Archive | Enterprise

The Coca-Cola Company Announces 55th Consecutive Annual Dividend Increase

The board of directors of The Coca-Cola Company has approved the company’s 55th consecutive annual dividend increase, raising the quarterly dividend 6 percent from 35 cents to 37 cents per common share. This is equivalent to an annual dividend of $1.48 per share, up from $1.40 per share in 2016. The first quarterly dividend is payable April 3, 2017, to shareowners of record as of March 15, 2017.

The increase reflects the board’s confidence in the company’s long-term cash flow. The world’s largest beverage company returned $6 billion in dividends to shareowners in 2016, bringing to $35 billion the total amount given back to shareowners through dividends since January 1, 2010.

Led by Coca-Cola, one of the world’s most valuable and recognizable brands, the company’s portfolio features 20 billion-dollar brands, 18 of which are available in reduced-, low- or no-calorie options. The billion-dollar brands include Diet Coke, Coca-Cola Zero, Fanta, Sprite, Dasani, vitaminwater, Powerade, Minute Maid, Simply, Del Valle, Georgia and Gold Peak.

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The Seed Fund Opens For Entry to Fledgling Food and Drink Businesses Across the UK

Seeking food and drink’s entrepreneurial stars of tomorrow, The Seed Fund has announced that its annual competition is open for entries from Wednesday 1 February. A philanthropic organisation, which nurtures small and start up food and drink businesses, The Seed Fund is in its fourth year of activity.

Extending its reach across the UK in 2017, The Seed Fund offers support and mentoring from over 30 industry professionals and business leaders. Twelve shortlisted companies will be offered places on The Seed Fund Academy – which runs over a number of days, during the summer months. The winning companies can attend seminars, workshops, one-on-one sessions with mentors, industry visits and meet the buyer events. One eventual winner will then be announced at the Great Taste Golden Fork Awards Dinner in September, receiving a further year of support worth over £100,000.

Founded in 2013 by Bristol-based design and marketing consultancy, The Collaborators, The Seed Fund has recently announced a new partnership with Great Taste, the world’s most coveted blind-tasted food awards. United by a shared commitment to supporting up-and-coming food businesses, the partnership will offer Great Taste award-winning small producers the opportunity to qualify for the Fund.

Open to anyone who has been trading for under four years, from small food businesses with an appetite for growth to inspired individuals with a big idea, The Seed Fund will name its class of 2017 at the end of March.

Won by Adam’s Raw Chocolate in 2016, the final prize offers support and brand development, including access to branding and communications resources from The Collaborators and on-going advice from other industry experts and mentors.

The Seed Fund will be open for entry from Wednesday 1 February until Thursday 16 March. To apply, visit www.theseedfund.co.uk. For information about ways to support The Seed Fund, including sponsorship opportunities, email info@theseedfund.co.uk.

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Clive Black Joins the Coriolis Advisory Board

Clive Black, one of the UK’s top Consumer Analysts, has joined the Advisory Board of Coriolis, a global provider of expertise and experience in the delivery of business transformation to the FMCG sector. Coriolis, which operates globally from offices in Nottingham, UK and Sydney, Australia, has sought to reinforce its understanding of the rapidly moving FMCG marketplace through the appointment of respected advisors, of whom Clive Black is the first.

Mark Dudley, Chairman of Coriolis, says: “Clive’s knowledge and understanding of our markets and the forces that drive them is second to none. I welcome his appointment and look forward to his valued input on how Coriolis can deliver even greater value to our clients.”

Dr Clive Black.

Dr Clive Black, who is Head of Research for Shore Capital, comments: “Coriolis is a tremendously well-respected and renowned advisory business that continues to add recurring value to advanced companies across the world. It is a great privilege to be asked to assist the group’s board on its development plans and I very much look forward to engaging with Mark and his expert team with the aspiration of contributing to further commercial progress.”

Coriolis provides expert advice to its clients with the aim of identifying and practically applying methods to achieve operational financial improvements. Since 1996, Coriolis has advised its diverse client base on a range of issues across the operations spectrum from capacity, cost base and operational footprint, to engineering, reliability, capital projects and supply chain. Among its clients, Coriolis counts some of the biggest names in international FMCG operations including: Associated British Foods, Dairy Crest, Samworth Bros and Lion Co.

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Walsh Mushrooms Acquires Golden Mushrooms in Positive Move For Irish Mushroom Industry

Walsh Mushrooms Group has acquired the business and assets of Golden Mushrooms, one of Ireland’s top mushroom growers. Walsh Mushrooms Group is the second largest mushroom supplier to the UK marketplace, with operations in Ireland and the UK in compost manufacture, mushroom growing, marketing and distribution. The move, which comes amid on-going volatility in the sector in the wake of Brexit, can be seen as a significant show of confidence in the future of the Irish mushroom industry.

Walsh Mushrooms Group currently markets over 26,000 tonnes of mushrooms per annum accounting for over 15% of the total UK mushroom market. The acquisition brings total group employee numbers to 380 people across four sites in Ireland and the UK and boosts the groups own production capability to 140 tonnes of mushrooms per week.

Padraic O’Leary, managing director of Walsh Mushrooms, comments: “The last seven months have certainly been incredibly difficult but we are confident that the sector will overcome the challenge created by Brexit. The fact is that mushrooms are the second largest vegetable category in the UK, yet the market is not self-sufficient and needs to import 50% of their mushroom requirement. A long-standing, strong relationship exists between our markets and we are confident that ultimately the UK will return a more sustainable price for Irish mushrooms reflecting the new, post Brexit, foreign exchange rates.”

Founded by Michael and Marian Bergin, Golden Mushrooms began operating on a site outside the village of Golden in Tipperary in 1998 and quickly grew to become a significant producer in the Irish market employing 90 people and achieving turnover of over €5 million.  The business will continue trading as Walsh Mushrooms Golden Ltd.

Founder of Golden Mushrooms, Michael Bergin says: “We are proud to have grown a successful business from scratch and are delighted to see it, and our loyal employees, continue to operate under the new ownership of Walsh Mushrooms Group. We have worked closely with Walsh Mushrooms Group for the last 15 years and greatly respect their continued support and confidence in the Irish mushroom industry.”

Padraic O’Leary adds: “We believe that this acquisition will serve to further strengthen the Walsh Mushrooms Group, building on our recent significant investments in our production and packaging facilities in the UK. Golden Mushrooms has grown into a successful business over the last 18 years and we have long admired the production facilities and staff. Their strong commitment to sustainability, with the presence of a biomass facility on site, was key for us and strongly aligns with our group environmental policy.”

Walsh Mushrooms Group was founded in Gorey, County Wexford in 1979 and now operates across four sites in Ireland and the UK including the newly acquired mushroom production facility in Golden, County Tipperary; a compost manufacturing facility in Gorey, County Wexford; a mushroom production facility in Suffolk; and a packing and labelling facility near Evesham in Worcestershire, UK. For further information visit www.walshmushrooms.com.

CAPTION:

Pictured (left to right): Vitali Shastak, production manager at Walsh Mushrooms Golden, and Padraic O’Leary, managing director of Walsh Mushrooms.

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Brexit and Alcohol Bill Create Huge Challenge For Irish Drinks Sector

An economic study has found that the combination of a hard Brexit and the Public Health Alcohol Bill (PHAB) will create the perfect storm for the drinks sector, which is the powerhouse of the Irish Agri-Food and Drinks industry. The Alcohol Beverage Federation of Ireland (ABFI), which represents brewers, distillers, brand owners and distributors is calling on the Government to put in place a series of policy measures to mitigate against the risks of Brexit and reduce the unintended consequences of some of the policy measures contained in the PHAB.

The economic impact study was commissioned by ABFI, sets out a series of detailed recommendations and policy measures for the Government to introduce to protect the industry from the combined threat of Brexit and the Public Health Alcohol Bill. The sector is an economic success story with beverage exports of €1.4 billion to 139 markets in 2015  as well as supporting over  200,000 jobs in the wider drinks and  hospitality sector. With an annual wage bill of over €4 billion, it is a hugely important part of the Irish Food and Drinks sector.

The UK is Ireland’s biggest export market for food and drink with exports of €4.5bn in 2015. The result of the UK Brexit vote and subsequent sterling devaluation has led to a surge in cross border shopping, increased prices of Irish products and has increased the cost of Ireland as a tourist destination.

Economist Ciaran Fitzgerald.

