A decision was taken during the second quarter of the year to restructure production within organic chicken in Sweden, resulting in a charge of SEK22m against operating income. As part of this restructure, it took a decision to close its slaughtering facility in Åsljunga, Sweden, which is expected have a positive effect on earnings from 2019.
During the second quarter of the year, it reported a net sales increase of 39% to SEK2,252m, which was driven by the acquisition of Irish company Manor Farm in August 2017.
Net sales increased by 4% in Sweden, 10% in Denmark, 5% in Norway and 31% in Finland.
The business reported that its share of value-added products of total net sales increased significantly compared to the second quarter 2017 pro forma. Chilled products grew by 4% and ready-to-eat products rose by 16%. Sales in the retail channel increased by 7% and net sales in the foodservice channel rose by 12%.
Commenting on the results, group CEO Leif Bergvall Hansen said:
“Although I am pleased that we continued to strengthen our position in our home markets, I see a further potential for converting the top-line growth into margin. We are working intensively to optimise our performance under the current market circumstances in Sweden and expect the market investments in Denmark to gradually start to pay off. It was also satisfying to see the positive development for Ireland and to be able to report a continued improvement in earnings in Finland. The performance of the operation in Norway is a good example of the potential in our business.
“We are carefully following the structural changes in our sector and believe that we are ideally positioned to take part of the consolidation in the European poultry market. We believe the acquisition of Manor Farm is a good illustration of how we can create value and stability for our shareholders. Our geographic diversification is a strength for the group as most of our margin drivers are country-specific.”