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Owner of bakery and cereal ingredients group LCI reports jump in profits

By Jane Byrne , 22-Dec-2011

Cereal and bakery ingredients delivering for Limagrain
Cereal and bakery ingredients delivering for Limagrain

The co-operative owner of bakery and cereal ingredients supplier Limagrain Céréales Ingrédients (LCI) has reported a hike in net income of €23m in its full-year results.

The French agricultural group, specialized in field seeds, vegetable seeds and cereal products, said like-for-like sales jumped 11.6% to €1.56bn.

Sales were up 15.3% if acquisitions such as that of French bakery manufacturer, Jacquet-Brossard, back in May are included.

The co-operative also reported a rise in cultivated acreage, despite the “persistent volatility in the prices of agricultural raw materials.”

All the divisions, said Limagrain, showed positive financial results. Bakery products generated sales of €184m - representing 5% growth and cereal ingredients contributed €75m in sales - up 27% on the previous year’s results.

The group has previously reported its intentions to internationalize its cereal products division over the long term.

Limagrain, added Chéron, plans to intensify its investment in research, with the company having already hiked up its financing of this area to the tune of €13m over the past 12 months, and is in the process of setting up a joint venture with German seed company KHS.

Expansion strategy

Expansion in the form of the Brossard purchase and the alliance with the Brazilian seeds company Sementes Guerra were the highlights of the fiscal year for the seed company, said group CEO Daniel Chéron, with the Brossard takeover placing Limagrain third largest in terms of the leading French industrial producers of bread, cakes and pastries.

September saw the CEO flagging up Limagrain’s long-term ambition regarding the Brossard brand, citing plans for it to become an international player and market leader in the bakery products sector.

Chéron said Limagrain’s clear understanding of agricultural production and wheat quality, efficient research facilities for creating new products and developing innovative manufacturing processes, the reputation of its brands, and its international expertise in terms of development would support the group’s ambition for Brossard.

Specialty breads

Emmanuel Aimond, CEO of Jacquet-Brossard, added at the time: “our strongest positions - number 2 for the Jacquet brand in industrial bakery products with 15% of market share in terms of volume and number 2 for the Brossard brand in industrial pastries produced in France with 19% of the market in volume - need to be reinforced.

We would like to strengthen our leadership in specialty breads (30% of the market in this segment), reinforce our positions in sandwich bread and expand the brand’s territory in pastry".

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