Schoenmaeckers
Switzerland   +41 61 323 2323
 
 
Analyst/Investor contacts:
 
Jennifer Gough
Switzerland   +41 61 323 5059
USA                +1 202 737 6521
 
John Hudson
Switzerland   +41 61 323 6793
USA                +1 202 737 6520
 
 
 
Basel, Switzerland, July 22, 2010
 
2010 Half Year Results
 
Volume upturn in Q2; strong emerging market performance
 
·  
Sales up 1 percent at $6.7 billion: 3 percent lower at constant exchange rates(1)
 
·  
Q2: volume growth offsetting lower Crop Protection prices, notably NAFTA
 
·  
Seeds growth accelerating, increased margin
 
·  
Investments driving emerging market growth: sales up 15 percent(1)
 
·  
Earnings per share(2) $13.95, 9 percent lower
 
·  
Earnings per share $13.39 after restructuring and impairment, 10 percent lower
 
 
Reported Financial Highlights
 
Excluding Restructuring, Impairment
 
 H1 2010
$m
 H1 2009
$m
Actual
%
 
H1 2010
$m
H1 2009
$m
Actual
%
CER(1)
%
Sales
6,740
6,655
+ 1
 
6,740
6,655
+ 1
- 3
Crop Protection
4,996
5,000
-
 
4,996
5,000
-
- 4
Seeds
1,763
1,676
+ 5
 
1,763
1,676
+ 5
+ 2
Operating Income
1,558
1,783
- 13
 
1,652
1,833
- 10
 
Net Income(3)
1,254
1,402
- 11
 
1,307
1,440
- 9
 
Earnings per share
$13.39
$14.96
- 10
 
$13.95
$15.36
- 9
 
 
Mike Mack, Chief Executive Officer, said:
 
“After a slow first quarter start, demand for our products has increased significantly in 2010, following a 2009 season characterized by low pest pressure and credit constraint.  This is evidenced by solid volume growth in the second quarter, leading to a reduction in the high level of channel inventories which resulted in a competitive pricing environment in developed markets, notably North America.  In the emerging markets we saw a strong performance throughout the first half, particularly in Latin America, as growers continued to invest in new technology. Our longstanding focus on operational efficiency is enabling us to confront a challenging short term environment while continuing to expand our platforms for future growth.
 
“The first half of 2010 saw many successes for our business.  Sales of new Crop Protection products increased by 14 percent with two pipeline products being launched this year.  We opened new capacity for the fungicide AMISTAR® in May and are seeing immediate demand for the increased output. The profitability of our Seeds business improved with excellent grower response to our expanded triple stack offer.  We will build on our growing corn seed franchise with the launch of AGRISURE VIPTERA™ in the fall, and we will also be the first company bringing to market a water optimization solution in corn.”
 

(1)  
Growth at constant exchange rates, see Appendix A.
(2)  
EPS on a fully-diluted basis, excluding restructuring and impairment.
(3)  
Net income to shareholders of Syngenta AG.
 
 
Syngenta - July 22, 2010/Page 1 of 41

 
 
Financial Performance 1st Half 2010
 
Sales $6.7 billion
 
Reported sales were up one percent reflecting a positive contribution from exchange rates.  At constant exchange rates, sales were three percent lower.  Crop Protection sales* were four percent lower, with three percent volume growth partly offsetting lower prices.  Seeds sales were two percent higher, driven by volume growth of three percent.
 
EBITDA margin 28.6 percent
 
EBITDA was nine percent lower (CER) at $1.9 billion.  Gross margin was maintained despite lower prices due to the favorable evolution of raw material costs and to portfolio enhancement in Seeds.  The Seeds EBITDA margin increased, while in Crop Protection profitability reflected lower prices and higher operating expenses linked to investments in emerging markets and in R&D.  Currency movements including hedging made a positive contribution of $57 million to EBITDA.
 
Earnings per share $13.95
 
Earnings per share excluding restructuring and impairment were nine percent lower.  After charges for restructuring and impairment, earnings per share were $13.39 (2009: $14.96).
 
Business Highlights
 
Crop Protection
 
A slow start to the northern hemisphere season due to cold weather was followed by significant volume growth in the second quarter.  High channel inventories, built up in the course of 2009, were progressively drawn down in the second quarter but resulted in a competitive first half price environment, notably in NAFTA.  As a consequence some of the price gains implemented by Syngenta in the first half of 2009 were reversed.  Emerging markets saw a generally robust performance with limited impact from price.
 
In Europe, Africa and the Middle East grower sentiment was affected by the lower wheat price, particularly in France, where the business was also affected by high channel inventory, government credit reforms and the phasing of oilseed rape herbicide sales.  In Eastern Europe, our customers began to resume investment in high value inputs and we were able to ease credit constraints in an improved economic environment.  In NAFTA, the season progressed well leading to a rapid recovery in consumption in the second quarter, although price competition remained intense in certain segments, notably glyphosate and fungicides.  Sales in Latin America surpassed the record level of 2008, with higher soybean acreage in both Brazil and Argentina and increased disease pressure.  We reinforced our market-leading position notably for fungicides.  Growth in Asia Pacific was strong in the emerging markets, particularly China and Vietnam, more than offsetting a decline in the largest market Japan.
 
Selective herbicide sales were lower with declines concentrated in older products.  Sales of corn and soybean herbicides showed good growth notably in the USA, where their importance in dealing with glyphosate-resistant weeds is increasingly being recognized.  A significant reduction in Non-selective herbicides mainly reflected developments in the glyphosate market, with US prices coming down sharply from mid-2009.  Fungicide sales increased by six percent, with the lead product AMISTAR® up 17 percent despite lower US pricing in the second quarter.  Two other major fungicides, RIDOMIL GOLD® and SCORE®, also showed double digit growth with stable pricing.  Insecticide sales were unchanged with strong growth in newer products offsetting declines in older chemistries.  Seed care sales were lower owing largely to high inventories of treated seed in the USA.
 

 

*   Crop Protection sales include $24 million of inter-segment sales.
 
 
Syngenta - July 22, 2010/Page 2 of 41

 

 
Professional products benefited from signs of recovery in consumer markets, notably in the Garden & Ornamentals area.
 
New products: Sales of new products (defined as those launched since 2006) increased by 14 percent (CER) to $295 million.  Sales of the nematicide seed treatment AVICTA® doubled following its launch on corn in the USA.  The cereal herbicide AXIAL® showed strong growth in Eastern Europe and further expansion in its largest market Canada.  The insecticide DURIVO® grew rapidly on rice and vegetables across Asia.  The fungicide REVUS®, used on vegetables and vines, expanded outside Europe and is now sold in all regions.  Isopyrazam, a broad spectrum fungicide with a new mode of action, was launched on barley in the UK.
 
Capacity expansion: New capacity for AMISTAR® was opened at Grangemouth, UK in May.  The opening will result in a production increase of approximately 20 percent in 2010, with immediate demand for the increased output.
 
R&D pipeline: The combined peak sales potential of our Crop Protection pipeline is in excess of $2 billion.  An initial launch in granular form of INVINSA™, a unique product for crop stress protection in field crops, is scheduled for later this year.  The late development pipeline also includes sedaxane, a seed treatment fungicide; bicyclopyrone, a corn and sugar cane herbicide; and an insecticide cyantraniliprole.
 
EBITDA was 13 percent lower (CER) at $1.6 billion with a margin (CER) of 31.8 percent (2009: 35.2 percent).
 
Seeds
 
Growth in Seeds was broad-based with a noticeable acceleration in the second quarter.
 
Corn & Soybean saw growth of eight percent after adjusting for a one off change in US sales terms, which brought sales forward from the first quarter of 2010 to the fourth quarter of 2009.  Sales of our proprietary triple stack corn in the US market expanded significantly to represent around 60 percent of total, approaching market penetration rates.  Sales grew rapidly in Latin America and Eastern Europe.
 
Diverse Field Crops showed solid internal growth supplemented by the acquisition of the Monsanto sunflower business in August 2009.  The main driver was Eastern Europe, where sales increased by more than 30 percent as growers resumed investment in high quality hybrids and varieties.
 
Growth in Vegetables accelerated, led by NAFTA where sales of watermelon and sweet corn, for which capacity has recently been expanded, grew strongly.  Sales in Latin America and the emerging markets of Asia Pacific also grew strongly.
 
Flowers sales were slightly lower owing to weakness in the US market, although in Europe sales showed a significant upturn reflecting an enhanced portfolio and more favorable consumer sentiment.
 
R&D pipeline: Our broad spectrum lepidoptera trait AGRISURE VIPTERA™ received approval from the U.S. Department of Agriculture and from the Japanese regulatory authorities in the first half of the year.  The trait will be launched in the USA as part of a multi-stack offer in the fourth quarter and will provide growers with a new standard for pest control and yield performance.  Also this year Syngenta will bring to market AGRISURE ARTESIAN™, the industry’s first water optimization solution, based on native traits.  Over the next two years a complete range of refuge reduction options in corn will be launched, including     AGRISURE E-Z REFUGE™ (refuge in a bag).
 
EBITDA of $352 million was up seven percent (CER), driven by gross margin expansion.  The EBITDA margin (CER) reached 20.1 percent (2009: 19.1 percent) and remains on track to reach the full year target of 15 percent in 2011.
 
 
Syngenta - July 22, 2010/Page 3 of 41

 
 
Net financial expense
 
Net financial expense at $55 million was slightly higher compared with the first half of 2009 ($46 million).
 
Taxation
 
The underlying tax rate for the period was 19 percent, unchanged compared with the first half of 2009.   In the second half of the year the tax rate is likely to be higher than in the same period last year; over the medium term a tax rate in the low to mid-twenties is expected.
 
Cash flow
 
Free cash flow was $74 million (2009: $79 million).  Fixed capital expenditure of $266 million (2009: $364 million) reflected the concluding phase of capacity expansion projects for key active ingredients.  Average trade working capital as a percentage of sales was 43 percent (2009: 40 percent) reflecting an increase in inventories in the second half of 2009. We continue to target a reduction in trade working capital as a percentage of sales as continued volume growth reduces inventories.
 
Dividend and share repurchase
 
A dividend of CHF 6.00 per share (2009: CHF 6.00) was paid in the second quarter, representing a total payout of $524 million.  In line with Syngenta’s objective of returning around $750 million to shareholders in 2010, 288,700 shares were repurchased in the first half at a total cost of $67 million.  The total cash return to shareholders in the first half was $591 million.
 