ABFI is calling on the Government to introduce a range of policy measures in the medium term to enable the sector to offset the risks posed by Brexit and the PHAB. The Government should:

  • Cut excise duty. Ireland has the most expensive alcohol in the EU which penalises consumers, impacts tourism and negatively impacts the sector’s economic contribution.
  • Reintroduce the ban on below cost selling to disincentives cross-border shopping and tackle alcohol misuse. 
  • Introduce tax and regulatory measures to incentivise companies in the food and drink sector that have huge Irish economy supply chains grow their businesses in the Republic of Ireland.
  • Not impose any additional costs on business, such as structural separation, additional advertising restrictions and health labels which will increase the cost of doing business in Ireland and effectively act as major barriers to nascent craft brewers and distillers.
  • Challenge EU State Aid rules to promote future trade with the UK.
  • Ensure all island geographic indicators for Irish Whiskey, Irish Cream, and Irish Poitín/Irish Poteen are protected and supported.
  • Assist the food and drinks sectors to diversify and gain market access to new markets.

The report’s author, agri-economist Ciaran Fitzgerald says: “Since the Brexit vote last June and the subsequent decline in the value of sterling, the food and drink sector in Ireland has faced enormous challenges in the short term, including a surge in cross border shopping.  In addition, measures proposed under the Public Health (Alcohol) Bill place will exacerbate pressure on a sector that employs 200,000 directly and indirectly. The outcome of Brexit negotiations remains unclear. However, it’s vital that the Government puts in place a series of policy measures which will support the sector, ensure it gains access to new markets, supports new entrants and protects the unique geographic indicators for Irish Whiskey, Irish Poitin and Irish cream that we share with the North.”

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EU Agri-food Exports Remain at Record Level

The monthly value of EU agri-food exports in November 2016 reached a new record level of €11.7 billion, which is €813 million higher than in November 2015. Considering a slight decrease in agri-food imports from third countries, the EU now has a trade surplus in agri-food products at €19 billion over 12 months.

Major gains in values over the 12-months period from December 2015 to November 2016 were achieved in agri-food exports to the USA (€ + 1.5 billion; +8%) and China (€ +1.1 billion; +11%). The pig meat sector is also confirming its recovery after testing times last year. Indeed, the highest increase in export value over the last 12 months was recorded for pork: €+1.3 billion which represents +34% compared to export values in the 12-months period one year ago.

This month’s report focuses on EU agri-food trade with Ecuador at the occasion of the provisional entry into force of the Protocol of Accession of Ecuador to the EU Trade Agreement with Colombia and Peru in January 2017. The EU is the third largest trading partner for the Andean countries.

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Piccolo Brand Joins New Female-led Funding Platform

Piccolo, the Med-inspired organic baby food brand that has successfully challenged its category with fresh flavours and artisan design, has been selected for the new crowd-funding initiative from AllBright – a unique funding platform committed to investing in and supporting female founders.

As a brand that already has two influential female investors, Jan Woods, former head of HR for Pepsi Co, and food campaigner Prue Leith; in addition to its own founder having herself invested in two start-ups led by women, the relationship with AllBright was a natural fit.

Piccolo’s founder, Cat Gazzoli (pictured) demonstrates an unfaltering drive to succeed. Starting the venture at her kitchen table less than two years ago, she has been on a phenomenal journey. Since hitting the shelves in April 2016, Piccolo has secured multi-national distribution across Asda and Waitrose stores, as well as achieving listings in Whole Foods Market, Planet Organic, Abel & Cole and Booths.

On track to hit its projected turnover of £2 million in its first year, Piccolo’s early success is credit to Cat’s entrepreneurial vision and passionate approach to business. Forging key partnerships has been fundamental in targeting the millennial parent and thanks to Cat’s personable nature she has secured relationships with Water Babies, the world’s biggest swim school, as well as being the first baby food brand ever to partner with the National Childbirth Trust, the UK’s largest parenting charity.

Government statistics reveal that 10% of women in the UK are considering starting their own business, but many need some extra help to get them going in what is widely recognised as a male dominated investor market. The statistics speak for themselves, with only 10% of all capital being invested in female-led businesses, and often aspiring businesswomen can find themselves overwhelmed by the sheer level of male dominance in this area. Cat Gazzoli was fortunate to have two fantastic female angels join her early on and now becoming one of Allbright’s debut campaigns she is firmly cementing her presence in the UK business scene.

Having been deemed outstanding during AllBright’s selection process Cat was clearly a great fit. Commenting on why AllBright was attracted to Cat, co-founder Debbie Wosskow says: “AllBright exists to unearth exceptional female talent. We invest in and support women with sound business ideas that are committed to driving change. Cat demonstrates all the qualities we are looking for and her business Piccolo, which has had a board of female investors since launch, is the perfect match for us.  Breaking into the fast moving consumer goods industry is no mean feat for any brand, but Cat has managed to succeed and scale in this marketplace whilst retaining Piccolo’s strong ethical values and commitment to giving back.”

Speaking about her involvement with Cat and Piccolo, Food campaigner Prue Leith says: “Cat Gazzolli is a force of nature. A good one. She is obsessed with good food, cooking and feeding children properly. I’ve worked with her for years, at Slow Food and the Food Education Foundation, which we started together. I’m generally wary of involvement with start-up food businesses, but I know Piccolo will succeed as long as Cat is at the helm. It’s a great concept, nutritious, delicious and ethical. I’m delighted to be involved.”

Cat adds: “Being one of AllBright’s debut campaigns is fantastic. The figures speak volumes with regards female founders and to be part of something which is so committed to supporting women in business is an honour. I certainly appreciate the support to help grow Piccolo. I don’t believe that you can start a brand now without thinking about what you want to give back, in fact this is a core part of Piccolo’s DNA. We commit 10% of our profits to food education so the better we do the more we can give back to the community.  AllBrights platform is a significant development for Piccolo to ensure we stay on track to succeed and truly make a difference in more ways than one.”

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Aon Launches ‘Brexit Navigator’

Aon plc, a risk and insurance adviser to clients across the food and drink sector, has launched Brexit Navigator, a bespoke and proprietary three step solution designed to help organisations quantify the impact of Brexit risk exposures, and redesign risk management and risk financing structures. Brexit Navigator is supported by an interactive tool that presents scenario-based insights for each of the EU Four Freedoms: Goods, Capital, Services and People, which help assess the impact of Brexit.

Grant Foster, Managing Director UK of Aon Global Risk Consulting, comments: “Extensive conversations with clients from different sectors and geographies over the past four months have given us a unique perspective on companies’ Brexit concerns.  These insights, combined with our deep and extensive expertise in risk advisory and solutions, have enabled us to develop Brexit Navigator.”

Brexit Navigator is a three step solution, suitable for organisations globally that have operations and business interests in the UK:

  • Baseline, step one – Evaluates just how Brexit-ready an organisation is, mapping out the potential risks and opportunities.
  • Balance, step two – Realigns the risk management and insurance programme to adapt to the new organisational risk tolerance and appetite.
  • Horizon, step three – Tests the changes introduced to an organisation’s programme to help ensure resilience for the future.

Eddie McLaughlin, Chief Commercial Officer EMEA, Aon Global Risk Consulting, says: “Brexit Navigator is a great example of what we do best at Aon; an innovative solution created by experts who have listened to what our clients need.  Like all emerging risks, the sooner an organisation can plan for an eventual outcome the better. Brexit Navigator will help clients measure and respond to risks and opportunities created by Brexit.”

To find out more about Brexit Navigator, view a short video and request a complimentary demo of our interactive tool, please visit: www.aon.com/BrexitNavigator.

Visit http://www.aon.com/brexit/ to access Brexit news, insights and materials from Aon.

 

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McDonald’s Sells Majority Stake in Chinese Business For $2.1 Billion

McDonald’s Corporation is selling a controlling interest in its businesses in mainland China and Hong Kong to CITIC, CITIC Capital Holdings and The Carlyle Group for up to $2.08 billion (HK$16.14 billion) in cash and new shares. After completion of the transaction, CITIC and CITIC Capital will have a controlling stake of 52%, while Carlyle and McDonald’s will have interests of 28% and 20%, respectively. The new partnership, which will be responsible for McDonald’s businesses in mainland China and Hong Kong for a term of 20 years, will become the largest McDonald’s franchisee outside the United States.

The partnership will use its combined expertise and resources to accelerate growth in McDonald’s business through new restaurant openings, particularly in tier 3 and 4 cities, and to improve sales performance in existing restaurants. The focus will be on key areas such as menu innovation, enhanced restaurant convenience, retail digital leadership and delivery. It intends to add over 1,500 restaurants in China and Hong Kong over the next five years.

