Posts Tagged ‘sales’

IRI reveals £5.2m missed opportunity for retailers as Easter confectionery sales rocket

April 18th, 2015
Comments Off on IRI reveals £5.2m missed opportunity for retailers as Easter confectionery sales rocket

Easter confectionery sales were up strongly this year, according to data just released by IRI, the retail and FMCG market intelligence company.  The figures from IRI’s Retail Advantage solution, which measures sales across all of the major grocery multiples, show that UK retailers had a better than expected Easter, with sales of Easter confectionery up by 8.6% during the five-week run-up to the Saturday before Easter Sunday.

Heavy promotional activity on Easter confectionery by some of the supermarkets in early March was responsible for helping drive sales up – with volumes up by 15.1% over last year. However, despite value sales reaching a peak of £111m in the final week before Easter – 5.9% up on the same week last year – IRI believes that supermarkets missed a golden opportunity to cash in to the tune of £5.2m in the final week before Easter.

“We’ve seen some reports suggesting that supermarkets were running out of eggs in the final week before Easter,” according to Martin Wood, Head of Strategic Insight – Retail for IRI.  “So while sales did increase in that final week, they didn’t increase as much as they had in the earlier pre-Easter period starting in early March. I would estimate that the missed opportunity was £5.2m – this is the difference between the increase in sales that occurred in the final week and the increase that would have happened if the average sales growth over the 5-week Lent period had been maintained.”

Easter, traditionally one of the sector’s biggest seasonal events, along with Christmas, Valentine’s Day and Mother’s Day, saw the strong demand for confectionery from consumers against a backdrop of falling prices and declining value sales and volumes generally in the major supermarkets.

“What this suggests to us is that we’re seeing a resurgence of seasonal event management in retail this year, following strong Valentine’s Day and Mother’s Day sales. But it’s also clear that the major supermarkets underestimated the demand for Easter and that other retailers, like convenience stores, benefitted from this. It’s reasonable to assume that they could have done a lot better this year if they hadn’t sold out of eggs!”


Confectionery , ,

U.S. confectionery market to grow $6 billion in 5 years

October 31st, 2014
Comments Off on U.S. confectionery market to grow $6 billion in 5 years

The U.S. confectionery market is expected to see about $6 billion in increased sales in the next five years, and premium products are driving the growth. But the industry is growing faster globally than it is domestically and commodity costs are impacting costs from the farm to the finished product.

Those were just some of the takeaways from yesterday’s “Sweet Insights: Maximizing Candy” presentation by Larry Wilson, the National Confectionery Association (NCA)’s v.p of customer relations. His talk was part of the NCA’s Chicago Briefing.

Overall, the U.S. confectionery category accounted for $33.6 billion in sales, but it’s expected to reach about $39.6 billion in five years.

Wilson told the audience that the $6 billion will likely break down to about $4 billion in additional chocolate sales (currently at about $20.6 billion), $1.8 billion in non-chocolate sales (currently at about $10.3 billion), and about $400 million in gum sales (currently at about $2.7 billion).

“The question is, ‘How much do you want?’” Wilson says. “It’s that simple.”

Also during the event Wilson went over the top segments driving growth in the category, including:

  1. Premium chocolate
  2. Strong brand image
  3. Sharable packaging
  4. Hybrid and line extensions
  5. Cross-branding
  6. Seasonal execution
  7. Translating seasonal business gains into everyday business strength

Premium chocolate accounts for about 8 percent of the U.S. market. Last year, it grew by nearly 15 percent. compared to 4 percent for all chocolate sales. Figures for the latest 12 weeks show chocolate sales being up 2.5 percent, with premium chocolate sales up nearly 18 percent.

Moreover, the NCA sees so much potential for the category, that it’s actually impacted how they’ll showcase it at the Sweets and Snacks Expo. Next year the Expo will feature a “Specialty Marketplace” instead of the “Gourmet Marketplace” as part of an effort to being more inclusive.

As for strong brand image, Wilson says manufacturers have found that investing in their own brand equity has been extremely successful. And that includes opening up single-brand stores, something Godiva, Hershey, Kit Kat, Lindt and Mars/M&M’S have all done.