Outlook
 
Mike Mack, Chief Executive Officer, said:
 
“In the second half of 2010 we expect positive volume momentum to continue.  As we approach the main season in Latin America, we are assuming that the current favorable fundamentals will support further growth in our business there.  This, coupled with careful control of costs and increasing profitability in Seeds, should allow us to achieve full year operating income around last year’s level.  As indicated earlier in the year, the evolution of earnings per share* will reflect increased net financial expense and a higher tax rate.
 
“Looking ahead, our focus will be on achieving further market share gains in developed markets while building on our track record of operational efficiency.  This will enable us to continue investing in emerging markets, which represent the main growth driver for our business and where we have established leadership positions.  We remain firmly committed to our investments in R&D, which will accelerate new product launches and build on our ability to deliver integrated solutions to growers worldwide.”
 

* Fully diluted, excluding restructuring and impairment
 
 
Syngenta - July 22, 2010/Page 4 of 41

 
Crop Protection
 
For a definition of constant exchange rates, see Appendix A.
 

 
1st Half
Growth
 
2nd Quarter
Growth
Product line
2010
$m
2009
$m
Actual
%
CER
%
 
2010
$m
2009
$m
Actual
%
CER
%
Selective Herbicides
1,620
1,615
-
- 4
 
877
814
+ 8
+ 5
Non-selective Herbicides
548
691
- 21
- 25
 
316
362
- 13
- 16
Fungicides
1,488
1,356
+ 10
+ 6
 
681
634
+ 7
+ 5
Insecticides
700
673
+ 4
-
 
349
318
+ 10
+ 8
Seed Care
369
392
- 6
- 10
 
130
135
- 4
- 6
Professional Products
242
225
+ 7
+ 4
 
122
115
+ 6
+ 4
Others
29
48
- 38
- 39
 
11
37
-68
- 68
Total
4,996
5,000
-
- 4
 
2,486
2,415
+ 3
-
 
Selective Herbicides:  major brands AXIAL®, CALLISTO® family, DUAL®/BICEP® MAGNUM,  FUSILADE®MAX, TOPIK®
 
Sales volume was slightly higher with a substantial increase in Latin America, partially offset by lower volumes in Europe due to the phasing of oilseed rape herbicides in France and Germany, which reduced sales by $47 million.  The decline in total sales (CER) was due to lower prices, mainly in NAFTA, in a more competitive environment.  The CALLISTO® range showed growth in a strong pre-emergence corn herbicide market in the USA.
 
Non-selective Herbicides:  major brands GRAMOXONE®, TOUCHDOWN®
 
In non-selectives, TOUCHDOWN® sales decreased significantly in NAFTA due to lower prices affecting the first half comparison.  Volume was also lower reflecting high channel inventories.  GRAMOXONE® sales were lower with some related weakness, notably in Latin America and Asia Pacific.
 
Fungicides:  major brands ALTO®, AMISTAR®, BRAVO®, REVUS®, RIDOMIL GOLD®, SCORE®, TILT®, UNIX®
 
Fungicide sales were six percent higher on strong volume growth in Latin America, NAFTA and Asia Pacific.  Volume growth was partially offset by price declines, mainly in NAFTA due to high channel inventory and a competitive environment.  AMISTAR® sales increased significantly with volume 31 percent higher, characterized by increased usage intensity and growers’ focus on plant performance in key crops including rice and vegetables in Asia Pacific, soybean in Latin America and corn in NAFTA.  REVUS® continued to show strong growth, with launches in nine new countries.  Our new fungicide, isopyrazam, was introduced in the United Kingdom on barley with first sales in the second quarter.  Additional launches in further countries are planned in key cereals and fruit and vegetable markets.
 
Insecticides: major brands ACTARA®, DURIVO®, FORCE®, KARATE®, PROCLAIM®, VERTIMEC®
 
Insecticide sales were flat with strong growth in DURIVO® and ACTARA® offset by a more competitive environment in some of the older chemistries.  DURIVO® continued to perform strongly in rice and vegetables in Asia Pacific and continued its expansion into new markets, notably with successful launches in Latin America and Japan.  ACTARA® sales growth was broad based with strong gains in Latin America and Asia Pacific.
 
 
Syngenta - July 22, 2010/Page 5 of 41

 
 
Seed Care: major brands AVICTA®, CRUISER®, DIVIDEND®, MAXIM®
 
Seed care sales were 10 percent lower owing largely to high inventories of treated seed in the USA.  The decline in the USA was partially offset by growth in CRUISER® in Latin America and Asia Pacific.
 
Professional Products: major brands FAFARD®, HERITAGE®, ICON®
 
Professional product sales were four percent higher as the consumer-led areas of our Lawn & Garden business showed signs of recovery.  Both Western and Eastern Europe showed double digit growth and the emerging Latin America business expanded rapidly.
 
 
1st Half
Growth
 
2nd Quarter
Growth
Crop Protection
by region
2010
$m
2009
$m
Actual
%
CER
%
 
2010
$m
2009
$m
Actual
%
CER
%
Europe, Africa, Mid. East
1,790
1,810
- 1
- 5
 
831
823
+ 1
-
NAFTA
1,662
1,882
- 12
- 15
 
942
989
- 5
- 8
Latin America
710
550
+ 29
+ 29
 
330
262
+ 26
+ 26
Asia Pacific
834
758
+ 10
+ 2
 
383
341
+ 12
+ 5
Total
4,996
5,000
-
- 4
 
2,486
2,415
+ 3
-
 
Europe, Africa and the Middle East:  Sales were lower due to a prolonged winter in Western Europe which delayed the start of the season as well as the phasing of oilseed rape herbicides.  In France, overall consumption of crop protection products was lower as a result of high channel inventory.  Declines in Western Europe were partially offset by growth in Eastern Europe where the credit situation in most countries eased.  This supported a return to investment in high value inputs, notably in the Ukraine where sales increased almost 60 percent.  Africa and the Middle East showed strong growth in selective herbicides, fungicides and seed care.
 
NAFTA:  Sales were lower in NAFTA due to a more competitive environment.  High channel inventory and a more cautious stance by distributors, as well as marketing actions to speed technology adoption, contributed to price pressure.  Excluding glyphosate, price was 11 percent lower while volume was slightly higher primarily on an expanded fungicide market.  TOUCHDOWN® accounted for more than 40 percent of the sales decline in NAFTA.
 
Latin America:  Latin America completed an excellent season with significantly higher sales; slightly higher than the record first half level of 2008.  Soybean acreage in the region expanded and increased disease pressure resulted in greater usage intensity and a reinforcement of Syngenta’s market leading position.  Liquidity also improved markedly and soybean prices were supported by Chinese demand.  Growth was led by PRIORI Xtra®, our leading fungicide for the treatment of soybean rust.
 
Asia Pacific:  Growth in Asia Pacific continued as strong government support for agriculture enabled growers to continue investing in yield improvement, notably in rice and vegetables.  Growth was primarily due to increased demand for fungicides, led by AMISTAR®, with sales up 12 percent.
 
 
Syngenta - July 22, 2010/Page 6 of 41

 
 
Seeds
 
For a definition of constant exchange rates, see Appendix A.
 
 
1st Half
Growth
 
2nd Quarter
Growth
Product line
2010
$m
2009
$m
Actual
%
CER
%
 
2010
$m
2009
$m
Actual
%
CER
%
Corn & Soybean
806
843
- 4
- 7
 
253
213
+ 19
+ 16
Diverse Field Crops
386
304
+ 27
+ 19
 
193
155
+ 24
+ 19
Vegetables
360
322
+ 12
+ 9
 
200
180
+ 11
+ 11
Flowers
211
207
+ 2
- 1
 
81
74
+ 9
+ 8
Total
1,763
1,676
+ 5
+ 2
 
727
622
+ 17
+ 14
 
Corn & Soybean: major brands AGRISURE®, GARST®, GOLDEN HARVEST®, NK®
 
Corn and Soybean sales were up by eight percent adjusting for the impact of advanced sales in the fourth quarter of 2009.  Growth occurred across all regions, led by a strong season in the US and good growth in Latin America and Eastern Europe.  Sales of our proprietary triple stack corn AGRISURE® 3000 GT in the USA showed a significant advance, representing around 60 percent of our portfolio.
 
Diverse Field Crops:  major brands NK® oilseeds, HILLESHÖG® sugar beet
 
Diverse Field Crops sales increased significantly on good underlying growth supplemented by acquisitions.  Sales expanded in Eastern Europe, with significant growth in Russia and the Ukraine on higher sunflower acreage.  The acquisition of Monsanto’s sunflower business added 12 percent to product line sales.
 
Vegetables: major brands DULCINEA®, ROGERS®, S&G®, Zeraim Gedera
 
Vegetables continued to show excellent growth with sales up nine percent.  Underlying growth excluding acquisitions and divestments was 10 percent, with double digit expansion in all regions with the exception of Europe, where sales were unchanged.  Growth continued to reflect the ongoing progress of high value products in our strategic crops, notably tomato, watermelon and sweet corn.
 
Flowers: major brands Fischer, Goldfisch, Goldsmith Seeds, S&G®, Yoder
 
Flowers sales were down slightly due to NAFTA where the market was characterized by lower consumer demand in a subdued economic environment.  The decline in NAFTA was partially offset by growth in Europe and Asia Pacific as those markets began to show signs of recovery.
 
 
1st Half
Growth
 
2nd Quarter
Growth
Seeds by region
2010
$m
2009
$m
Actual
%
CER
%
 
2010
$m
2009
$m
Actual
%
CER
%
Europe, Africa, Mid. East
762
659
+ 16
+ 9
 
297
251
+ 18
+ 15
NAFTA
826
880
- 6
- 7
 
329
300
+ 9
+ 8
Latin America
62
41
+ 52
+ 52
 
31
14
+ 122
+ 122
Asia Pacific
113
96
+ 18
+ 11
 
70
57
+ 24
+ 16
Total
1,763
1,676
+ 5
+ 2
 
727
622
+ 17
+ 14
 
 
Syngenta - July 22, 2010/Page 7 of 41

 
 
Announcements and Meetings
 
Third quarter trading statement 2010
October 14, 2010
Announcement of 2010 Full Year Results
February 9, 2011
First quarter trading statement 2011
April 15, 2011
AGM
April 19, 2011
 
Syngenta is one of the world's leading companies with more than 25,000 employees in over 90 countries dedicated to our purpose: Bringing plant potential to life.  Through world-class science, global reach and commitment to our customers we help to increase crop productivity, protect the environment and improve health and quality of life.  For more information about us please go to www.syngenta.com.