Steve Easterbrook, chief executive of McDonalds’s, says: “China and Hong Kong represent an enormous growth opportunity for McDonald’s. This new partnership will combine one of the world’s most powerful brands and our unparalleled quality standards with partners who have an unmatched understanding of the local markets and bring enhanced capabilities and new partnerships, all with a proven record of success. By working together, we will unlock even faster growth and be closer to the customers and communities we serve as McDonald’s works to be the leading Quick Service Restaurant across the Chinese mainland and Hong Kong.”

China’s consumer sector is growing rapidly, benefiting from continued urbanisation, an expanding middle class and increasing disposable household incomes. China’s working population is larger than those of the US and Europe combined, yet spending levels of China’s middle class are a small fraction of those in more developed countries. As disposable incomes rise, people will continue to spend more on leisure and dining out, particularly in tier 3 and 4 cities where there is great growth potential. As such, the market for Western Quick Service Restaurants is expected to continue to grow rapidly.

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Further Success For Welsh Hills Bakery

Dedicated gluten and wheat free manufacturer, Welsh Hills Bakery, is preparing for orders to soar following Spanish airline, Vueling’s, announcement that it will increase its capacity on all of its services from Cardiff Airport by 16%. The Aberdare-based bakery, creator of the successful Lovemore Free From Foods, has a substantial contract to supply Vueling passengers with its Lovemore chocolate brownie until 2017. Following the announcement that Vueling will now begin a major expansion plan ahead of the summer next year when it will run up to five flights a week to Alicante and Malaga, and up to four flights a week to Barcelona and Palma Majorca, Welsh Hills Bakery will be increasing production of the 52g retail service packs of its chocolate brownie.

2016 has seen unprecedented success for the bakery, which started out in 1956 as a family run business. Still run by the same family, Welsh Hills Bakery is now an international brand exporting to the likes of America, Australia and the Middle East. In the last month, Welsh Hills has held discussions with a major retailer in Hubei Province in China and is looking set to begin exporting its Lovemore cookies and biscuits to the country in the second quarter of 2017.

Key Account Manager for Welsh Hills Bakery, Julian Cruttenden, says: “It’s a privilege to be working with Vueling and we congratulate them on their success. There is a growing number of people suffering with food intolerances such as coeliac disease and monitoring this while on holiday can be particularly difficult. To be able to have that choice of opting for a gluten and wheat free snack while on a flight will make all the difference to some people.”

The Lovemore range includes shortbreads, cookies, pies, tarts and slices and since last year, it has expanded into Finland, as well as opening up central Europe with Tesco. Welsh Hills Bakery employs 70 staff and supplies in excess of 80 product lines around the world. For more information visit www.lovemorefoods.com.

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€17.6 Million Strategic Research Partnership Between Origin Enterprises and University College Dublin

Origin Enterprises, the Irish agri-services group, and University College Dublin (UCD), Ireland’s largest university, have announced the establishment of a dedicated digital, precision agriculture and crop science collaborative research partnership, supported through the Science Foundation Ireland (‘SFI’) Strategic Partnership Programme. This is a €17.6 million five-year research programme.

The collaboration encompasses a strong multi and inter-disciplinary approach, combining the leading expertise of UCD in data science and agricultural science with Origin’s integrated crop management research, systems capabilities and extensive on-farm knowledge exchange networks.

A cornerstone of the partnership will be the creation of scalable, dynamic and integrated crop models which incorporate consistent and real-time data driven and data analytical approaches that optimise sustainable crop performance through enabling enhanced predictive intelligence capabilities at field level.

Origin’s Chief Executive Officer, Tom O’Mahony comments: “We are delighted to join forces and collaborate with UCD, a world-leading academic institution in agricultural science with excellent credentials in multi-disciplinary research. We are particularly pleased with the support of Science Foundation Ireland under its Strategic Partnership Programme, the aim of which is to foster and develop partnerships of scale.”

He adds: “The collaboration provides Origin with a development platform which accesses the very substantial intellectual capacity, advanced data analytics, sensing technologies and modelling resources of UCD.  The merging of conventional crop science and agronomic application with digital technology and prescriptive data analytics will enhance Origin’s knowledge-intensive offering along with improving the capacity to scale our service.”

Professor Orla Feely, UCD Vice-President for Research, Innovation and Impact, says: “This is a very exciting research partnership announced today between Origin and UCD, which will put Irish research at the forefront of new and innovative approaches for future farming systems. The multi-disciplinary research teams at UCD will use our research expertise in data science and agriculture, together with Origin’s industry experts, to address the issue of crop sustainability, a major global food security challenge.”

Professor Mark Ferguson, Director General, SFI and Chief Scientific Advisor to the Government of Ireland, says: “The SFI Strategic Partnership Programme supports unique research partnerships with strong potential for impact on the Irish economy. Investing in research that enhances the agri-food industry while protecting our natural resources is vital for Ireland’s future. Science Foundation Ireland is delighted to support this partnership between UCD and Origin. Combining the resources and expertise from these organisations will secure Ireland’s international position in the field of data-driven agriculture. The proposed integrated crop model will have global implications in the sustainable production of crops, addressing the challenge of food production for a rapidly expanding global population.”

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Pots & Co Named in ‘Ones to Watch’

Pots & Co, producers of Michelin-quality handmade puddings, has been named as one of ten ‘Ones to Watch’ in the 20th anniversary edition of The Sunday Times Virgin Fast Track 100, cementing its place as a key player in the UK grocery retail dessert category. The prestigious Fast Track Ones to Watch celebrates companies that are tipped for rapid future growth.

Pots & Co founder and CEO of the company, Julian Dyer, says: “We are absolutely delighted to be shortlisted for The Sunday Times Virgin Fast Track 100. It’s been a fantastic year for the company, which has seen us grow in the UK and further afield. In 2013 we turned over £150,000 – just three years later and our expected annual turnover is £10 million.”

Pots & Co recently announced its expansion across Europe with a sweep of international listings as demand for the decadent desserts grows in the continent. Pots & Co has listings throughout the UK in stores including Waitrose, Tesco, Harrods and Selfridges and has just extended its line with a new range made from non-dairy ingredients.

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Report Highlights Economic Importance of Scottish Red Meat Industry

The importance of red meat production to both the national economy of Scotland and the country’s rural areas, is very clearly highlighted in an independent new report commissioned by Quality Meat Scotland (QMS). The report, ‘An Assessment of the Economic Contribution of Scotland’s Red Meat Supply Chain’, reveals that the red meat supply chain in Scotland contributes around £2.4 billion to total output.

This equates to a £733 million contribution to Scotland’s Gross Domestic Product and provides employment totalling 33,000 jobs. The report also clearly lays out the Scottish red meat industry’s very considerable importance in terms of employment in rural areas through jobs created by farming and meat processing.

The report accounts for production as far along the red meat chain as abattoirs and cutting plants. The figures would be significantly higher if the economic impact further downstream, including the wholesalers and multiple and independent retailers plus food outlets were also included.

The publication, compiled by Dr Andrew Moxey of Pareto Consulting, reveals that red meat production accounts for around 40% of total farming output in Scotland. Overall cattle, sheep and pigs are found on around 20,000 holdings in Scotland of which over 14,300 are LFA specialist cattle and sheep holdings, around 2300 are non-LFA cattle and sheep holdings and nearly 300 are specialist pig holdings.

In Scotland there are around 30 livestock markets which have a collective throughput of 2.7 million animals, with a turnover of £525 million in 2014.

The 23 licensed red meat abattoirs in Scotland generated a collective output in 2014 worth an estimated £876 million. Sixty-eight percent of their total production is sold out of Scotland to the rest of the UK, with a further nine percent sold to overseas export markets.

The important economic role of the other businesses which support the industry is also very clear in the report. Livestock haulage accounts for 108 haulage firms operating 275 vehicles registered for carrying livestock. Additionally, 201 veterinary practices are registered for treating farm animals and there are 113 feed suppliers.

“As well as clearly laying out the way in which red meat production underpins Scotland’s agricultural output, the report also highlights the role it plays in social sustainability and in the maintenance of Scotland’s landscape,” says Iain Macdonald, Senior Economics Analyst, QMS.

The report also clearly identifies there are opportunities to increase the contribution the industry makes to Scotland’s economy.

“The main routes identified for achieving this include the retention of more animals in Scotland and the wider adoption of best practice at farm level,” says Iain Macdonald. “The other key opportunities identified for driving growth in our industry are greater collaboration and information sharing across the supply chain.”

