Atria Shows Substantial Profit Rise26 February 2013
FINLAND - Finnish based meat processor Atria Group's net sales for the year in 2012 reached to €1,343.6 million compared to €1,301.9 million in the previous year - a rise of €41.7 million from 2011.
Profit increased substantially to €30.2 million compared to €8.0 million.
The Group's operating cash flow was €99.6 million compared to €50.3 million in 2011.
Consolidated free cash flow was €49.7 million compared to €9.5 million in the previous year.
In the fourth quarter, Atria Finland signed agreements concerning the sale of trade receivables. These agreements decreased the company's trade receivables by a total of €61.2 million at the end of the period.
At the beginning of 2012, Atria Plc's Board of Directors decided to terminate the share incentive plan for Atria Group's key personnel and replace it with a new long-term reward programme. The share incentive plan no longer applied in 2012.
Atria Finland's net sales in 2012 were €819.5 million showing growth of €25.8 million year-on-year. EBIT amounted to €36.5 million compared to €19.3 million, up €17.2 million from 2011.
This increase was due to improved conditions in the meat market and higher sales prices across all customer accounts. In addition, the sales structure was more favourable and cost savings resulting from efficiency measures improved the performance.
The EBIT for 2012 includes a non-recurring expense of €0.5 million relating to the termination of bovine slaughtering at the Kuopio plant. The EBIT for the reference year includes a non-recurring write-down of €1.8 million for the value of the Forssa logistics site.
Atria Scandinavia's net sales in 2012 totalled €387.8 million compared to €74.9 million, showing growth of €12.9 million year-on-year. In the local currency, net sales were at the same level as in the previous year.
EBIT amounted to €8.2 million compared to €13.8 million oin 2011. The reason for this decrease was the higher price of meat raw material in comparison with the previous year.
Atria has not been able to pass on all of the increased raw material costs to sales prices. The EBIT for the reference period includes a non-recurring profit of €0.7 million for the sale of the Saltsjö-Boo facility.
In January 2012, a programme was launched to improve the profitability of Atria Scandinavia's production of meat products. Atria is investing approximately €4.7 million in new production equipment for the Malmö plant.
The manufacture of ham products and the slicing of cold cuts was transferred from the Halmstad plant to the Malmö plant. The programme is expected to generate annual cost savings of approximately €1.5 million. The savings began to materialise in 2012 and will be fully effective from the beginning of 2013.
Atria Russia's net sales for the year amounted to €126.3 million (compared to €123.0 million in 2011. In the local currency, net sales were at the same level as the year before.
EBIT showed a loss of €8.6 million compared to a loss of €18.9 million in 2011, showing an improvement of €10.3 million over the previous year.
This increase was due to efficiency improvement measures, price increases and the streamlining of the product range. The poor profitability of primary production weighed down fourth quarter profits. Atria Russia also invested heavily in marketing to increase future sales volumes.
Atria Russia's EBIT includes a non-recurring profit from the sale of a Moscow factory and related non-recurring costs. In total these items had no impact on the EBIT. The facility in question had previously been reported under assets held for sale.
During the reporting period, Atria Russia launched a programme aimed at improving production efficiency at the Sinyavino and Gorelovo plants in St Petersburg. These measures are expected to generate annual cost savings of around €2.0 million, which will be fully realised from the beginning of 2013. Meat products are now produced at the centralised Sinyavino and Gorelovo plants.
Atria Baltic's net sales for the year amounted to €34.2 million compared to €35.2 million in 2011.
The Baltic region showed a loss of €1.5 million reducing the los in 2011 of €2.2 million by €0.7 million year-on-year. The improvement in the reporting period is due to anincrease in the sales of further processed products. EBIT in the reference period includes a total of €0.3 million of non-recurring costs.
TheMeatSite News Desk