Note to the editor:
Further information, documents and images will be available on our website www.syngenta.com/hyr2010.
 

 





Cautionary Statement Regarding Forward-Looking Statements
 
This document contains forward-looking statements, which can be identified by terminology such as ‘expect’, ‘would’, ‘will’, ‘potential’, ‘plans’, ‘prospects’, ‘estimated’, ‘aiming’, ‘on track’ and similar expressions. Such statements may be subject to risks and uncertainties that could cause the actual results to differ materially from these statements. We refer you to Syngenta's publicly available filings with the U.S. Securities and Exchange Commission for information about these and other risks and uncertainties. Syngenta assumes no obligation to update forward-looking statements to reflect actual results, changed assumptions or other factors. This document does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer, to purchase or subscribe for any ordinary shares in Syngenta AG, or Syngenta ADSs, nor shall it form the basis of, or be relied on in connection with, any contract therefor.

 
Syngenta - July 22, 2010/Page 8 of 41

 
 
Syngenta Group
 
Interim Condensed Consolidated Financial Statements
 
The following condensed consolidated financial statements and notes thereto have been prepared in accordance with IAS 34, “Interim Financial Reporting”, as disclosed in Note 1 below.  They do not contain all of the information which IFRS would require for a complete set of financial statements and should be read in conjunction with the annual consolidated financial statements.
 
Condensed Consolidated Income Statement
 
For the six months ended June 30,
(US$ million, except share and per share amounts)
 
2010
   
2009(a)
 
Sales
    6,740       6,655  
Cost of goods sold
    (3,245 )     (3,208 )
Gross profit
    3,495       3,447  
Marketing and distribution
    (903 )     (836 )
Research and development
    (507 )     (444 )
General and administrative
    (443 )     (335 )
Restructuring and impairment
    (84 )     (49 )
Operating income
    1,558       1,783  
Income from associates and joint ventures
    21       2  
Financial expense, net
    (55 )     (46 )
Income before taxes
    1,524       1,739  
Income tax expense
    (265 )     (329 )
Net income
    1,259       1,410  
Attributable to:
               
Non-controlling interests
    5       8  
Syngenta AG shareholders
    1,254       1,402  
Net income
    1,259       1,410  
Earnings per share (US$):
               
Basic
    13.47       15.05  
Diluted
    13.39       14.96  
Weighted average number of shares:
               
Basic
    93,075,102       93,179,087  
Diluted
    93,660,855       93,758,202  
 
All amounts relate to continuing operations.
 
(a) After effect of accounting policy change for post-employment benefits described in Note 3 below.
 
 
Syngenta - July 22, 2010/Page 9 of 41

 
 
Condensed Consolidated Statement of Comprehensive Income
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009(a)
 
Net income
    1,259       1,410  
Components of other comprehensive income (OCI):
               
Actuarial losses of defined benefit post-employment plans
    (173 )     (143 )
Unrealized holding gains/(losses) on available-for-sale financial assets
    2       (18 )
Unrealized gains on derivatives designated as cash flow and net investment hedges
    8       84  
Currency translation effects
    (277 )     155  
Income tax relating to OCI
    41       50  
Total comprehensive income
    860       1,538  
Attributable to:
               
Non-controlling interests
    5       8  
Syngenta AG shareholders
    855       1,530  
Total comprehensive income
    860       1,538  
 
All amounts relate to continuing operations.
 
(a) After effect of accounting policy change for post-employment benefits described in Note 3 below.
 
 
Syngenta - July 22, 2010/Page 10 of 41

 
 
Condensed Consolidated Balance Sheet
 
(US$ million)
 
June 30,
2010
   
June 30,
2009(a)
   
December 31,
2009(a)
 
Assets
                 
Current assets:
                 
Cash and cash equivalents
    881       1,765       1,552  
Trade receivables
    4,197       4,245       2,506  
Other accounts receivable
    575       432       558  
Inventories
    3,441       3,356       3,922  
Derivative and other financial assets
    268       366       156  
Other current assets
    284       198       200  
Total current assets
    9,646       10,362       8,894  
Non-current assets:
                       
Property, plant and equipment
    2,685       2,404       2,738  
Intangible assets
    3,006       3,058       3,102  
Deferred tax assets
    707       528       747  
Defined benefit pension assets
    2       20       25  
Derivative financial assets
    115       147       248  
Other non-current financial assets
    346       333       375  
Total non-current assets
    6,861       6,490       7,235  
Total assets
    16,507       16,852       16,129  
Liabilities and equity
                       
Current liabilities:
                       
Trade accounts payable
    (2,828 )     (2,743 )     (2,468 )
Current financial debt
    (223 )     (852 )     (281 )
Income taxes payable
    (465 )     (475 )     (376 )
Derivative financial liabilities
    (150 )     (389 )     (145 )
Other current liabilities
    (675 )     (851 )     (827 )
Provisions
    (189 )     (164 )     (214 )
Total current liabilities
    (4,530 )     (5,474 )     (4,311 )
Non-current liabilities:
                       
Financial debt and other non-current liabilities
    (3,369 )     (3,425 )     (3,527 )
Deferred tax liabilities
    (658 )     (432 )     (688 )
Provisions
    (1,186 )     (1,243 )     (1,116 )
Total non-current liabilities
    (5,213 )     (5,100 )     (5,331 )
Total liabilities
    (9,743 )     (10,574 )     (9,642 )
Equity:
                       
Shareholders’ equity
    (6,755 )     (6,258 )     (6,473 )
Non-controlling interests
    (9 )     (20 )     (14 )
Total equity
    (6,764 )     (6,278 )     (6,487 )
Total liabilities and equity
    (16,507 )     (16,852 )     (16,129 )
 
(a) After effect of accounting policy change for post-employment benefits described in Note 3 below.
 
 
Syngenta - July 22, 2010/Page 11 of 41

 
 
Condensed Consolidated Cash Flow Statement
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009(a)
 
Income before taxes
    1,524       1,739  
Reversal of non-cash items
    428       312  
Cash (paid)/received in respect of:
               
Interest and other financial receipts
    63       56  
Interest and other financial payments
    (183 )     (212 )
Income taxes
    (139 )     (94 )
Restructuring costs
    (22 )     (48 )
Contributions to pension plans, excluding restructuring costs
    (69 )     (59 )
Other provisions
    (31 )     (32 )
Cash flow before change in net working capital
    1,571       1,662  
Change in net working capital:
               
Change in inventories
    293       205  
Change in trade and other accounts receivable and
other net current assets
    (1,953 )     (1,726 )
Change in trade and other accounts payable
    410       218  
Cash flow from operating activities
    321       359  
Additions to property, plant and equipment
    (183 )     (283 )
Proceeds from disposals of property, plant and equipment
    8       21  
Purchases of intangible assets
    (75 )     (71 )
Purchases of investments in associates and other financial assets
    (8 )     (10 )
Proceeds from disposals of intangible and financial assets
    29       70  
Cash flow from disposal of marketable securities
    30       5  
Acquisitions and divestments, net
    (6 )     (7 )
Cash flow used for investing activities
    (205 )     (275 )
Increases in third party interest-bearing debt
    91       1,464  
Repayments of third party interest-bearing debt
    (252 )     (142 )
Sale/(purchase) of treasury shares and options over own shares
    (73 )     26  
Acquisition of non-controlling interests
    (12 )     -  
Dividends paid
    (524 )     (491 )
Cash flow (used for)/from financing activities
    (770 )     857  
Net effect of currency translation on cash and cash equivalents
    (17 )     21  
Net change in cash and cash equivalents
    (671 )     962  
Cash and cash equivalents at the beginning of the period
    1,552       803  
Cash and cash equivalents at the end of the period
    881       1,765  
 
(a) After effect of accounting policy change for post-employment benefits described in Note 3 below.
 
 
Syngenta - July 22, 2010/Page 12 of 41

 
 
Condensed Consolidated Statement of Changes in Equity
 
 
      Attributable to Syngenta AG shareholders            
(US$ million)
 
Par
value of
ordinary
shares
   
Additional
paid-in
capital
   
Treasury
shares,
at cost
   
Fair
value
reserves
   
Cumulative
translation
adjustment
   
Retained
earnings
   
Total
share-
holders’
equity
   
Non-controlling interests
   
Total
equity
 
January 1, 2009(a),(b)
    6       3,577       (745 )     (152 )     176       2,412       5,274       17       5,291  
Net Income(a)
                                            1,402       1,402       8       1,410  
OCI(a),(b)
                            55       175       (102 )     128               128  
Share-based payment and income tax thereon
                    18                       38       56               56  
Dividends paid
                                            (491 )     (491 )             (491 )
Share repurchases
                    (111 )                             (111 )             (111 )
Other
                                                    -       (5 )     (5 )
June 30, 2009(a),(b)
    6       3,577       (838 )     (97 )     351       3,259       6,258       20       6,278  
                                                                         
                                                                         
January 1, 2010(a),(b)
    6       3,491       (217 )     (113 )     486       2,820       6,473       14       6,487  
Net Income
                                            1,254       1,254       5       1,259  
OCI
                            12       (292 )     (119 )     (399 )             (399 )
Share-based payment and income tax thereon
                    12                       35       47               47  
Dividends paid
                                            (524 )     (524 )             (524 )
Share repurchases
                    (93 )                             (93 )             (93 )
Other
                                            (3 )     (3 )     (10 )     (13 )
June 30, 2010
    6       3,491       (298 )     (101 )     194       3,463       6,755       9       6,764  
 
A dividend of CHF 6.00 (US$5.62) (2009: CHF 6.00 (US$5.25)) per share was paid to Syngenta AG shareholders during the period.
 
(a) After effect of accounting policy change for post-employment benefits described in Note 3 below.
(b) After reclassification of income tax charged to OCI described in Note 3 below.

 
Syngenta - July 22, 2010/Page 13 of 41

 
 
Syngenta Group
 
Notes to Interim Condensed Consolidated Financial Statements
 
Note 1: Basis of preparation
 
Nature of operations: Syngenta AG (“Syngenta”) is a global crop protection and seeds business engaged in the discovery, development, manufacture and marketing of a range of agricultural products designed to improve crop yields and food quality.
 