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Gourmondo is Expanding

Gourmondo, the online distributor of delicatessen, wines, and speciality foods from around the world, is expanding its business by a further three European countries, bringing its total to five. Available in Germany since 2002 and the Netherlands since 2011, in summer 2016 the online delicatessen began offering delivery to Austria, the UK, and Ireland.

“Gourmondo offers top-quality culinary delights from outstanding producers with the most extraordinary products. We are delighted to be able to extend our premium range of over 17,000 products to Austria, the UK, and Ireland,” says Pascal Zier, managing director of Gourmondo. “Pre-selection, manufacturing processes, and the quality of the raw materials are Gourmondo’s top priority. To ensure that our customers receive their orders quickly and without hassle, we focus on excellent, reliable service: next-day deliveries on orders made before 4pm, as well as robust, and if necessary refrigerated, packaging, are just some examples of how we achieve this.”

In addition to exclusive champagnes, refined oils, cheeses, spices, and rare wines, Gourmondo’s range also includes refrigerated products such as top-quality meats, which are covered by the company’s “freshness promise”. Gourmondo attaches great importance to sourcing sustainable and regional products, and has been a proud supporter of Slow Food Deutschland e. V. since 2009. Gourmondo has also had organic certification in accordance with EU regulations since 2009. In Germany, Gourmondo operates organic supermarket chain Alnatura’s online store (Alnatura-shop.de).

When it comes to the logistical demands of the online food trade, Gourmondo is benefiting from its acquisition by Delticom in the spring of 2016. Delticom is one of Europe’s leading e-commerce companies. Founded in 1999, the Hanover-based company now has more than 300 online stores and websites in 41 countries. Delticom has built up its e-commerce expertise as an online dealer for tyres and car accessories, and is continually expanding this expertise in new areas and with new products.

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New Record in EU Agri-food Exports in September 2016

The monthly value of EU agri-food exports in September 2016 reached a record value of almost €11.5 billion exceeding the export values in September of previous years by about €500 million. Highest increases in monthly export values (September 2016 compared to September 2015) were recorded for the USA and Japan. Agri-food exports to other Asian countries also increased notably (South Korea, Vietnam, India, Hong Kong).

Analysing the EU export performance over the last 12 months per product category, export values increased in particular for pig meat (+€1.2 billion; +31% compared to export values in the 12-months period one year ago), fresh vegetables (+€480 million; +18%), meat offal, other meat and fat , olive oil, food preparations and live animals. However, exports of milk powders lost most in export values in the last 12 months.

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How Will ’Trumpenomics’ Affect the Irish Food Industry?

By John Whelan

By the time Trump is sworn in as President in January, the global food industry including those with a presence in Ireland will already have taken protective action to Trump proof their business. But will it be enough and as Trump describes himself as ‘totally flexible on very , very many issues’ the industry may still get it wrong as  the pre-election rhetoric may not be  transformed into actual policies. It is a time for agile leadership.

There is no doubting that Trump’s stance on free-trade will  have deep implications for the food and beverage sector, with a clear intent to protect jobs within the US: “As President, I will be an aggressive proponent for defending the economic interests of American workers and farmers on the world stage. I will fight against unfair trade deals and foreign trade practices that disadvantage the United States.”

Key Irish food groups such as Glanbia, Kerry Group, the Irish Dairy Board (Ornua ), Greencore and Aryzta  are extensively exposed to the US with  combined  sales revenues  estimated  at €6 billion last year in the market. Most exposed is Glanbia with 55% of its revenue in the US, Aryzta  is close behind with 49% of sales there, Ornua has also a strong presence giving rise to 40% of its revenue, Kerry Group  has a lower  exposure with 16% and Greencore ahead of their recent acquisition was least exposed with 15% of  revenue in the US.

IrishDistillersJamesonCompressedThe Greencore Group shareholders obviously see the timing of the recent acquisition of US foods group – Peakcock Foods – as very fortuitous timing by chief executive Patrick Coveney, with shares surging more than 12pc when announced. The $748m (€695m) deal will quadruple Greencore’s US sales, taking US revenue up to 42% of total group turnover.

However, as most of this sales revenue arises from factory facilities located  within the US, the directors and shareholders in these companies will feel relatively safe that they are meeting the ‘Trumpenomics’ current standards and will be protected and encouraged to expand there.

Conversely, for food and beverage companies manufacturing abroad and importing into the US, the situation looks set to get ugly. Coca Cola and Pepsi Cola, who manufacture the secret ingredient here in Ireland and then ship €1.6 billion of it to bottling plants across the US, may come under pressure to move all production back there. But also spirit producers such as Pernod Group, whose prime market for Jameson Whiskey is the US, could find themselves with even more pressure – perhaps bottling in the US may have to be envisaged to appease the protectionist regime. Ornua may also be a little concerned as they import butter from Ireland for some of the sales generated there, again packaging within the US may get them inside the protectionist tent.

ornuakerrygoldbutterfieldcompressedWhile production location challenges will continue to be of concern to food and drink makers for some time to come, there has been a welcome upside in the foreign currency markets. Contrary to expectations, currency markets did not shift to the traditional ‘safe havens’ of the Swiss Franc and Japanese Yen. Instead they have reflected favourably on the prospects of a Trump led Republican government  driving jobs and growth at home, pushing  the dollar back to its strongest since this time last year. With the expected Trump slump not materialising, companies who report their earnings in Euros have the added prospect of a  currency translation gain when they repatriate their profits. All of the large Irish food companies mentioned will be buoyed up with the rebound of the dollar and will be able to reflect a strong bottom line gain due to the currency translation when reporting the quarterly and annual accounts.

A continued strong dollar under the Trump administration will help offset expected losses by all these companies on the UK market from the Brexit debacle and the associated Sterling collapse.

However, the big losers from the Trump policies are likely to be the wide range of smaller food and beverage businesses who produce in Ireland and who have the US as the second largest market after the UK with exports growing to €755 million last year. They will be caught in the trade war that will inevitably follow the Trump administrations protectionist moves.

Posted in EnterpriseComments Off on How Will ’Trumpenomics’ Affect the Irish Food Industry?

UK Catering Firms to Overcome Brexit Uncertainty

The majority of UK catering companies are in surprisingly good shape to cope with any Brexit fallout, a new report from market analysts Plimsoll Publishing argues. Having carried out a financial health check on the UK’s 1477 top catering firms, the new report has found that 486 firms are performing well in current market conditions and are well prepared for any uncertainty in the sector.

Plimsoll’s senior analyst, David Pattison, says: “Much like how your doctor would check your health and recommend action, we have done the same with each of the UK’s top 1477 catering companies. Since the decision to leave the European Union, the market has been dogged with speculation and uncertainty. However our latest research suggests the majority of catering firms are surprisingly well placed. Having said that, however, that’s not to say there will not be an impact, but they are in good shape to cope and respond to any upheaval.”

The study has identified and analysed the vital areas of business performance that lead to success or failure. These factors have then been applied to the 1477 companies to highlight the fittest and those showing signs of serious financial weakness. Depending on the overall financial health, each company was given one of five health ratings:

  • 486 firms rated as Strong – these firms are the fittest in the industry and are showing strong financial health.
  • 129 firms rated as Good – these firms are improving financial health and can aspire to those rated Strong.
  • 174 firms rated as Mediocre –these firms could go either way, they need to fine-tune their business so they do not slip back and improve.
  • 174 firms rated as Caution – these firms are showing the early signs of weakness, early prevention measures need to be put in place.
  • 332 firms rated as Danger – These firms are showing a serious weakening in financial health, urgent plans are required to treat these weaknesses.

plimsolllogoDavid Pattison continues: “Nobody at this early stage will know the consequences of the Brexit vote, however companies who are rated as Danger have two options: they can hold their nerve and hope to trade their way out, or they can put a survival plan in place and look to consolidate their business. Once you take notice of the warning signs, then directors need to act.”

Copies of the report are available to buy by clicking here. Alternatively call Chris Glancey on 01642626419 or email chrisg@plimsoll.co.uk

Posted in Enterprise, Reports, ResearchComments Off on UK Catering Firms to Overcome Brexit Uncertainty

New Strategy to Double Size of Scotland’s £1.8 billion Aquaculture Sector

A group of leading businesses and organisations in Scotland’s aquaculture industry have come together for the first time to create an ambitious new growth strategy for the sector. The 2030 Aquaculture Strategy identifies key actions required to double the economic contribution of the industry from £1.8 billion in 2016, to £3.6 billion by 2030. It is estimated this will generate over 9,000 new jobs in the sector and establish Scotland as a global leader in the industry.

