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European Business News – Week ending October 29, 2010

 Breaking News
  • EU Agri-food Exports are Holding Strong The value of EU agri-food exports reached €137.9 billion in 2017, corresponding to a sustained increase by 5.1% in value terms compared to 2016. Published by the European Commission, the latest monthly trade report details the export values for different sectors and origin. Major gains in annual values have been achieved in agri-food exports to the USA [...]...
  • Danone Continues to Make Solid Progress With Strong 2017 Results Danone has posted consolidated sales of €24.68 billion for 2017, up by 2.5% on a ‘like-for-like New Danone’ basis (reflecting the integration of the WhiteWave acquisition), including a 3.9% rise in value showing continued mix and value enhancement in all business sectors, which offset a 1.4% decline in volume. Full-year reported sales were up 12.5% [...]...
  • Nestlé Reports Weak Sales But Margins Improve Nestlé has reported a 0.4% increase in sales to SFr89.8 billion (€77.7 billion) for 2017. Net divestments reduced sales by 1.9%, largely related to the creation of the Froneri ice cream joint venture. Foreign exchange had a minimal negative impact of 0.1%. Organic growth was 2.4%, with 1.6% of real internal growth (RIG) and pricing [...]...
  • Customized Ingredient Solutions are the Way to More and Better Gluten-free Bakery DuPont Nutrition & Health has announced the results of a consumer survey where consumers in four key European markets were asked about their attitudes to gluten-free bakery products. The survey results have revealed untapped potential for bakers to develop more and better-quality products with extra nutritional benefits. While only an estimated 1 percent of the population [...]...
  • Leading Retailers Join the UK’s Big Plastics Debate Coca Cola, Co-Op, Asda, Marks & Spencer and Iceland will come together under one roof for the first time at Packaging Innovations 2018, to talk about the UK’s hottest topic – plastics in packaging. These leading brands will form a panel, as part of the show’s Big Plastics Debate, discussing the road ahead for packaging [...]...

European Business News – Week ending October 29, 2010

November 01
13:04 2010

Russia has been in the news lately with PepsiCo announcing plans to build a $140m factory, its tenth plant in the country, as part of a $1b investment programme. The US-based soft drinks and snacks behemoth has already invested $3b in developing its Russian business over the previous decade and sees the region as providing one of its most exciting growth opportunities.

Danone is also targeting Russia. The French food giant has now received regulatory approval for the merger of its fresh dairy products operations in Russia with those of Unimilk, Russia’s second largest manufacturer of dairy products and baby food. To facilitate the Unimilk deal, Danone has sold its 18.4% stake in Wimm Bill Dann Foods, the market leader in Russian dairy and baby food, for $470m. Danone has held the stake since Wimm Bill Dann’s IPO in 2002, which provided the platform for the Russian group to expand its geographical footprint by acquiring successful businesses in Russia and the CIS, while investing heavily in modernising its production facilities.

International Expansion

Two other French groups, Florette and Bonduelle, are continuing their international expansion. Florette is commencing fresh salads production in the Spanish island of Gran Canaria, while Bonduelle has opened its first factory in Brazil to cater for the growing canned vegetables market there.

Having disposed of its dairy business to Lacatlis of France for Eur630m to concentrate on developing its core rice and other food activities, Ebro Foods is closing in on a major acquisition in Australia. Spain’s largest food group is negotiating a Eur420m takeover of SunRice which would give it leading positions in the branded rice foods markets in Australia, New Zealand, the Pacific Islands, Hong Kong, Singapore, Papua New Guinea, the Middle East and California/Hawaii in the US.

Tough Times for Premier Foods

Close on the heels of agreeing to pay out £167m over the next four years to restructure and de-risk its interest rate swap portfolio as part of its strategy to place the group on a more stable financial footing, Premier Foods has reported a slowdown in trading in its third quarter with sales of its branded products slipping by 0.5%, despite volume growth of 4.5%, and total group sales down 4.2% owing to a reduction in non-branded sales.

The sharp rise in wheat prices has forced the UK’s largest domestic food processor to increase the price of Hovis, Britain’s second largest bread brand after Warburtons. However, Tesco, the country’s largest grocery retailer, has subsequently de-listed 12 Hovis products following the rise in price.

Since its £1.2b acquisition of RHM in February 2007 shortly after its £480m purchase of Campbell Soup’s British and Irish operations, Premier Foods has struggled with its billion-pound debt mountain. It is currently trying to sell its meat-free business, based on the Quorn brand, to reduce debt, but speculation is mounting that it will also have to dispose of Hovis, as pressure mounts on chief executive Robert Schofield.

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