Basis of presentation and accounting policies: The condensed consolidated financial statements for the six months ended June 30, 2010 and 2009 incorporate the financial statements of Syngenta AG and of all of its subsidiaries (“Syngenta Group”).  They have been prepared in accordance with IAS 34, “Interim Financial Reporting”, and, except as disclosed in Note 3 below, with the accounting policies described in Note 2 to Syngenta’s 2009 annual consolidated financial statements.  Syngenta prepares its annual consolidated financial statements in accordance with International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB).  The condensed consolidated financial statements were authorized for issue by the Board of Directors on July 20, 2010.
 
The condensed consolidated financial statements are presented in United States dollars (US$) as this is the major currency in which revenues are denominated.
 
Impairment losses recognized on goodwill and available-for-sale equity securities in interim financial statements are not reversed in the annual financial statements even if the decline in value which caused the impairment loss to be recognized has reversed by the end of the annual reporting period.
 
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimated.
 
Note 2: Seasonality of operations
 
The timing of Syngenta’s sales, profit and cash flows throughout the year is significantly influenced by seasonal factors.  Operating in the agriculture sector, sales of Syngenta’s products principally occur before and during the growing season.  Because many of Syngenta’s largest markets are in the Northern Hemisphere, which has a spring growing season, significantly more sales occur and profit is earned during the first half of the year than in the second half.  Collections of trade accounts receivable from customers in these Northern Hemisphere markets largely occur during the second half of the year.  As a result, operating cash flow typically is significantly lower during the first half of the year than during the second half.
 
 
Syngenta - July 22, 2010/Page 14 of 41

 
 
Note 3: Changes in accounting policies
 
Adoption of new IFRSs
 
Syngenta has adopted the following new IFRSs in 2010:
 
IFRS 3 (revised January 2008) and IAS 27 (revised January 2008) introduced changes to the accounting for business combinations. These revised IFRSs apply to transactions Syngenta completes after January 1, 2010. The accounting for business combinations completed in prior years is not affected. During the six months ended June 30, 2010, Syngenta had no significant transactions to which these revised IFRSs were applicable.
 
The following IFRSs adopted in 2010 had no impact on Syngenta’s condensed consolidated financial statement, other than as noted below:
 
·
“Improvements to IFRSs”, issued April 2009. Disclosure of assets by reportable segment is now required only if that information is provided to the chief operating decision maker.  As Syngenta does not provide assets by reportable segment to its chief operating decision maker, assets by reportable segment are not disclosed in the condensed consolidated financial statements.
 
·
Amendments to IAS 39, “Eligible Hedged Items”, issued July 2008.
 
·
IFRIC 17, “Distributions of Non-Cash Assets to Owners”, issued November 2008.
 
·
Syngenta has early adopted the amendment to IAS 1 “Presentation of Financial Statements” contained in “Improvements to IFRSs”, issued May 2010 and has therefore shown net income and other comprehensive income as separate line items in the statement of changes in equity.
 
Change in accounting policy for actuarial gains and losses
 
In these consolidated financial statements, Syngenta has recognized actuarial gains and losses of defined benefit post-employment plans in other comprehensive income in the periods in which they arose (“immediate recognition in OCI method”). Previously, Syngenta applied the corridor method of deferred recognition.  In the opinion of Syngenta, the immediate recognition in OCI method presents Syngenta’s post-employment benefit obligations in the consolidated balance sheet in a more understandable way than the corridor method. For the six months ended June 30, 2010, defined benefit post-employment expense recognized within operating income was US$40 million and actuarial losses recognized directly in retained earnings were US$173 million. Related income tax amounts were credits of US$11 million and US$54 million respectively. Had Syngenta still applied the corridor method, an additional US$23 million of post-employment benefit expense would have been recognized within operating income, representing amortization of actuarial losses, and no amounts would have been recognized directly in retained earnings.
 
This accounting policy change has been applied retrospectively in accordance with IAS 8, and its effect on the comparative information presented for each financial statement line item is set out in the following tables:
 
 
Syngenta - July 22, 2010/Page 15 of 41

 

 
Changes to Interim Condensed Consolidated Income Statement
 
For the six months ended June 30, 2009
(US$ million, except per share amounts)
 
2009
 as reported
   
Immediate recognition
policy change
   
2009 after
policy change
 
Sales
    6,655       -       6,655  
Cost of goods sold
    (3,215 )     7       (3,208 )
Gross profit
    3,440       7       3,447  
Marketing and distribution
    (839 )     3       (836 )
Research and development
    (448 )     4       (444 )
General and administrative
    (346 )     11       (335 )
Restructuring and impairment
    (49 )     -       (49 )
Operating income
    1,758       25       1,783  
Income from associates and joint ventures
    2       -       2  
Financial expense, net
    (46 )     -       (46 )
Income before taxes
    1,714       25       1,739  
Income tax expense
    (321 )     (8 )     (329 )
Net income
    1,393       17       1,410  
Attributable to:
                       
Non-controlling interests
    8       -       8  
Syngenta AG shareholders
    1,385       17       1,402  
Net income
    1,393       17       1,410  
Earnings per share (US$):
                       
Basic
    14.87       0.18       15.05  
Diluted
    14.78       0.18       14.96  
 
Changes to Interim Consolidated Statement of Comprehensive Income
 
For the six months ended June 30, 2009
(US$ million)
 
2009
 as reported
   
Immediate recognition
policy change
   
2009 after
policy change
 
Net income
    1,393       17       1,410  
Components of OCI:
                       
Actuarial gains/(losses)
    -       (143 )     (143 )
Unrealized gains/(losses) on available-for-sale financial assets
    (18 )     -       (18 )
Unrealized gains/(losses) on derivatives designated as cash flow and net investment hedges
    84       -       84  
Currency translation effects
    180       (25 )     155  
Income tax relating to OCI
    9       41       50  
Total comprehensive income
    1,648       (110 )     1,538  
Attributable to:
                       
Non-controlling interests
    8       -       8  
Syngenta AG shareholders
    1,640       (110 )     1,530  
Total comprehensive income
    1,648       (110 )     1,538  

 
Syngenta - July 22, 2010/Page 16 of 41

 
 
Changes to Interim Condensed Consolidated Balance Sheet
 
 
At June 30, 2009
(US$ million)
 
2009
 as reported
   
Immediate recognition
policy change
   
2009 after
policy change
 
Assets
                 
Total current assets
    10,362       -       10,362  
Non-current assets:
                       
Deferred tax assets
    516       12       528  
Defined benefit pension asset
    666       (646 )     20  
Other non-current assets
    5,942       -       5,942  
Total non-current assets
    7,124       (634 )     6,490  
Total assets
    17,486       (634 )     16,852  
Liabilities and equity
                       
Current liabilities:
                       
Provisions
    (145 )     (19 )     (164 )
Other current liabilities
    (5,310 )     -       (5,310 )
Total current liabilities
    (5,455 )     (19 )     (5,474 )
Non-current liabilities:
                       
Deferred tax liabilities
    (721 )     289       (432 )
Provisions
    (887 )     (356 )     (1,243 )
Other liabilities
    (3,425 )     -       (3,425 )
Total non-current liabilities
    (5,033 )     (67 )     (5,100 )
Total liabilities
    (10,488 )     (86 )     (10,574 )
Equity:
                       
Shareholders’ equity
    (6,978 )     720       (6,258 )
Non-controlling interests
    (20 )     -       (20 )
Total equity
    (6,998 )     720       (6,278 )
Total liabilities and equity
    (17,486 )     634       (16,852 )

 
Syngenta - July 22, 2010/Page 17 of 41

 
 
Changes to Condensed Consolidated Balance Sheet
 
At December 31, 2009
(US$ million)
 
2009
 as reported
   
Immediate recognition
policy change
   
 
 2009 after
policy change
 
Assets
                 
Total current assets
    8,894       -       8,894  
Non-current assets:
                       
Deferred tax assets
    660       87       747  
Defined benefit pension asset
    679       (654 )     25  
Other non-current assets
    6,463       -       6,463  
Total non-current assets
    7,802       (567 )     7,235  
Total assets
    16,696       (567 )     16,129  
Liabilities and equity
                       
Current liabilities:
                       
Provisions
    (154 )     (60 )     (214 )
Other current liabilities
    (4,097 )     -       (4,097 )
Total current liabilities
    (4,251 )     (60 )     (4,311 )
Non-current liabilities:
                       
Deferred tax liabilities
    (884 )     196       (688 )
Provisions
    (879 )     (237 )     (1,116 )
Other liabilities
    (3,527 )     -       (3,527 )
Total non-current liabilities
    (5,290 )     (41 )     (5,331 )
Total liabilities
    (9,541 )     (101 )     (9,642 )
Equity:
                       
Shareholders’ equity
    (7,141 )     668       (6,473 )
Non-controlling interests
    (14 )     -       (14 )
Total equity
    (7,155 )     668       (6,487 )
Total liabilities and equity
    (16,696 )     567       (16,129 )
 
Changes to Interim Consolidated Cash Flow Statement
 
For the six months ended June 30, 2009
(US$ million)
 
 
2009
As reported
   
Immediate recognition
 policy change
   
2009 after
 policy change
 
Income before taxes
    1,714       25       1,739  
Reversal of non-cash items
    337       (25 )     312  
Cash flow from operating activities
    359       -       359  
 
Changes to Equity
 
At January 1, 2009
(US$ million)
 
2009
as reported
   
Immediate recognition
policy change
   
2009 after
policy change
 
Total shareholders’ equity
    (5,884 )     610       (5,274 )
Total equity
    (5,901 )     610       (5,291 )

 
Syngenta - July 22, 2010/Page 18 of 41

 
 
Change in classification of income tax charged directly to OCI
 
Income tax charged directly to accumulated OCI has been reclassified in the statement of changes in equity in order to present it as part of the same component of equity as the pre-tax items to which it relates. This change had no effect on total equity.
 
Note 4: Business combinations, divestments and other significant transactions
 
Six months ended June 30, 2010
 
There were no material business combinations, divestments or other significant transactions during the six months ended June 30, 2010.  The movements in goodwill during the period relate mainly to adjustments to the valuation of inventories acquired with the Monsanto sunflower business on August 31, 2009.
 
Year ended December 31, 2009
 
On May 1, 2009 Syngenta sold its 6.99 percent shareholding in Sakata Seeds Corp. for approximately US$46 million.
 
