September 2, 2010
Provimi records strong H1 2010 performance
Press Release
Overall operational performance for Provimi Group improved strongly in H1 2010 compared to the same period last year.
Revenues have increased by 6.2% to EUR892.9 million (US$1,142.9 million), following the raw material prices trend. The impact of acquisitions and divestments reduced revenue by EUR2.4 million (US$3.1 million). Favourable exchange rates had a positive effect on revenue of EUR46.7 million (US$59.8 million).
Recurring operating profit increased by 31.9% to EUR68.2 million (US$87.3 million), against EUR51.7 million (US$66.2 million) over the same period in 2009, helped by the initiatives implemented by the group last year. The impact of acquisitions and divestments reduced the group''s recurring operating profit by EUR0.7 million (US$0.9 million), while favourable exchange rates had a positive impact of EUR3.3 million (US$4.2 million).
Provimi has continued its transformation programme, implementing several initiatives in the framework of its One Provimi strategy and is now well positioned to exploit future opportunities.
The new integrated marketing and innovation organisation for the Animal Nutrition business, called "Feed Solutions" is now fully operational to leverage Provimi''s expertise. Feed Solutions will help drive Provimi''s future growth agenda in Animal Nutrition on a global basis, in particular identifying products and services that can be offered across the business.
The global implementation of SAP is progressing well and will, together with other Provimi wide initiatives, further improve efficiency and knowledge.
Provimi has launched a new quality management system to ensure a consistent high quality of its products worldwide and has increased its focus on its Global Environment, Health & Safety Programme. The group will work on three areas that impact the environment and that are important in its business: emissions, energy consumption and waste. The monitoring and further improvement of a safe and healthy working environment for employees worldwide is also part of this programme. Sustainability and corporate responsibility are key areas of focus for Provimi and will remain high on the agenda as is the commitment to ensuring food safety.
Group CEO Ton van der Laan commented, "Following a successful 2009, the business has continued to perform well. Provimi continues to strengthen the competitive position of the group in 2010 with its transformation initiatives and One Provimi strategy that have proved to be very effective. Provimi has a clear focus on customer satisfaction and higher added value. We will now focus on our stated strategy for growth in core markets and are well positioned structurally to exploit available opportunities."
Provimi continues to focus and invest in emerging markets where the greatest growth in demand for its animal nutrition solutions is expected. In particular, the group is investing and developing its businesses in Russia, Asia and Latin America.
The Russian business continues to outperform the market by providing consistent performance-driven solutions to its customers.
In Asia, Provimi has strong footprints in key animal nutrition markets such as India, China and Vietnam and is looking for opportunities to further expand there. In India, the business is quite diverse with a strong infrastructure and well positioned to benefit from the expected growth in the market as meat consumption increases. The animal nutrition side of the business is repositioned and invested in to ensure it is best placed to take a leading position in a market that is currently highly fragmented. Vietnam continues to show strong growth.
Provimi''s Latin American business, located in Brazil, Argentina and Colombia, is well- positioned to serve this diverse region. Brazil in particular goes from strength to strength, clearly now positioned as the number one animal nutrition player in the third largest market in the world.
In the more mature and consolidated markets of North America and Europe, Provimi''s animal nutrition business performed in line with markets and continues to strive to offer its customers the best solutions for their requirements, delivering sustainable performance. In particular, Provimi North America, an important business in the largest market in the world, has improved its manufacturing and operational efficiencies through consolidation of its operations. It continues to
improve its positioning in the high value-added segments of the market, where it is clearly the market leader.
Poland and South East Europe are key regions that remain challenging. Clear initiatives are being implemented to better position the businesses in these important markets and to strengthen our performance there.
With reference to the animal nutrition business, for the second half of the year, the group will focus on increasing volumes and key market positioning, supported by clear initiatives to improve offering to customers in a targeted way.