Aquaculture in Scotland is diverse, from the farming of salmon and other finfish species, to the production of mussels and oysters and the harvesting of seaweed. The industry is already a real success story in Scotland – salmon is the country’s top food export – however the new strategy seeks to unleash the sector’s full potential contribution to Scotland’s economy, environment and communities.

The strategy, developed after industry-wide consultation, sets out key recommendations for action by both the industry itself and government. The recommendations cover six themes: industry leadership; regulation; innovation; skills development; investment; and infrastructure. Amidst 20 specific recommendations, three are identified as critical to the sustainable growth of the industry:

scotlandfooddrinkaquaculturereport* The creation of a new industry leadership group to drive alignment between industry and government in order to deliver growth

* A restructure of the role of Marine Scotland – the government agency that regulates the sector – to maintain its regulatory role but to remove its industry development role

* The introduction world-leading innovation sites to trial cutting-edge equipment, technology and fish health strategies.

The Working Group that has produced the plan comprised representatives of the Scottish Salmon Producers Organisation, Scottish Aquaculture Innovation Centre, Scotland Food & Drink, Association of Scottish Shellfish Growers, Highland Council, as well as leading businesses in the sector: Aquascot, Gael Force Group, Ferguson Transport & Shipping and Wester Ross Salmon.

ScottishAquacultureStewart Graham, Group Managing Director of Gael Force Group and co-chair of the Working Group, comments: “This new strategy reflects the industry’s ambition to drive sustainable growth and for Scotland to be a world leader in aquaculture. We have developed a roadmap to 2030 which can make a transformational impact on Scotland’s economy and our rural communities.”

He adds: “However, the real work begins now and we want to forge a new partnership between the industry, government and its agencies to unlock the full potential of sustainably farming Scotland’s seas. The creation of a new Industry Leadership Group to reflect that collaborative partnership will be a critical first step. The strategy must act a catalyst to drive growth throughout the aquaculture supply chain through innovation, skills development and investment, and by ensuring we have proportionate and enabling regulation which balances economic growth and environmental sustainability.”

A copy of the strategy can be found here.

Posted in Enterprise, News, SustainabilityComments Off on New Strategy to Double Size of Scotland’s £1.8 billion Aquaculture Sector

Landmark New Irish Whiskey Mentoring Programme

The Irish Whiskey Association has launched a landmark new mentoring programme, which will bring established global players in the Irish whiskey industry together with new entrants to the market. The aim of this unique new mentoring programme is to ensure that new entrants to the category have access to the information and support they need to produce high quality Irish whiskey that global consumers expect.

The Irish whiskey market is the fastest growing spirits category in the world and has grown by an impressive 200% in the last decade. This unique programme will see established industry leaders mentor new entrants in the market and provide them with the necessary support and guidance to ensure the success not only of their new businesses but also the future and growth of the Irish whiskey category.  The programme kicked off with a workshop hosted by the Irish Whiskey Association where industry experts from a number of companies shared their knowledge on issues such as production, health and safety, licensing requirements, branding and route to market.

IrishWhiskeyAssociationLogoThe programme will consist of three further stages and participants will be able to access a new one stop shop online portal to help them plan their business. Stages 3 and 4 will focus on active mentoring where mentor companies such as Irish Distillers and Bushmills will be paired with new entrants. These stages will involve planning, design, construction and commissioning. The last stage will focus on production, highlighting the importance of ensuring that the high quality premium nature of the category is maintained.

Miriam Mooney, Head of the Irish Whiskey Association, says: “This is a unique programme which will see industry leaders support new market entrants and showcases the collegiality amongst industry and members of the Irish Whiskey Association. The mentor companies will share information, expertise and knowledge with new entrants enabling them to plan and succeed in the Irish whiskey business whilst at the same time upholding the integrity of the brand.”

Participant in the new mentoring programme, Bernard Walsh, Chairman of the Irish Whiskey Association and CEO of Walsh Distillery, says: “The Irish whiskey industry is at a pivotal moment in its history. We know that there is huge consumer appetite for our products globally, we only have to look across the water to Scotland with 108 distilleries in operation to see what’s possible. This initiative today is very welcome and the mentor companies are to be applauded for investing their expertise in new projects, to ensure high standards are maintained. For the industry to grow and compete internationally with scotch and bourbon products we cannot compromise on quality. The advice and support of industry experts is invaluable in helping companies navigate what can be difficult and complex issues.”

David Quinn, Technical Director, Irish Distillers, comments; “Irish Distillers are delighted to be taking part in what is an industry first and we look forward to working with new entrants to the sector to provide both advice and practical support. We all share a passion for creating a quality product and are committed to the protection of this globally recognised brand.”

Posted in Enterprise, News, Training & EducationComments Off on Landmark New Irish Whiskey Mentoring Programme

Innovative Self-priming Pump Does Double Duty For Dairies

By Allan Bruun, Industry Manager, Dairy, Market Unit Food, Alfa Laval

Are you looking for a self-priming pump that improves energy efficiency and reduces noise levels, as well as meeting the latest hygienic design standards? Using airscrew technology, the Alfa Laval LKH Prime sets a new standard in self-priming pump technology.

Based on the Alfa Laval LKH premium range of centrifugal pumps the Alfa Laval LKH Prime is specifically constructed for pumping liquids containing entrained air, making it an excellent choice as a CIP return pump. The Alfa Laval LKH Prime is 40 percent more energy efficient and operates at noise levels 80 percent below conventional liquid-ring pumps. As all pumps in the LKH family, the Alfa Laval LKH Prime is EHEDG certified and authorized to carry the 3-A symbol.

Versatile and efficient, the Alfa Laval LKH Prime is therefore of interest to dairy owners and operators who are concerned with:

  • Reducing energy consumption
  • Improving the work environment
  • Reducing installation costs.

Reducing Energy Consumption

alfalaval1october2016compressedThe hydraulic efficiency of the Alfa Laval LKH Prime reaches over 50% (Image 1). This means the Alfa Laval LKH Prime offers an added advantage over liquid-ring pumps, which typically reach efficiencies of approximately 30 percent. Its high efficiency is easily attainable at a wide flow range, which translates into substantial savings no matter the duty point.

Improving the Work Environment

The Alfa Laval LKH Prime also contributes to a better work environment. It reduces the noise emission level by up to 80 percent compared to conventional liquid-ring pumps. With a noise level of a mere 74dBA, the Alfa Laval LKH Prime efficiently eliminates the need for these protective measures.

Reducing Installation Costs

While the Alfa Laval LKH Prime is primarily designed for CIP return duties, the hygienic design means it may also be used to pump dairy products. For instance, the Alfa Laval LKH Prime is a reliable pump for emptying milk tanks. Because of the pump’s ability to handle both CIP return liquid and dairy products, it is possible to eliminate the need for a separate liquid-ring pump.

The Alfa Laval LKH Prime combines the gentle product treatment and hygienic design of the LKH range with the liquid-ring principle. In many cases, this can reduce the number of pumps required for an installation from two to just a single pump.

Reducing the installation costs from two liquid-ring pumps to one Alfa Laval LKH Prime pump results in:

  • Lower capital investment, one pump instead of two
  • Lower piping, cabling and automation costs
  • Lower spare parts and service costs.

Service is a key element of any Alfa Laval offering and the commonality of spares, including the shaft seal, in the LKH range translates into reduced spare parts inventory and fast maintenance.

Working Principle

As the pump starts up, a liquid ring is formed in the pump head canister (image 2) and the recirculation pipe is filled (2), thereby achieving the initial prime. This liquid ring is formed in the space between the diameter of the inlet pipe, and the outer diameter of the offset canister housing the airscrew. The resultant liquid ring creates a water seal between the airscrew hub and the top of the canister (3).

alfalaval2october2016compressedAn air column is created between the airscrew hub and the liquid ring (1). The air column is separated into air pockets by the airscrew and then forced into the impeller’s suction stage. Some of the priming liquid re-circulates over the recirculation pipe (2). Air is removed until the content is just a few percent and no pockets are generated. The pump then acts as a traditional centrifugal pump, transferring the liquid from the suction stage (4) through the discharge (5).

When there is no air present, the canister and recirculation loop have no function and are completely filled with liquid. The liquid passes through the canister into the impeller’s suction stage. Here again, the pump acts as a traditional centrifugal pump, transferring the liquid through the discharge at a higher velocity and pressure.

Summary

alfalaval3october2016compressedThe Alfa Laval LKH Prime Pump delivers:

  • Reduced energy consumption
  • Improved working environment
  • Reduced installation cost
  • And have spare parts commonality with the Alfa Laval LKH pump range making it easy to service.