When it comes to packaging made for sharing, the trend has been especially prevalent in North America and Europe. However, China actually leads the re-sealable market, followed by Japan and then the U.S.

Such packaging is attractive to consumers because they can share the candy, and since it’s re-sealable, it can help with portion control. Also, mini-sharing bags tend to command a higher unit price, Wilson says.

When it comes to hybrid products and line extensions, this trend helps manufacturers capture consumers who are already loyal to their brands. And, it gives candy makers a chance to delve into other aisle. For example, Hershey recently released a Hershey’s Spreads line, which helped it gain a spot in most condiment aisles.

Then there’s the cross-branded products, which can leverage brand equity of more than one iconic brand, increase brand recognition, and expose consumers loyal to one brand to a different product category.

For example, Mars recently teamed up with Kellogg’s to introduce Keebler Chips Deluxe with M&M’S — combining a powerful snack brand with a iconic candy brand.

One of the best times to introduce either hybrids, or new and innovative products is during the various seasons, Wilson says. Customers tend to be looking to try new things, which makes it a good time for trial, and they typically have money in the budget specifically for candy.

Also, most seasons have an emotional tie, just like most candy, making them an ideal match.

“There’s no other category that evokes emotions like this category,” he says.

However, even with all those factors driving growth, manufacturers still need to be conscious of their prices — which is why rising commodity costs have so much potential to cause problems.

As of August 2014, versus a year ago, commodity prices for chocolate were up 31.7 percent, dairy was up 19 percent, sugar was up 20 percent in the U.S. market and hazelnuts were up 80 percent.

“These are real numbers,” Wilson says. “And they impact what’s going on with the overall business.”

Fuente: Candy Industry


Confectionery, Packaging ,

UK: market for bread and bakery products grew by 3,4%

July 5th, 2014
Comments Off on UK: market for bread and bakery products grew by 3,4%

bread-imageAccording to «Bread + Bakery Products», a new Market Update from market intelligence provider , retail sales of bread and bakery products in the UK increased in value by 3,4 percent in 2013. This growth is impressive considering the long-term decline of bread consumption in the UK.

Volume sales of traditional loaves are declining at a faster rate than the number of alternative breads sales are increasing; bread is gradually becoming a less integral component of many Britons´ everyday diets amid the diversification of consumer interests in this market. New product developments (NPDs) in competing wheat-based markets such as breakfast cereals and biscuits, as well as the popularity of low-carbohydrate diets, are contributing to the decline in sales of sliced loaves, whether white, brown or wholemeal. Consumers are instead choosing to consume breads from the culturally-diverse speciality breads sector, although they are doing so on a less regular basis, with many consumers opting to do so at dinner, when such products are occasionally used to make the meal more special. Nevertheless, total market value still increased in 2013, due to the ongoing effects of inflation on retail prices, as well as the higher expense of specialty breads.

The rapidly-growing demand for both gluten-free breads and home-made sandwiches also contributed to value growth in 2013, despite falling volume sales. The perception that gluten is unhealthy, difficult to digest and calorific, is fuelling sales of gluten-free bread among the increasing number of consumers who are prioritising weight loss. Home-made sandwiches, on the other hand, are an increasingly popular lunch-time solution because they save time and money. High demand for packed lunch products, among both adults and children, has been boosted by NPDs; combination rolls, wraps and flatbreads are now available, while recent innovations are also focusing on the already-popular bagels category.

Overall, although bread consumption continues to decline, based on the diversification of consumer interests in this market, the very nature of this trend is creating new avenues for growth in other sectors. Key Note therefore forecasts growth of 10,9 percent between 2014 and 2018 within the bread and bakery products market.

Source: bakenet:eu


Bakery , , , ,

Frozen pies and cakes decline, says Mintel study

July 5th, 2014
Comments Off on Frozen pies and cakes decline, says Mintel study

cheesecake1_puratosSales in the U.S. of frozen and refrigerated cakes and pies declined as consumers begin to view them as indulgences and focus on fresh flavours, suggests Mintel research.