On August 31, 2009, Syngenta acquired from Monsanto its global hybrid sunflower seeds activities for a cash payment of US$160 million, which included certain rights to receive services during the post-acquisition transition period. The consideration paid for Monsanto’s sunflower business in Spain will be recognized as a prepayment and is subject to European Union competition authority approval for the transaction. Goodwill of US$58 million was provisionally recognized at June 30, 2010 (December 31, 2009: US$24 million). Results of a professional valuation of acquired land and buildings are still awaited and the valuation of acquired seed inventories is not yet finalized. The most important factor contributing to the recognition of this goodwill is the expected value of revenue and cost synergies and other benefits from combining the acquired businesses with those of Syngenta.
 
During 2009, Syngenta also acquired: the 32 percent remaining minority equity interest in Koipesol Semillas S.A; 100 percent of the shares of Circle One Global Inc., a US-based biological crop protection technology business; the remaining 50 percent of the shares of Goldsmith Seeds Europe B.V., the Netherlands-based business in which Goldsmith Seeds Inc., acquired in November 2008, had a 50 percent equity interest, and 100 percent of the shares of Synergene Seed & Technology, Inc. (“Synergene”) and Pybas Vegetable Seed Co., Inc. (“Pybas”), two US-based lettuce seed companies. Cash paid for the above acquisitions, excluding the Monsanto sunflower business, was US$35 million and goodwill of US$15 million was recognized at June 30, 2010, (December 31, 2009: US$ nil), which includes provisional amounts in respect of Synergene and Pybas.

 
Syngenta - July 22, 2010/Page 19 of 41

 
 
Movements in goodwill
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009
 
Cost:
           
January 1
    1,617       1,559  
Additions from business combinations
    53       4  
Currency translation effects
    (16 )     (2 )
June 30
    1,654       1,561  
                 
Accumulated amortization and impairment losses:
               
January 1
    322       318  
Currency translation effects
    (5 )     (1 )
June 30
    317       317  
Net book value, June 30
    1,337       1,244  

 
Syngenta - July 22, 2010/Page 20 of 41

 
 
Note 5: Segmental information
 
 
Syngenta is organized on a worldwide basis into three reportable segments: Crop Protection, Seeds and Business Development.  No operating segments have been aggregated to form the above reportable operating segments.

For the six months ended June 30, 2010
(US$ million)
 
Crop
Protection
   
Seeds
   
Business Development
   
Elimination(1)
   
Total
 
Segment sales – third party
    4,972       1,763       5       -       6,740  
Segment sales – other segments
    24       -       -       (24 )     -  
Segment sales
    4,996       1,763       5       (24 )     6,740  
Cost of goods sold
    (2,357 )     (946 )     (2 )     60       (3,245 )
Gross profit
    2,639       817       3       36       3,495  
Marketing and distribution
    (619 )     (281 )     (3 )     -       (903 )
Research and development
    (275 )     (200 )     (32 )     -       (507 )
General and administrative
    (342 )     (94 )     (7 )     -       (443 )
Restructuring and impairment
    (42 )     (35 )     (7 )     -       (84 )
Operating income/(loss)
    1,361       207       (46 )     36       1,558  
Income from associates and joint ventures
                                    21  
Financial expense, net
                                    (55 )
Income before taxes
                                    1,524  

For the six months ended June 30, 2009(a)
(US$ million)
 
Crop
Protection
   
Seeds
   
Business Development
   
Elimination(1)
   
Total
 
Segment sales – third party
    4,974       1,676       5       -       6,655  
Segment sales – other segments
    26       -       -       (26 )     -  
Segment sales
    5,000       1,676       5       (26 )     6,655  
Cost of goods sold
    (2,343 )     (910 )     (1 )     46       (3,208 )
Gross profit
    2,657       766       4       20       3,447  
Marketing and distribution
    (556 )     (276 )     (4 )     -       (836 )
Research and development
    (237 )     (173 )     (34 )     -       (444 )
General and administrative
    (256 )     (69 )     (10 )     -       (335 )
Restructuring and impairment
    (28 )     (23 )     2       -       (49 )
Operating income/(loss)
    1,580       225       (42 )     20       1,783  
Income from associates and joint ventures
                                    2  
Financial expense, net
                                    (46 )
Income before taxes
                                    1,739  
 
All amounts relate to continuing operations.
 
(a) After effect of accounting policy change for post-employment benefits described in Note 3.
(1) Intersegment elimination.
 
 
Syngenta - July 22, 2010/Page 21 of 41

 
 
Note 6: General and administrative
 
General and administrative includes gains of US$1 million (2009: US$19 million) on disposals of property, plant and equipment and subsidiaries and losses of US$24 million (2009: gains of US$23 million) on cash flow hedges reclassified from other comprehensive income in connection with the income statement recognition of the related hedged transactions.
 
Note 7: Restructuring and impairment before taxes
 
For the six months ended June 30,
           
(US$ million)
 
2010
   
2009
 
Non-cash restructuring and impairment, net
    31       5  
Cash costs:
               
Operational efficiency programs
    53       33  
Integration and acquisition costs
    10       12  
Total cash costs
    63       45  
Total restructuring and impairment
    94       50  
 
Restructuring represents the effect on reported performance of initiating business changes which are considered major and which, in the opinion of management, will have a material effect on the nature and focus of Syngenta's operations, and therefore requires separate disclosure to provide a more thorough understanding of business performance.  Restructuring includes the effects of completing and integrating significant business combinations and divestments.  Restructuring and impairment includes the impairment costs associated with major restructuring and also impairment losses and reversals of impairment losses resulting from major changes in the markets in which reported segments operate.
 
The incidence of these business changes may be periodic and the effect on reported performance of initiating them will vary from period to period.  Because each such business change is different in nature and scope, there will be little continuity in the detailed composition and size of the reported amounts which affect performance in successive periods.  Separate disclosure of these amounts facilitates the understanding of performance including and excluding items affecting comparability.  Syngenta’s definition of restructuring and impairment may not be comparable to similarly titled line items in financial statements of other companies.
 
Six months ended June 30, 2010
 
Charges for the Operational Efficiency programs were US$26 million for Crop Protection and US$27 million for Seeds and consisted of US$34 million for continuing standardization and consolidation of back office operations, US$7 million for further outsourcing of information systems, and US$12 million of other charges, including costs to realize synergies in the Seeds business following the acquisitions in Flowers during 2007 to 2009.
 
US$10 million of integration and acquisition costs were incurred relating mainly to the Goldsmith, Monsanto and Yoder acquisitions.
 
Non-cash restructuring and impairment, net includes US$13 million of impairment of a site disposal receivable and US$3 million of impairment of a site, both relating to sites in the UK, US$5 million of impairments of available-for-sale investments and US$10 million for the reversal of inventory-step-ups on acquisitions, which are included within cost of goods sold.
 
Six months ended June 30, 2009
 
Charges for the Operational Efficiency programs were US$19 million for Crop Protection and US$14 million for Seeds and consisted of US$21 million for continuing standardization and
 
 
Syngenta - July 22, 2010/Page 22 of 41

 
 
consolidation of back office operations, US$9 million for further outsourcing of information systems, and US$3 million of other charges.
 
US$12 million of integration and acquisition costs were incurred relating mainly to the Fischer and Goldsmith acquisitions.
 
Non-cash restructuring and impairment, net includes US$5 million of impairment of a site in the US, US$8 million of impairments of available-for-sale investments, net of US$10 million of recycling of gains on the disposal of Sakata Seeds Corp, and US$2 million of other non-cash restructuring costs of which US$1 million is for the reversal of inventory step-ups on acquisitions and is included within cost of goods sold.
 
Note 8: Non-cash items included in income before taxes
 
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009(a)
 
Depreciation, amortization and impairment of:
           
Property, plant and equipment
    135       117  
Intangible assets
    122       111  
Financial assets
    18       (2 )
Deferred revenue and gains
    (19 )     -  
Gain on disposal of non-current assets
    (1 )     (15 )
Charges in respect of share based compensation
    33       30  
Charges in respect of provisions
    67       37  
Financial expense, net
    55       46  
Losses/(gains) on hedges reported in operating income
    39       (10 )
Share of income from associates
    (21 )     (2 )
Total
    428       312  
 
(a)  
After effect of accounting policy change for post-employment benefit described in Note 3.
 
 
Syngenta - July 22, 2010/Page 23 of 41

 
 
 
Note 9: Principal currency translation rates
 
As an international business selling in over 100 countries and having major manufacturing and R&D facilities in Switzerland, the UK, the USA and India, movements in currencies impact Syngenta’s business performance.  The principal currencies and exchange rates against the US dollar used in preparing the condensed consolidated financial statements were as follows:
 
     
Average
                   
     
six months ended June 30,
   
June 30,
   
June 30,
   
December 31,
 
Per US$
   
2010
   
2009
   
2010
   
2009
   
2009
 
Brazilian real
BRL
    1.79       2.25       1.81       1.95       1.74  
Swiss franc
CHF
    1.08       1.12       1.08       1.08       1.03  
Euro
EUR
    0.74       0.75       0.82       0.71       0.69  
British pound
GBP
    0.65       0.68       0.67       0.60       0.62  
 
The average rates presented above are an average of the monthly rates used to prepare the condensed consolidated income and cash flow statements.  The period end rates were used for the preparation of the condensed consolidated balance sheet.
 
Note 10: Issuances, repurchases and repayments of debt and equity securities
 
Six months ended June 30, 2010
 
During the six months ended June 30, 2010 Syngenta repurchased 388,700 of its own shares at a cost of US$93 million, of which 100,000 shares will be used to meet the future requirements of share based payment plans and 288,700 shares relate to the share repurchase program announced in February 2010. No treasury shares were reissued except in accordance with Syngenta’s share based payment plans disclosed in Note 23 to its 2009 annual consolidated financial statements.
 
Six months ended June 30, 2009
 
In February and March 2009, Syngenta entered into forward contracts to purchase a total of 550,000 of its own shares for settlement in September and October 2009 at fixed prices in CHF equivalent to US$121 million at the June 30, 2009 exchange rate. Shares acquired will be used to meet the future requirements of share based payment plans.  No treasury shares were reissued except in accordance with Syngenta’s share based payment plans.
 
In June 2009, Syngenta issued a Eurobond with a principal amount of EUR500 million, a maturity of June 2014 and a coupon rate of 4.0 percent.
 
