Food oil specialist Cereol, recently demerged from Eridania Béghin-Say, revealed a giant leap in profits this week for th first six months of 2001.
The operating profit shows an increase of 158 per cent compared to the first six month period of 2000. According to Cereol this is due both to a sharp recovery in margins as compared to the weak levels recorded in 1999 and 2000, and, it boasts, " to the Group's policy of integration, innovation and cost control."
The operating profit of the Food Oils Europe Division grew by 267 per cent to 69.7 million Euro for the first six month period of 2001, linked to a strong recovery in Eastern Europe and Southern Europe while maintaining high growth and profitability for branded oils.
In North America, the Processing Division operating profits grew by 204 per cent to 14.3 million Euro. This growth results from recovery of soya crush margins, linked to local demand for soya meal and the reduction of production capacity in the United States, despite higher energy costs. The company added that unfavourable canola (rape seed) crush margin conditions had a negative effect.
One negative amongst all the positives. The operating income of the Specialty Products Division fell by 30 per cent to 9.5 million Euro, largely due to increased energy costs and the increase of development costs for new products.
Net sales grew by 11 per cent. Cereol reports that this reflects major growth in European and American meal volumes and oil volumes principally in Europe. The net income of the Group share runs at 6.7 million Euro for the first six month period of 2001 against a loss of 4.8 million Euro. Leaving aside the problems of comparison discussed above, this result has been impacted by the demerger costs and the debt financing cost.
Cereol anticipates that the net recovery observed over the first six month period of 2001 should continue during the second part of the year.Although it warns that the growth in operating profit is not anticipated to be as spectacular in the second six month period because of the solid recovery achieved during the second half of the year 2000.