Acquisitions help Numico tap new markets
record 43.5 per cent profit rise, boosted by acquisitions in Asian
and Southern European markets.
The maker of Milupa baby food said first quarter profits rose from €44m last year to €63m in 2006, excluding discontinued businesses, acquisition and integration costs.
CEO Jan Bennick attributed the record growth to the strength of all three Numico specialised nutrition divisions - Nutricia Baby, Nutricia Clinical and Dumex.
Organic sales growth in the Nutricia Baby division reached 11.5 per cent, to €363m.
Improved sales across all regions enhanced the division's overall performance, but Eastern Europe and Rest of World markets grew the most, at 18 per cent and 30 per cent respectively.
Sales volumes were particularly strong in Turkey, Indonesia and the Middle East.
Nutricia Baby's Western European sales grew three per cent, impacted by poor sales in Germany as the firm repositions itself in the difficult market.
Newly-acquired Italian baby food firm Mellin, which achieved a volume sales growth of 14 per cent and value growth of nine per cent for the quarter, helped bolster the division. It will be fully integrated later this year, bringing anticipated cost savings of €15m.
But it was Numico's new Dumex infant nutrition division that saw the greatest rise in organic sales growth to 28.3 per cent.
Dumex was bought last year from Danish EAC Nutrition last year, and is the leading baby food business in Asia-Pacific. The acquisition immediately gave Numico access to the lucrative Chinese market, and since becoming fully integrated ahead of schedule early this year it has pumped up the balance sheet.
Numico's smaller Nutricia Clinical subsidiary delivered growth of 11.2 per cent to €173m in the first quarter.
Strong growth in the GI Allergy range propped up performance, particularly across Northern Europe, France and Brazil.
"Based on this overall strong start to the year, we feel confident to raise our sales growth target to between 12 and 13 per cent," Bennick said.
The firm, which makes British baby food brand Cow and Gate, also provides specialised nutrition for AIDS and cancer sufferers.
It was rumoured to be a takeover target last year, but a string of acquisitions have since proved the company is following its own ambitious growth plan.