Allan Bruun is Alfa Laval’s Dairy Industry Manager, responsible for the heat transfer and fluid handling business. Allan coordinates commercial and technical market intelligence between sales channels, dairies and central Alfa Laval functions seeking to optimize the customers’ processes and increase the competence level of the organization. Allan holds university degrees in mechanical and electrical engineering as well as business administration. Contact: allan.bruun@alfalaval.com.

About Alfa Laval

Alfa Laval’s worldwide organization works closely with customers in nearly 100 countries to help them stay ahead in the global arena. Alfa Laval is listed on Nasdaq OMX, and, in 2015, posted annual sales of about SEK 39.7 billion (approx.4.25 billion Euros). The company has about 17.500 employees.

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Bristol Brewery First to be Granted ‘CAMRA Says This Is Real Ale’ Accreditation For Canned Beer

moorbeercompanycansThe Campaign for Real Ale (CAMRA) has given its first ever accreditation for real ale to a canned beer – from Moor Beer Company in Bristol. The UK campaigning organisation carried out tests on the ‘micro-canned’ beer from Moor Beer at its recent Great British Beer Festival and concluded that the beer qualified as real ale under its definition.

CAMRA’s quality control laboratory at the Great British Beer Festival reported that the beer in Moor Beer cans still contained live yeast, and further test results showed that any carbonation was created by natural secondary fermentation. It makes Moor Beer the first brewery in the world to be granted the ‘CAMRA says this is real ale’ logo to use on a canned beer.

National chairman of CAMRA,Colin Valentine, says: “There have been a lot of developments in the brewing industry and CAMRA has been working hard to make sure that we understand them and how they fit with our real ale definition. I’m delighted that we’ve been able to show that ‘micro-canned’ beer under the right circumstances can qualify as real ale, which means that more drinkers can get access to what we believe is the pinnacle of brewing skill – live beer which continues to ferment and develop in whichever container it’s served from. We carried out similar tests on key-cask beers several years ago and accepted those as real ale and we’re hopeful brewers will continue to innovate and find ways of making real ale as accessible to drinkers as possible through these sorts of developments.”

CAMRALogoHe adds: “We look forward to granting the accreditation to many more breweries producing canned beers in similar ways to Justin at Moor.”

Justin Hawke from Moor Beer remarks: “I moved to England because of my love for real ale, so when I made the decision to can our beer there was only one way we were going to do it – fully can-conditioned with live yeast. We invested very heavily in our canning line and process control to get it right, taking a huge risk being the first to go down this path. Cans had a horrible reputation, but actually it is the best package type for portability because it blocks all light and oxygen from getting in and ruining the beer.”

Justin Hawke adds: “It is also a much more environmentally friendly container, being lighter in weight, more recyclable, and safer than glass. We worked really hard with our designer Ben King from Ich Bin Ben to make the outside of the can as awesome as the beer inside. The beer itself is amazing, and getting CAMRA’s recognition give us a huge sense of achievement.”

Posted in Enterprise, Ingredients, NewsComments Off on Bristol Brewery First to be Granted ‘CAMRA Says This Is Real Ale’ Accreditation For Canned Beer

Facing Up to Brexit and Price Deflation in the Food and Beverage Sector

By Ian Hunter, Senior Equity Analyst at Investec

Across our three main businesses in Investec Ireland (Corporate Treasury, Corporate Finance and Wealth & Investment), we have been working with clients to address the many challenges and opportunities thrown up by both BREXIT and deflation in food retail. Volatile currency markets pose real challenges in terms of competitiveness for exporters. Brexit has closed IPO markets for now and has led to tighter forward-financing markets, less M&A opportunities and challenges for both buyers and sellers. Lastly, more volatile investment markets prevail for both cash rich companies and high net worth individuals.

The Irish agri-food sector is one of the most important indigenous industries in Ireland, generating €26bn annually, accounting for 7.6% of Ireland’s gross value added (2014), 10.7% of Ireland’s merchandised exports (2015) and 8.4% of total employment (Q116). Of national GVA, primary agriculture, fisheries and forestry together accounted of 2.5%, while the Food & Beverage industry was responsible for 5.0%. The agri-food sector employs 166,000 (CSO 2015 survey) in which the vast majority (66%) are in the primary production side of the business, with a further 28% in the food and 4% in the beverage sectors. The remainder are employed in wood processing. The sector is highly heterogeneous so while meat (19%), dairy (19%) and beverages (12%) in total account for half of all revenue generated, 44% of revenue is classified by the CSO as “other”. The remainder is made up of animal feeds, bakery products, fish, oil/fat and grain products and fruit and vegetables.

investec1september2016Prepared Consumer Foods (PCF) Category

The relatively newly defined prepared consumer foods (PCF) category encompasses all companies that process primary products into baked goods, snacks, confectionary, ready meals, cooked meats, chilled foods and ambient food products is important to the Irish economy. More than 500 manufacturing units spread across the country directly employ almost 21,000 workers and generate goods worth almost €4.1bn, over half of which is exported to over 150 markets worldwide. Exports were up 7% in 2015 to €2.5bn and have increased by over 25% since 2009. The largest contributor to exports and the main growth driver in 2015 was “value added” beef (up 33% to €266m). Chocolate/ confectionery contributed just under €250m (up 17%) followed by value added pigmeat (up 3% to €220m) and bakery (up 35% to €182m).

The sector is an important contributor to exports. Of the €26bn annually generated by the agri-food sector, over 40% (€10.8bn) is exported to over 120 countries worldwide. This rises to 46% (€12.0bn) when forestry, hides & skins and animal foodstuffs are included. The remainder meets the majority of Ireland’s grocery and food service requirements.  Exports were up in 2015 for a sixth consecutive year, this time by 3%, driven by not only higher output but also a weakening euro against sterling. On output there was growth in beverages, beef and seafood. While increased volumes counteracted weak prices in the dairy sector, weaker prices had a negative impact on pig meat exports.

Biggest Export Partner

investec6september2016The UK remains our biggest export partner (41% or €4.4bn), which makes Ireland its largest supplier of food and drink. The market grew 7% in 2015, with stronger export values for beef prepared foods, mushrooms and poultry which helped offset lower beverage and dairy values. A further 31% (€3.4bn) of goods exports were to the rest of Europe, with the remaining 28% spread across the rest of the globe. There was particularly strong export growth into North America (+19%) while exports to China and the Middle East were also higher. This offset a 70% fall in exports to Russia on the current EU boycott, which is now set to last through 2016.

For the prepared consumer foods category, the UK remains the key export market, accounting for 70% in value, with trade up 11% in 2015 to €1.75bn. Exports to other EU markets were up 9% to €520m in 2015 and accounted for c.20% of total exports in the category. While larger companies such as Kerry, Aryzta, Glanbia, Dawn Farm, Green Isle, Largo Foods, Kepak and Valeo Foods account for 50% of the sector’s output, in general, PCF companies tend to be small. Over three quarters of PCF businesses employ less than 50 people. In markets where innovation, quality, brand and customer focus are key, the Irish PCF sector is seen as an enabler for the primary producers to add value and generate sales in export markets.

Expansion is not without its challenges and the current key issue is Brexit as the industry looks to address the short term (currency) and longer term (tariff concerns) impact of the EU referendum vote and positioning to continue volume, if not initially value, growth in exports into our main trading partner.  A pre-Brexit scoping exercise conducted by ESRI for the Department of an Taoiseach estimated that the potential reduction in bilateral trade flows could be as high as 20% with a higher impact on agriculture, food and beverages as these sectors are more dependent on exports to the UK than other sectors. This estimate was based on a “worst case” scenario and came with the caveat that it is going to take more than two years for the UK to exit, giving time for the negotiation of post-exit positions, both nationally and at company-specific levels, the potential for EU/UK level tariffs notwithstanding. In a pre-Brexit exercise, Teagasc estimated the impact to Irish agri-food export values could be between 1.4% and 7% but cautioned that a higher degree of risk would be associated with companies with a substantial dependence on the UK market.  This period of uncertainty, however, is also bound to impact the investment decisions made by those in the Irish food & beverage sector on business expansion both in Ireland and the UK.

investec2september2016Period of Uncertainty

While a period of uncertainty post-Brexit is bound to impact investment decisions made by those in the Irish food & beverage sector on business expansion both in Ireland and the UK, the immediate impact has been felt in the drop in sterling. Almost overnight, Irish exports into the UK have either become 13% more expensive and, therefore, less competitive against UK produce or 13% less profitable, if retail prices are maintained.  The latter appears the more obvious scenario given the current deflationary environment in the UK food sector with retailers resistant to passing on higher currency costs. Indeed, Morrisons has already indicated that there will be no post-Brexit price increases.