 
Syngenta - July 22, 2010/Page 24 of 41

 

 
Note 11: Commitments and contingencies
 
(US$ million)
 
June 30,
2010
   
December 31,
2009
 
Commitments for the purchase of:
           
Property, plant and equipment
    57       65  
Raw materials
    1,740       2,038  
Other commitments
    305       307  
Total
    2,102       2,410  
 
On May 27, 2010, Syngenta announced that it had agreed to acquire the Maribo Seed sugar beet business from Nordic Sugar, a subsidiary of Nordzucker AG, for a consideration of EUR43 million (US$53 million at June 30, 2010 exchange rates) on a cash and debt free basis plus EUR5 million (US$6 million) contingent payments. This transaction includes the seed production and sales activities of Maribo Seed as well as the Maribo brand name, and is subject to the approval of regulatory authorities.
 
Note 12: Subsequent events
 
No events occurred between the balance sheet date and the date on which these condensed consolidated financial statements were approved by the Board of Directors that would require adjustment to or disclosure in the condensed consolidated financial statements.
 
 
Syngenta - July 22, 2010/Page 25 of 41

 

 
Supplementary Financial Information
 
2009 supplementary financial information is presented after the effect of the change in accounting policy for actuarial gains and losses described in Note 3 to Syngenta’s Interim Condensed Consolidated Financial Statements (see also Appendix H on page 35).
 
Financial Summary
 
   
Ex Restructuring
& impairment(1)
   
Restructuring &
impairment
   
As reported under
IFRS
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009
   
2010
   
2009
   
2010
   
2009
 
Sales
    6,740       6,655       -       -       6,740       6,655  
Gross profit
    3,505       3,448       (10 )     (1 )     3,495       3,447  
Marketing and distribution
    (903 )     (836 )     -       -       (903 )     (836 )
Research and development
    (507 )     (444 )     -       -       (507 )     (444 )
General and administrative
    (443 )     (335 )     -       -       (443 )     (335 )
Restructuring and impairment
    -       -       (84 )     (49 )     (84 )     (49 )
Operating income
    1,652       1,833       (94 )     (50 )     1,558       1,783  
Income before taxes
    1,618       1,789       (94 )     (50 )     1,524       1,739  
Income tax expense
    (306 )     (341 )     41       12       (265 )     (329 )
Net income
    1,312       1,448       (53 )     (38 )     1,259       1,410  
Attributable to non-controlling interests
    5       8       -       -       5       8  
Attributable to Syngenta AG shareholders:
    1,307       1,440       (53 )     (38 )     1,254       1,402  
Earnings/(loss) per share(2)
                                               
- basic
    $14.04       $15.45       $(0.57 )     $(0.40 )     $13.47       $15.05  
- diluted
    $13.95       $15.36       $(0.56 )     $(0.40 )     $13.39       $14.96  

   
2010
 
2009
 
2010 CER(3)
Gross profit margin excl. restructuring & impairment
    52.0 %     51.8 %     51.7 %
EBITDA(4)
    1,927       2,058          
EBITDA margin
    28.6 %     30.9 %     28.9 %
Tax rate on results excl. restructuring & impairment
    19 %     19 %        
Free cash flow(5)
    74       79          
Trade working capital to sales(6)
    43 %     44 %        
Debt/Equity gearing(7)
    36 %     35 %        
Net debt(7)
    2,455       2,203          
 
(1)  
For further analysis of restructuring and impairment charges, see Note 7 on page 22.  Net income and earnings per share excluding restructuring and impairment are provided as additional information and not as an alternative to net income and earnings per share determined in accordance with IFRS.
 
(2)  
The weighted average number of ordinary shares in issue used to calculate the earnings per share were as follows:  For 2010 basic EPS 93,075,102 and diluted 93,660,855; for 2009 basic EPS 93,179,087 and diluted EPS 93,758,202.
 
(3)  
For a description of CER see Appendix A on page 30.
 
(4)  
EBITDA is defined in Appendix B on page 30.
 
(5)  
For a description of free cash flow, see Appendix E on page 33.
 
(6)  
Period end trade working capital as a percentage of twelve-month sales, see Appendix F on page 33.
 
(7)  
For a description of net debt and the calculation of debt/equity gearing, see Appendix G on page 34.
 
 
Syngenta - July 22, 2010/Page 26 of 41

 
 
Half Year Segmental Results excluding Restructuring and Impairment
 
Syngenta
 
For the six months ended June 30,
 
(US$ million)
 
2010
   
2009
   
CER %
 
Third party sales
    6,740       6,655       - 3  
Gross profit
    3,505       3,448       - 3  
Marketing and distribution
    (903 )     (836 )     - 5  
Research and development
    (507 )     (444 )     - 11  
General and administrative
    (443 )     (335 )     - 13  
Operating income
    1,652       1,833       - 13  
EBITDA(1)
    1,927       2,058       - 9  
EBITDA (%)
    28.6       30.9          
                         
Crop Protection
(US$ million)
                       
Total sales
    4,996       5,000       - 4  
Inter-segment elimination
    (24 )     (26 )     n/a  
Third party sales
    4,972       4,974       - 4  
Gross profit
    2,639       2,657       - 6  
Marketing and distribution
    (619 )     (556 )     - 8  
Research and development
    (275 )     (237 )     - 12  
General and administrative
    (342 )     (256 )     - 10  
Operating income
    1,403       1,608       - 16  
EBITDA(1)
    1,573       1,758       - 13  
EBITDA (%)
    31.5       35.2          
                         
Seeds
(US$ million)
                       
Third party sales
    1,763       1,676       + 2  
Gross profit
    827       767       + 5  
Marketing and distribution
    (281 )     (276 )     + 1  
Research and development
    (200 )     (173 )     - 14  
General and administrative
    (94 )     (69 )     - 32  
Operating income
    252       249       - 2  
EBITDA(1)
    352       320       + 7  
EBITDA (%)
    20.0       19.1          
                         
Business Development
(US$ million)
                       
Third party sales
    5       5       - 4  
Gross profit
    3       4       - 3  
Marketing and distribution
    (3 )     (4 )     + 17  
Research and development
    (32 )     (34 )     + 8  
General and administrative
    (7 )     (10 )     + 29  
Operating (loss)
    (39 )     (44 )     + 14  
EBITDA(1)
    (34 )     (40 )     + 18  
EBITDA (%)
    n/a       n/a          
 
(1)  
For a reconciliation of segment EBITDA to segment operating income, see Appendix D on page 32.
 
 
Syngenta - July 22, 2010/Page 27 of 41

 
 
Half Year Product Line and Regional Sales
 
Syngenta
 
For the six months ended June 30,
 
(US$ million)
 
2010
   
2009
   
Actual %
   
CER %
 
Crop Protection
    4,996       5,000       -       - 4  
Seeds
    1,763       1,676       + 5       + 2  
Business Development
    5       5       - 4       - 4  
Inter-segment elimination
    (24 )     (26 )     -       -  
Third party sales
    6,740       6,655       + 1       - 3  
                                 
Crop Protection
                               
Product line
                               
Selective Herbicides
    1,620       1,615       -       - 4  
Non-selective Herbicides
    548       691       - 21       - 25  
Fungicides
    1,488       1,356       + 10       + 6  
Insecticides
    700       673       + 4       -  
Seed Care
    369       392       - 6       - 10  
Professional Products
    242       225       + 7       + 4  
Others
    29       48       - 38       - 39  
Total
    4,996       5,000       -       - 4  
Regional
                               
Europe, Africa and Middle East
    1,790       1,810       - 1       - 5  
NAFTA
    1,662       1,882       - 12       - 15  
Latin America
    710       550       + 29       + 29  
Asia Pacific
    834       758       + 10       + 2  
Total
    4,996       5,000       -       - 4  
                                 
Seeds
                               
Product line
                               
Corn and Soybean
    806       843       - 4       - 7  
Diverse Field Crops
    386       304       + 27       + 19  
Vegetables
    360       322       +12       + 9  
Flowers
    211       207       + 2       - 1  
Total
    1,763       1,676       + 5       + 2  
Regional
                               
Europe, Africa and Middle East
    762       659       + 16       + 9  
NAFTA
    826       880       - 6       - 7  
Latin America
    62       41       + 52       + 52  
Asia Pacific
    113       96       + 18       + 11  
Total
    1,763       1,676       + 5       + 2  

 
Syngenta - July 22, 2010/Page 28 of 41

 
 
Second Quarter Product Line and Regional Sales
 
Syngenta
 
2nd Quarter
             
(US$ million)
 
2010
   
2009
   
Actual %
   
CER %
 
Crop Protection
    2,486       2,415       + 3       -  
Seeds
    727       622       + 17       +14  
Business Development
    3       4       - 30       - 30  
Inter-segment elimination
    (4 )     (8 )     -       -  
Third party sales
    3,212       3,033       + 6       + 3  
                                 
Crop Protection
                               
Product line
                               
Selective Herbicides
    877       814       + 8       + 5  
Non-selective Herbicides
    316       362       - 13       - 16  
Fungicides
    681       634       + 7       + 5  
Insecticides
    349       318       + 10       + 8  
Seed Care
    130       135       - 4       - 6  
Professional Products
    122       115       + 6       + 4  
Others
    11       37       - 68       - 68  
Total
    2,486       2,415       + 3       -  
Regional
                               
Europe, Africa and Middle East
    831       823       + 1       -  
NAFTA
    942       989       - 5       - 8  
Latin America
    330       262       + 26       + 26  
Asia Pacific
    383       341       + 12       + 5  
Total
    2,486       2,415       + 3       -  
                                 
Seeds
                               
Product line
                               
Corn and Soybean
    253       213       + 19       + 16  
Diverse Field Crops
    193       155       + 24       + 19  
Vegetables
    200       180       + 11       + 11  
Flowers
    81       74       + 9       + 8  
Total
    727       622       + 17       + 14  
Regional
                               
Europe, Africa and Middle East
    297       251       + 18       + 15  
NAFTA
    329       300       + 9       + 8  
Latin America
    31       14       + 122       + 122  
Asia Pacific
    70       57       + 24       + 16  
Total
    727       622       + 17       + 14  

 
Syngenta - July 22, 2010/Page 29 of 41

 
 
Supplementary Financial Information
 
Appendix A: Constant exchange rates (CER)
 
Results in this report from one period to another period are, where appropriate, compared using constant exchange rates (CER).  To present that information, current period results for entities reporting in currencies other than US dollars are converted into US dollars at the prior period's exchange rates, rather than at the exchange rates for the current year.  CER margin percentages for gross profit and EBITDA are calculated by the ratio of these measures to sales after restating the measures and sales at prior period exchange rates.  The CER presentation indicates the underlying business performance before taking into account currency exchange fluctuations.
 
