August 1, 2008
Nutreco's 70-percent increase in H1 profits exceeds expectations
Feed manufacturer Nutreco posted H1 operating profits of 80.1 million euros (US$124.8 million) on Thursday (July 31), up 70-percent from last year, an increase that dwarfed analysts' estimates.
The Dutch company had sales of 2.3 billion euros for H1 this year. This marks a 38.4 percent increase from 2007, and also beat estimates by analysts who predicted a 27-percent increase in sales.
Previously, an average forecast in a Reuter's poll of seven analysts reported expected earnings at 60 million euros on sales of 2.1 billion euros. However, the real earnings turned out to be more than a？？20 million more.
This puts the world's largest fish feed producer and fifth-largest animal feed producer on track to double its 2006 earnings of 230 million euros by 2010, said Chief Executive Wout Dekker.
Higher prices and growth in animal feed sales accounted for the higher-than-expected operating profits, as the company was able to pass on higher raw material costs to customers. In addition, record world prices for grain had farmers opting to sell their crops instead of feeding them to livestock, therefore boosting their sales of manufactured feed.
The increased profits from animal feed helped offset weakness in fish feed, where profit dropped 40 percent after salmon farms in Chile were hit by disease.