While exports into the UK have always been subject to the vagaries of exchange rates, the current concern is that the recent rate move proves to be a permanent structural change rather than the more usual temporary cyclical move. Many Irish Corporates have been slow to recognise this new reality and our Corporate Treasury division is seeing less commitment from Irish exporters to place FX hedges for longer periods. While the hope is that the sterling rate will improve, the concern is that it will continue to weaken, leaving exporters further exposed.

investec3september2016Some relief for Irish corporates may come from the fact that the Post-Brexit currency moves have also impacted food manufacturers in the UK with the drop in sterling fuelling input cost inflation. Latest data from the UK Office for National Statistics shows a 4.1% rise in all food and drink production costs between June and July 2016 compared to a 1% rise between May and June 2016. This potential relief comes with the caveat that a weaker sterling obviously means that UK produced goods are now cheaper to export and may now compete more effectively in the Irish and other export markets.

Deflationary Environment

The deflationary environment in the retail sector has provided a challenge to food and drink manufacturers for over two years. Through the 2008/09 financial crisis consumers reduced their spending on food/drink, actively shopping for lower prices without compromise on quality. While overall economic conditions have subsequently improved, consumers have remained frugal, having learnt that goods at lower prices do not necessarily mean reduced quality. This move to low cost quality products and a general reduction in waste has hit supermarket margins. They have been further exacerbated by the growth of discounters. This has led to intense price wars between supermarket chains for market share, which is squeezing agri-food and drink sector margins.

investec4september2016For the food and beverage sector, this pressure has been somewhat mitigated by the sustained low prices of raw material inputs, from direct inputs such as wheat, soya, edible oils, sugar and milk to indirect inputs such as crude oil (lower manufacturing, transport, etc. costs). While global wheat and maize prices are at four-year lows, Soya has picked up off a four-year low over the past six months and sugar prices have been rallying strongly over the past year. The challenge going forward will be if and when input costs, including labour, start to sustainably tick up in an environment where retail prices are static to falling, how efficiently will producers and food manufacturer s be able to pass through the increased costs.

Brexit and the deflationary environment in the food and beverage sector present both challenges and opportunities for Irish companies in the sector both of which are being addressed by Investec. Investec Ireland actively works across the food and beverage sector both in Ireland and internationally providing hedging solutions for foreign exchange, commodity, interest rates and cash management, debt and equity capital raising, buy and sell-side M&A advice and personal financial management for key executives and shareholders. Recent transactions in the sector include the IPO of Fevertree, the investment by Spar SA in BWG Foods and the formation of Valeo Foods with the acquisition of Origin Foods, Batchelors and Jacobs Fruitfield.

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Enterprise Ireland Launches €500,000 Competitive Start Fund to Support Agricultural and Manufacturing Start-Ups

The Irish Government has launched a new €500,000 Enterprise Ireland Competitive Start Fund to support start-up activity in the agricultural and manufacturing sectors. The Enterprise Ireland Fund, which provides €50,000 in equity funding for each successful applicant will open for submissions on Wednesday 21st September and will close at 3 pm Wednesday 5th October 2016.

Now in its second year, the purpose of the Competitive Start Fund is to stimulate growth for start-up companies working in areas of agriculture and manufacturing that have the capability to succeed in global markets. The fund is designed to enable those companies reach key commercial and technical milestones, that will ensure delivery of their product or service to an international audience.

The fund is open to applications from individuals, early stage companies or prospective businesses operating in the agri-business sector including but not limited to:

Ø  Machine design and manufacturing

Ø  Fabrication

Ø  Engineering and technical activities

Ø  Life science products

Ø  Farm related software and related services

Ø  Vet-pharma, animal health and chemical products

Start-up food companies with potential to export are also encouraged to apply.

Launching the Enterprise Ireland Competitive Start Fund the Minister for Jobs, Enterprise and Innovation, Mary Mitchell O’Connor TD said: “The Enterprise Ireland Competitive Start Fund aims to provide a launch platform for young companies in this sector to establish their business and launch new products and services in international market places. A priority for the government is to help Irish entrepreneurs grow their business and the €500,000 Fund, will go towards supporting the next generation of Irish agri-businesses and manufacturers to compete in export markets, creating valuable jobs throughout Ireland.”

Anne Lanigan, Manager, High Potential Start-Ups, Enterprise Ireland said, “Agri engineering is worth €250 million in exports to the Irish economy and this fund is seeking to encourage and support the next generation of engineering and manufacturing companies coming through in the agriculture sector. The Competitive Start Fund is part of Enterprise Ireland’s strategy for increasing the number and quality of high potential start-up companies that have the potential to employ more than 10 and achieve €1 million in export sales within three years.

“We were encouraged to drive forward with this year’s competition, following the level of interest and the quality of applications we received last year. Applications to this year’s fund will be considered on a competitive basis and we encourage ambitious individuals and start-ups to apply”, she added.

For the third year running, Enterprise Ireland has teamed up with the National Ploughing Association and the Farmers Journal to recognise and reward outstanding innovation in the agricultural sector during the National Ploughing Championships which takes place from the 20th–22nd September 2016 in Screggan, Tullamore, Co. Offaly. Enterprise Ireland representatives will be based at the Innovation Arena at the Ploughing Championships and will be on hand to provide information and answer any questions from potential applicants and entrepreneurs about the Competitive Start Fund.

Full details on the Competitive Start Fund, including the application form can be accessed on the Enterprise Ireland website www.enterprise-ireland.com/agricsf.

CAPTION:

Pictured (from L-R) at the launch of Enterprise Ireland’s €500,000 Competitive Start Fund to support agricultural and manufacturing start-ups are: Minister for Jobs, Enterprise and Innovation, Mary Mitchell O’Connor TD; Richard Fairman, Product Development Manager, FarmFlo; and Anne Lanigan, Manager, High Potential Start-Ups, Enterprise Ireland.

Posted in Agriculture, Enterprise, FinanceComments Off on Enterprise Ireland Launches €500,000 Competitive Start Fund to Support Agricultural and Manufacturing Start-Ups

€200k Feasibility Fund to Support Next Generation of Agri-business in Ireland

The Irish Government has launched a new Enterprise Ireland Competitive Feasibility Fund for agri-businesses. The Fund, which can provide up to €25,000 per initiative, is aimed at stimulating innovative start-ups and creating jobs and growth in the Irish agri-business sector.

The Fund, which is now open for applications from entrepreneurs and early stage start-up companies, will close on Tuesday 6 September 2016.

The purpose of the Competitive Feasibility Fund is to enable promoters to assess the viability and market potential of their business ideas. Enterprise Ireland is seeking to support business ideas that are likely to achieve significant growth within three to four years, with sales of €1m+ per annum and employment of 10 or more.

The fund is open to applications from individuals, early stage companies or prospective businesses operating in the agri-business sector including: machine design and manufacturing; fabrication; engineering and technical activities; life sciences products with application in the agri-sector; farm related software and related services; vet-pharma; animal health and chemical products.  Early stage food companies with the potential to export are also encouraged to apply.

enterpriselogo.095557Minister for Jobs, Enterprise and Innovation, Mary Mitchell O’Connor TD says: “In Ireland we have a strong and dynamic agri-business sector, with highly innovative companies like TrueNorth Technologies successfully winning sales in international markets. Competitive Feasibility Funds are all about developing new businesses that will create jobs in every region in Ireland – something this Government is deeply committed to. If you are a potential entrepreneur or early stage business in the agri-business sector, this Competitive Feasibility Fund can help you get started.”

Denis Duggan, CFF programme manager, Enterprise Ireland, says: “A priority for Enterprise Ireland is to help Irish entrepreneurs and companies to start up. Ireland has a world-class agri-business eco system, which offers tremendous potential for entrepreneurs and existing businesses to carve out opportunities for innovative products and services. Agri-businesses sustain and create jobs in many rural areas and are significant contributors to their local economies. Irish agricultural machinery exports alone are valued in excess of €100m per annum. With this €200k Competitive Feasibility Fund, we aim to support the next generation of Irish agri-businesses that can grow to compete in export markets, creating valuable jobs here into the future.”

Full details of the fund, including application form, are available on the Enterprise Ireland web site: www.enterprise-ireland.com/AgriFund.

CAPTION:

Pictured (L-R):Paddy Halton, Managing Director, TrueNorth Technologies; Minister for Jobs, Enterprise and Innovation, Mary Mitchell O’Connor TD; and Denis Duggan, Enterprise Ireland.