Appendix B: Reconciliation of EBITDA to net income
 
EBITDA is defined as earnings before interest, tax, non-controlling interests, depreciation, amortization, restructuring and impairment.  Information concerning EBITDA has been included as it is used by management and by investors as a supplementary measure of operating performance and is used by Syngenta as the basis of part of its employee incentive plans.  Management excludes restructuring from EBITDA in order to focus on results excluding items affecting comparability from one period to the next.  EBITDA is not a measure of cash liquidity or financial performance under generally accepted accounting principles and the EBITDA measures used by Syngenta may not be comparable to other similarly titled measures of other companies.  EBITDA should not be construed as an alternative to operating income or cash flow as determined in accordance with generally accepted accounting principles.
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009
 
Net income attributable to Syngenta AG shareholders
    1,254       1,402  
Non-controlling interests
    5       8  
Income tax expense
    265       329  
Financial expenses, net
    55       46  
Pre-tax restructuring and impairment
    94       50  
Depreciation, amortization and other impairment
    254       223  
EBITDA
    1,927       2,058  

 
Syngenta - July 22, 2010/Page 30 of 41

 
 
Appendix C: Segmental results and inter-segment elimination excluding restructuring and impairment
 
For the six months ended June 30, 2010
(US$ million)
 
Sales
   
Gross profit
   
Operating income
   
EBITDA
 
Crop Protection
    4,996       2,639       1,403       1,573  
Seeds
    1,763       827       252       352  
Business Development
    5       3       (39 )     (34 )
Total
    6,764       3,469       1,616       1,891  
Inter-segment elimination(1)
    (24 )     36       36       36  
Total 3rd party
    6,740       3,505       1,652       1,927  
                                 
For the six months ended June 30, 2009
(US$ million)
 
Sales
   
Gross profit
   
Operating income
   
EBITDA
 
Crop Protection
    5,000       2,657       1,608       1,758  
Seeds
    1,676       767       249       320  
Business Development
    5       4       (44 )     (40 )
Total
    6,681       3,428       1,813       2,038  
Inter-segment elimination(1)
    (26 )     20       20       20  
Total 3rd party
    6,655       3,448       1,833       2,058  
 
(1) Crop Protection inter-segment sales to Seeds.
 
 
Syngenta - July 22, 2010/Page 31 of 41

 
 
Appendix D: Reconciliation of segment EBITDA to segment operating income
 
For the six months ended June 30, 2010
(US$ million)
 
Crop Protection
   
Seeds
   
Business Development
   
Elimination(1)
   
Total
 
EBITDA
    1,573       352       (34 )     36       1,927  
Depreciation, amortization & impairment
    (167 )     (82 )     (5 )     -       (254 )
Income from associates & joint ventures
    (3 )     (18 )     -       -       (21 )
Operating income  excl. restructuring
& impairment
    1,403       252       (39 )     36       1,652  
Restructuring & impairment(2)
    (42 )     (45 )     (7 )             (94 )
Operating income
    1,361       207       (46 )     36       1,558  
                                         
For the six months ended June 30, 2009
(US$ million)
 
Crop Protection
   
Seeds
   
Business Development
   
Elimination(1)
   
Total
 
EBITDA
    1,758       320       (40 )     20       2,058  
Depreciation, amortization & impairment
    (155 )     (64 )     (4 )     -       (223 )
Income from associates & joint ventures
    5       (7 )     -       -       (2 )
Operating income  excl. restructuring
& impairment
    1,608       249       (44 )     20       1,833  
Restructuring & impairment(2)
    (28 )     (24 )     2               (50 )
Operating income
    1,580       225       (42 )     20       1,783  
 
(1)       Crop Protection inter-segment sales to Seeds.
 
(2)       Including reversal of inventory step-up included in Cost of goods sold.
 
 
Syngenta - July 22, 2010/Page 32 of 41

 
 
Appendix E: Free cash flow
 
Free cash flow comprises cash flow from operating activities, investing activities, excluding investments in and proceeds from marketable securities, and cash flows from acquisitions of non-controlling interests, which are included in financing activities.  Free cash flow is not a measure of financial performance under generally accepted accounting principles and the free cash flow measure used by Syngenta may not be comparable to similarly titled measures of other companies.  Free cash flow has been included as it is used by many investors as a useful supplementary measure of cash generation.
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009
 
Cash flow from operating activities
    321       359  
Cash flow used for investing activities
    (205 )     (275 )
Cash flow from marketable securities
    (30 )     (5 )
Cash flow used for acquisitions of non-controlling interests
    (12 )     -  
Free cash flow
    74       79  
 
Appendix F: Period end trade working capital
 
The following table provides detail of trade working capital for the periods ended June 30, 2010 and 2009 as a percentage of twelve-month sales:
 
(US$ million)
 
2010
 
2009
Inventories
    3,441     3,356
Trade accounts receivable
    4,197     4,245
Trade accounts payable
    (2,828)     (2,743)
Net trade working capital
    4,810     4,858
Twelve-month sales
    11,077     10,984
Trade working capital as percentage of sales (%)
    43 %     44 %
 
 
Syngenta - July 22, 2010/Page 33 of 41

 
 
Appendix G: Net debt reconciliation
 
Net debt comprises total debt net of related hedging derivatives, cash and cash equivalents and marketable securities.  Net debt is not a measure of financial position under generally accepted accounting principles and the net debt measure used by Syngenta may not be comparable to the similarly titled measure of other companies.  Net debt has been included as it is used by many investors as a useful measure of financial position and risk.  The following table provides a reconciliation of movements in net debt during the period:
 
For the six months ended June 30,
(US$ million)
 
2010
   
2009
 
Opening balance at January 1
    1,802       1,886  
Debt acquired with business acquisitions and other non-cash items
    126       (65 )
Foreign exchange effect on net debt
    4       (4 )
Purchase/(sale) of treasury shares
    73       (26 )
Dividends paid
    524       491  
Free cash flow
    (74 )     (79 )
Closing balance at June 30
    2,455       2,203  
                 
Components of closing balance:
               
Cash and cash equivalents
    (881 )     (1,765 )
Marketable securities(1)
    (16 )     (2 )
Current financial debt
    223       852  
Non-current financial debt(2)
    2,952       3,206  
Financing-related derivatives(3)
    177       (88 )
Closing balance at June 30
    2,455       2,203  
 
(1)  
Long-term marketable securities are included in Other non-current financial assets. Short-term marketable securities are included in Derivative and other current assets.
 
(2)  
Included within Financial debt and other non-current liabilities.
 
(3)  
Included within Derivative financial assets and Financial debt and other non-current liabilities.
 
The following table presents the derivation of the Debt/Equity gearing ratio at June 30, 2010 and 2009:
 
At June 30,
(US$ million)
 
2010
 
2009
Net debt
    2,455     2,203
Shareholders’ equity
    6,755     6,258
Debt/Equity gearing ratio (%)
    36 %     35 %
 
 
Syngenta - July 22, 2010/Page 34 of 41

 
 
Appendix H: Change in accounting policy for actuarial gains and losses
 
The effect of the change in accounting policy for actuarial gains and losses, as described in Note 3 to Syngenta’s Interim Condensed Consolidated Financial Statements, is set out in the following tables for the years ended December 31, 2009 and 2008:
 
Changes to Consolidated Income Statement
 
For the year ended December 31, 2009
(US$ million, except per share amounts)
 
2009
as reported
   
Immediate recognition
policy change
   
2009 after
policy change
 
Sales
    10,992       -       10,992  
Cost of goods sold
    (5,586 )     14       (5,572 )
Gross profit
    5,406       14       5,420  
Marketing and distribution
    (1,812 )     7       (1,805 )
Research and development
    (960 )     8       (952 )
General and administrative
    (738 )     24       (714 )
Restructuring and impairment
    (130 )     -       (130 )
Operating income
    1,766       53       1,819  
Income/(loss) from associates and joint ventures
    (3 )     -       (3 )
Financial expense, net
    (122 )     -       (122 )
Income before taxes
    1,641       53       1,694  
Income tax expense
    (267 )     (16 )     (283 )
Net income
    1,374       37       1,411  
Attributable to:
                       
Syngenta AG shareholders
    1,371       37       1,408  
Non-controlling interests
    3       -       3  
Net income
    1,374       37       1,411  
Earnings per share (US$):
                       
Basic earnings per share (US$)
    14.72       0.39       15.11  
Diluted earnings per share (US$)
    14.62       0.39       15.01  

 
Syngenta - July 22, 2010/Page 35 of 41

 
 
Changes to Consolidated Statement of Comprehensive Income
 
For the year ended December 31, 2009
(US$ million)
 
2009
as reported
   
Immediate recognition
policy change
   
2009 after
policy change
 
Net income
    1,374       37       1,411  
Components of other
comprehensive income:
                       
Actuarial gains/(losses)
    -       (98 )     (98 )
Unrealized gains/(losses) on available-for-sale financial assets
    (18 )     -       (18 )
Unrealized gains/(losses) on derivatives designated as cash flow and net investment hedges
    72       -       72  
Currency translation effects
    289       (29 )     260  
Income tax relating to OCI
    34       32       66  
Total comprehensive income
    1,751       (58 )     1,693  
Attributable to:
                       
Syngenta AG shareholders
    1,749       (58 )     1,691  
Non-controlling interests
    2       -       2  
Total comprehensive income
    1,751       (58 )     1,693  

 
Syngenta - July 22, 2010/Page 36 of 41

 
 
Changes to Condensed Consolidated Balance Sheet
 
At December 31, 2009
(US$ million)
 
2009
as reported
   
Immediate recognition
policy change
   
 2009 after
policy change
 
Assets
                 
Total current assets
    8,894       -       8,894  
Non-current assets:
                       
Deferred tax assets
    660       87       747  
Defined benefit pension asset
    679       (654 )     25  
Other non-current assets
    6,463       -       6,463  
Total non-current assets
    7,802       (567 )     7,235  
Total assets
    16,696       (567 )     16,129  
Liabilities and equity
                       
Current liabilities:
                       