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Agriculture is Major Contributor to the Polish Economy

Agriculture is currently the fourth largest sector of the Polish economy, and its share in the GDP of the country is much higher than the European average. The value of national production places Poland in 7th place in the European Union.

Poland has gained a significant position as a producer and exporter of agri-food products in the global market. For several years now, it remains the largest in the EU and the world’s third largest apple producer. At the same time, Poland is the biggest EU producer of concentrated apple juice.

Poland is also the second, behind China, apple concentrate producer in the world. Poland remains at the forefront of production of many goods in the EU, e.g. poultry, carrots, white cabbage, triticale, black currant, rye, oats, strawberries, sugar beet, rapeseed, onions and potatoes. Poland is a significant producer of: milk, cheese, butter, tomatoes, and tobacco. 35% of all mushrooms imported in the world, come from Poland.

PolishPolskaLogoJuly2016Changes in agricultural processing have been significantly affected by EU integration. EU funds, along with domestic support, with a significant effort on part of the farmers, entrepreneurs and employees of processing plants, contribute to accelerating the pace of modernization of agricultural holdings and companies of the agricultural sector. Plants which were first to implement EU requirements, were those involved with meat and milk processing. Today, they are among the best in the world. Polish food has a strong position on the European market, where nearly 3/4 of export is directed.

Furthermore, more than 30% of all Polish food is exported to more than 70 countries in the world. Poland’s inclusion in the uniform market revealed the competitive advantage of Polish agricultural producers and processors, and resulted in a fast increase in the displacement of agri-food products. The combination of high-quality raw materials with modern production technologies, as well as continuous improvement of the quality control system, makes Polish food products gain an increasingly wider recognition among consumers not only in the EU, but also in Asia.

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Food Academy to Support 1500 Jobs in Irish Food and Drink Sector

A survey by the Local Enterprise Offices in Ireland shows that 281 small food and drink producers, members of the Food Academy Programme who employ 1,131 people, have made the break-through into the retail market. Those same businesses expect to create a further 373 jobs over the next 12 months, bringing the total number of jobs supported to just over 1,500 across the country.

Run over a series of workshops, the programme is an initiative of the Local Enterprise Offices, Bord Bia and SuperValu to nurture new start-ups in the food and drink sector and it focuses on areas such as business planning, understanding consumer trends and raising finance.

Minister for Jobs, Enterprise and Innovation, Mary Mitchell O’Connor TD comments: “The Food Academy Programme has been running very successfully for the last three years by the Local Enterprise Offices in partnership with Bord Bia and SuperValu. This programme has already enabled almost 300 small food businesses to start and grow, creating valuable jobs across every county and region.One of my priorities as Minister is creating an environment where job growth can thrive, particularly in rural Ireland. I want to thank Bord Bia and SuperValu for their support and I want to thank the LEOs for their endeavours in developing this opportunity.”

The businesses receive one to one mentoring and also pitch for a chance to trial their products in a SuperValu store. Since the programme began in 2013, over 1,100 products have been successfully trialled and are now on sale through the Irish supermarket chain. According to SuperValu, consumers in Ireland are expected to spend €25 million on Food Academy products in their stores in 2016.

Start-ups and small businesses in the food and drink sector are supported by Local Enterprise Offices through measures such as financial assistance, mentoring and on-line trading supports. Oisin Geoghegan of the Local Enterprise Offices says: “By equipping owners and managers of food businesses with industry knowledge and skills, they have a better chance of succeeding in business. The goal of the Food Academy programme is to help more food producers to start selling through supermarkets, as well as through farmers’ markets and to provide them with the supports, information and advice to scale up and achieve this retail break-through. According to research undertaken by the Local Enterprise Offices, the Food Academy producers already support 1,131 jobs across every region. Over the next 12 months, these producers are planning to create an additional 373 new jobs.”

Aidan Cotter, the CEO of Bord Bia, says: “Bord Bia is delighted with the success of the Food Academy programme. The partnership approach with the Local Enterprise Offices and SuperValu has created a real opportunity to cultivate sustainable small food companies by supporting them through the initial challenging phases of growth. These small innovative and dynamic food businesses play an important role in Ireland’s agri-food sector both locally and nationally. The producers receive a combination of commercial and marketing insight from Bord Bia as well as expert advice in branding, market research, distribution and business development, which arms them with the tools to strengthen their chances of future success. The programme has consistently delivered tangible benefits resulting in job creation and sustainable local food businesses.”

Martin Kelleher, SuperValu Managing Director, says: “As the number one supporter of the Irish food industry, we are committed to sourcing from local suppliers and helping to create the next generation of Irish food entrepreneurs. By supporting these Food Academy producers, we are bringing community based start-ups to market and providing them with the potential to grow their business as well as providing employment within the local community. We are proud to nurture the energy and passion of these entrepreneurial producers, which in turn contributes to the prosperity of local economies across Ireland.”

The Food Academy Start programme is delivered through the Local Enterprise Offices in local authorities and details around the next programme are available through www.localenterprise.ie.

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Driving Innovation With Henri@Nestlé

Nestlé is to build new partnerships with start-ups by launching a new global open innovation platform called Henri@Nestlé. The platform will expand Nestlé’s on-going activities in working with start-ups by building on theSilicon Valley Innovation Outpost, launched in 2013.

It will help create a more effective approach to innovation, working with technology partners and early stage entrepreneurs.

Henri@Nestlé will provide an online mechanism for start-ups to partner with Nestlé and gain access to its geographic reach & extensive brand portfolio.

Start-ups can submit ideas to the site, which will provide an ongoing series of business challenges on themes from digital services and sustainability to creative content and product innovation among others.

Successful applicants will receive funding and the chance to partner, pilot and scale up their solution with Nestlé. Henri@Nestlé is due to launch at the end of June.

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Guinness Enterprise Centre Wins Global Award

The Guinness Enterprise Centre (GEC) has been ranked the world’s Top University Associated Business Incubator in the prestigious UBI Global rankings. Selected from the 1,200 incubators worldwide which entered, the GEC scored 78/100 compared to a global average of 53/100. Contribution to job growth and support for graduate start-ups were highlighted among the GEC’s top attributes.

Collaboration with a large investor network was another key success factor. The GEC is managed by Dublin BIC, which also manages the AIB Seed Capital Fund and Halo Business Angel Network (HBAN), helping start-ups become investor ready, access finance and grow their companies domestically and internationally.

The GEC is a not-for-profit, world-class enterprise centre for ambitious and innovative companies. It provides a modern, spacious and flexible working environment, offering private, shared or co-working office space, supported by best-in-class business support services. The GEC works closely with Enterprise Ireland, Dublin City Council, Dublin Local Enterprise Office, Diageo, and Guinness Workers Employment Fund.

The UBI Global World Top University Business Incubator and Accelerator Rankings assess 1,200 university incubators around the world and rank them according to value for ecosystem, value for clients, and attractiveness. This year, 330 of the 1,200 incubator entrants, including the GEC, were benchmarked.

Three global awards are given out in total – University Associated Business Incubator, Top University Business Incubator and Top University Business Accelerator. The university associated section, won by GEC, is given to the highest-ranked incubator that works closely with, but has no formal affiliation to, the universities in its jurisdiction.

The GEC works closely with top universities and institutions in Ireland, including Trinity, DCU, DIT, UCD Smurfit, Ballyfermot College of Education. The centre also frequently collaborates with universities abroad including the University of Phoenix, Arizona; Northeastern University, Boston; and University of Padua, Italy.

More than 90 start-ups call the GEC home, with an additional 70 support companies housed in the centre. Many of these are graduate-led companies, started through collaboration with various universities. More than 370 people work in the incubator, with close to 1,000 employed globally by the start-ups it houses.

UBI Global also recognised the GEC for hosting events for its start-ups, ranging from investor networking opportunities, hackathons and tech meet-ups, and also yoga classes, golf trips, hiking and five-aside football games.

David Varian, chairman, Guinness Enterprise Centre, says: “We understand that our ability to help commercialise projects was a key factor behind our success. Working closely with universities has been a core part of what we do since the GEC was born in 1999. We hone the talents of ambitious graduate start-up leaders from Ireland and abroad to give them a base, help them develop their skills, and connect them with the right people to grow. Ireland is a globally recognised start-up hub and we’re delighted to play a part in this and be recognised for our work.”

CAPTION:

Pictured (from left to right): Michael Culligan, business manager, Dublin BIC; David Varian, chairman, Guinness Enterprise Centre; and Richard Bruton TD, Minister for Jobs, Enterprise and Innovation.

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