Provisions
    (154 )     (60 )     (214 )
Other current liabilities
    (4,097 )     -       (4,097 )
Total current liabilities
    (4,251 )     (60 )     (4,311 )
Non-current liabilities:
                       
Deferred tax liabilities
    (884 )     196       (688 )
Provisions
    (879 )     (237 )     (1,116 )
Other liabilities
    (3,527 )     -       (3,527 )
Total non-current liabilities
    (5,290 )     (41 )     (5,331 )
Total liabilities
    (9,541 )     (101 )     (9,642 )
Equity:
                       
Shareholders’ equity
    (7,141 )     668       (6,473 )
Non-controlling interests
    (14 )     -       (14 )
Total equity
    (7,155 )     668       (6,487 )
Total liabilities and equity
    (16,696 )     567       (16,129 )
 
Changes to Consolidated Cash Flow Statement
 
For the year ended December 31, 2009
(US$ million)
 
2009
As reported
   
Immediate recognition policy change
   
2009 after policy change
 
Income before taxes
    1,641       53       1,694  
Reversal of non-cash items
    668       (53 )     615  
Cash flow from operating activities
    1,419       -       1,419  

 
Syngenta - July 22, 2010/Page 37 of 41

 
 
Changes to Consolidated Income Statement
 
For the year ended December 31, 2008
(US$ million, except per share amounts)
 
2008
as reported
   
Immediate recognition policy change
   
2008 after policy change
 
Sales
    11,624       -       11,624  
Cost of goods sold
    (5,713 )     7       (5,706 )
Gross profit
    5,911       7       5,918  
Marketing and distribution
    (2,039 )     6       (2,033 )
Research and development
    (969 )     5       (964 )
General and administrative
    (849 )     4       (845 )
Restructuring and impairment
    (196 )     -       (196 )
Operating income
    1,858       22       1,880  
Income/(loss) from associates and joint ventures
    3       -       3  
Financial expense, net
    (169 )     -       (169 )
Income before taxes
    1,692       22       1,714  
Income tax expense
    (307 )     (8 )     (315 )
Net income
    1,385       14       1,399  
Attributable to:
                       
Syngenta AG shareholders
    1,385       14       1,399  
Non-controlling interests
    -       -       -  
Net income
    1,385       14       1,399  
Earnings per share (US$):
                       
Basic earnings per share (US$)
    14.75       0.15       14.90  
Diluted earnings per share (US$)
    14.63       0.14       14.77  
 
Changes to Consolidated Statement of Comprehensive Income
 
For the year ended December 31, 2008
(US$ million)
 
2008
as reported
   
Immediate recognition
policy change
   
2008 after
policy change
 
Net income
    1,385       14       1,399  
Components of other
comprehensive income:
                       
Actuarial gains/(losses)
    -       (335 )     (335 )
Unrealized gains/(losses) on available-for-sale financial assets
    9       -       9  
Unrealized gains/(losses) on derivativesdesignated as cash flow and netinvestment hedges
    (34 )     -       (34 )
Currency translation effects
    (443 )     28       (415 )
Income tax relating to OCI
    (26 )     94       68  
Total comprehensive income
    891       (199 )     692  
Attributable to:
                       
Syngenta AG shareholders
    890       (199 )     691  
Non-controlling interests
    1       -       1  
Total comprehensive income
    891       (199 )     692  

 
Syngenta - July 22, 2010/Page 38 of 41

 
 
Changes to condensed Consolidated Balance Sheet
 
For the year ended December 31, 2008
(US$ million)
 
2008
as reported
   
Immediate recognition
policy change
   
2008 after
policy change
 
Assets
                 
Total current assets
    7,620       -       7,620  
Non-current assets:
                       
Deferred tax assets
    514       107       621  
Defined benefit pension asset
    628       (602 )     26  
Other non-current assets
    5,822       -       5,822  
Total non-current assets
    6,964       (495 )     6,469  
Total assets
    14,584       (495 )     14,089  
Liabilities and equity
                       
Current liabilities:
                       
Provisions
    (170 )     (75 )     (245 )
Other liabilities
    (4,064 )     -       (4,064 )
Total current liabilities
    (4,234 )     (75 )     (4,309 )
Non-current liabilities:
                       
Deferred tax liabilities
    (659 )     151       (508 )
Provisions
    (921 )     (191 )     (1,112 )
Other liabilities
    (2,869 )     -       (2,869 )
Total non-current liabilities
    (4,449 )     (40 )     (4,489 )
Total liabilities
    (8,683 )     (115 )     (8,798 )
Equity:
                       
Shareholders’ equity
    (5,884 )     610       (5,274 )
Non-controlling interests
    (17 )     -       (17 )
Total equity
    (5,901 )     610       (5,291 )
Total liabilities and equity
    (14,584 )     495       (14,089 )
 
Changes to 2008 Consolidated Cash Flow Statement
 
For the year ended December 31, 2008
(US$ million)
 
2008
As reported
   
Immediate recognition policy change
   
2008 after policy change
 
Income before taxes
    1,692       22       1,714  
Reversal of non-cash items
    973       (22 )     951  
Cash flow from operating activities
    1,466       -       1,466  

 
Syngenta - July 22, 2010/Page 39 of 41

 
 
Glossary and Trademarks
 
 
All product or brand names included in this results statement are trademarks of, or licensed to, a Syngenta group company. For simplicity, sales are reported under the lead brand names, shown below, whereas some compounds are sold under several brand names to address separate market niches.
 
Selective Herbicides
 
APIRO®
novel grass weed herbicide for rice
AXIAL®
new cereal herbicide
BICEP® MAGNUM
broad spectrum pre-emergence herbicide for corn and sorghum
CALLISTO®
novel herbicide for flexible use on broad-leaved weeds for corn
DUAL® MAGNUM
grass weed killer for corn and soybeans
ENVOKE®
novel low-dose herbicide for cotton and sugar cane
FUSILADE®
grass weed killer for broad-leaf crops
LUMAX®
unique season-long grass and broad leaf weed control for corn
TOPIK®
post-emergence grass weed killer for wheat
Non-selective Herbicides
 
GRAMOXONE®
rapid, non-systemic burn-down of vegetation
TOUCHDOWN®
systemic total vegetation control
Fungicides
 
AMISTAR®
broad spectrum strobilurin for use on multiple crops
BRAVO®
broad spectrum fungicide for use on multiple crops
INVINSATM
pre-harvest protection for multiple crops from drought stress
REVUSTM
for use on potatoes, tomatoes, vines and vegetable crops
RIDOMIL GOLD®
systemic fungicide for use in vines, potatoes and vegetables
SCORE®
triazole fungicide for use in vegetables, fruits and rice
TILT®
broad spectrum triazole for use in cereals, bananas and peanuts
UNIX®
cereal and vine fungicide with unique mode of action
ALTO®
broad-spectrum triazole fungicide
PRIORI Xtra®
a fungicide from the AMISTAR® family
Insecticides
 
ACTARA®
second-generation neonicotinoid for controlling foliar and soil pests in multiple crops
DURIVOTM
broad spectrum, lower dose insecticide, controls resistant pests
FORCE®
unique pyrethroid controlling soil pests in corn
KARATE®
foliar pyrethroid offering broad spectrum insect control
PROCLAIM®
novel, low-dose insecticide for controlling lepidoptera in vegetables and cotton
VERTIMEC®
acaricide for use in fruits, vegetables and cotton
Seed Care/Prof. Products
 
AVICTA®
breakthrough nematode control seed treatment
CRUISER®
novel broad spectrum seed treatment  - neonicotinoid insecticide
DIVIDEND®
triazole seed treatment fungicide
HERITAGE®
strobilurin turf fungicide
ICON®
public health insecticide
IMPASSE®
termite barrier
MAXIM®
broad spectrum seed treatment fungicide
INVINSATM
a new tool to manage heat and drought stress
FAFARD®
global brand for growing media
Field Crops
 
AGRISURETM
new corn trait choices
AGRISURE VIPTERATM
trait which provides broad spectrum insect control in corn
GARST®
US brand for corn and soybean
GOLDEN HARVEST®
brand for corn and soybean in North America and Europe
HILLESHÖG®
global brand for sugar beet
NK®
global brand for corn, oilseeds and other field crops
Vegetables and Flowers
 
DULCINEATM
consumer produce brand for value-added fruits and vegetables in North America
Fischer
Global premium flowers brand
PUREHEARTTM
DULCINEA™ brand for ‘personal size’ seedless watermelon
ROGERS® vegetables
leading brand throughout the Americas
S&G® flowers
global brand for seeds and young plants
S&G® vegetables
leading brand in Europe, Africa and Asia
 
 
Syngenta - July 22, 2010/Page 40 of 41

 
 
Addresses for Correspondence
 
Swiss Depositary
Depositary for ADRs
Registered Office
     
SEGA Aktienregister AG
The Bank of New York
Syngenta AG
P.O. Box
Shareholder Relations
Schwarzwaldallee 215
CH-4601 Olten
PO Box 11258
4058 Basel
 
Church Street Station
Switzerland
 
New York, NY 10286
 
     
Tel: +41 (0)62 205 3695
Tel: +1 (212) 815 6917
Tel: +41 (0)61 323 1111
 
Cautionary Statement Regarding Forward-Looking Statements
 
 
This document contains forward-looking statements, which can be identified by terminology such as ‘expect’, ‘would’, ‘will’, ‘potential’, ‘plans’, ‘prospects’, ‘estimated’, ‘aiming’, ‘on track’ and similar expressions. Such statements may be subject to risks and uncertainties that could cause the actual results to differ materially from these statements. We refer you to Syngenta's publicly available filings with the U.S. Securities and Exchange Commission for information about these and other risks and uncertainties. Syngenta assumes no obligation to update forward-looking statements to reflect actual results, changed assumptions or other factors. This document does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer, to purchase or subscribe for any ordinary shares in Syngenta AG, or Syngenta ADSs, nor shall it form the basis of, or be relied on in connection with, any contract therefor.
 
 Syngenta - July 22, 2010/Page 41 of 41

 
 

 

SIGNATURES

 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
   
SYNGENTA AG
 
 
Date:
July 22, 2010
 
By:
/s/ Tobias Meili
 
       
Name:
Tobias Meili
 
        Title: Head Corporate Legal Affairs  
             
             
             
     
By:
/s/ Brigitte Benz
 
       
Name:
Brigitte Benz
 
     
 
Title:
Deputy Head Shareholder Services & Group Administration