While total retail sales in the U.S. of prepared cakes and pies grew 24 per cent from 2009-14 to reach $11.2 billion, frozen and refrigerated cakes and pies was the only segment to decline (2.4 per cent), as consumers focus on fresh flavours and shift towards viewing pies and cakes as an indulgent snack.

In fact, according to the new research, some 41 per cent of consumers claim to eat prepared cakes and pies as a snack between meals, a higher percentage than many other occasions, including for a special occasion dessert (18 per cent).

In-store baked cakes and pies are driving the category with sales representing more than half of the overall category (52 per cent), followed by shelf-stable cupcakes and brownies at 23 per cent. Nearly half of consumers who eat prepared cakes and pies (46 per cent) view them as an indulgence and 42 per cent indicate they are open to trying new flavours of these items. Some 61 per cent agree gourmet or premium products are worth paying more for, including 72 per cent of those aged 25-34.

“The snacking mindset has permeated the dessert segment, as people are mindful of what they eat, but at the same time, want to indulge and treat themselves as well,” commented Mintel food analyst Amanda Topper, in a news release. “Much as we’ve seen with the high-end cupcake and donut trends, consumers are willing to pay a little bit extra for a small indulgence made with quality ingredients. Since almost two-thirds value taste over nutrition and more than two-thirds would like to see more flavour variety, this presents an opportunity to offer more unique, high-quality offerings, especially to younger consumers who are more brand loyal and willing to pay the price premium.”

Private label represents the largest category market share at 38 per cent, a larger share than the market share of all five brand leaders combined. The majority of sales within the prepared cakes and pies category are in supermarkets, which make up 65.8 per cent of the market. Men are significantly more likely than women to eat prepared cakes and pies as part of, or in place of, a meal. Some 24 per cent eat them as part of breakfast, and 25 per cent eat them as part of lunch, while 13 per cent use them as a meal replacement altogether. Women are significantly more likely than men to eat them as a dessert (75 percent, compared to 66 per cent of men).

“Over two-third of consumers have eaten some type of RTE cake or pie within the past six months, and the majority are open to experimenting with flavours,” noted Topper. “To that end, they can stay interested with hybrid flavours, such as sweet and salty options, or seasonal and limited-edition varieties. Natural ingredients, without additives or preservatives, are also important to consumers who buy prepared cakes and pies, so manufacturers should focus on promoting the quality of their ingredients, and promote them via easy-to-read ingredient lists. At the end of the day, people are willing to indulge, but they just want to make sure the calories are worth it.”

Source: Bakers journal


Bakery, Pastry , , ,

Cocoa Acquisition Drives Strong Volume Expansion

July 5th, 2014
Comments Off on Cocoa Acquisition Drives Strong Volume Expansion

Barry_Callebaut-logoJuergen Steinemann, CEO of Barry Callebaut, said: “I am satisfied with our third-quarter volume growth which was driven by the acquired cocoa business, emerging markets and our Gourmet business. As we continued to focus on increasing our product margins, we concentrated on selective growth in developed markets. While the cocoa powder market remains challenging, we are very satisfied with the integration of the acquired cocoa business.”

Total sales volume of Barry Callebaut, the world’s leading manufacturer of high quality chocolate and cocoa products, increased by 15.8% to 1,288,365 tonnes at the close of the first 9 months of fiscal year 2013/14 (up to  May 31, 2014). On a stand-alone basis, excluding the effect of the acquired cocoa business, the Group’s sales volume grew by 2.4% to 1,138,736 tonnes. Volume growth was driven by emerging markets (+63.0% total; +18.2% stand-alone) and the Gourmet & Specialty Products business (+6.9%).
In its industrial business, Barry Callebaut continued to focus on increasing product margins and being more selective in sales: Overall volume growth was +1.8%. The Gourmet business outperformed the markets in most countries (+6.9%), supported by a double-digit growth of the company’s global brands Callebaut® and Cacao Barry®.
Sales revenue was up 22.0% to CHF 4,318.7 million for the total business. Compared to the prior year, higher average raw material costs pushed up sale prices: On a stand-alone basis, sales revenue rose 6.8% to CHF 3,782.7 million.

Outlook – Completion of integration and continued focus on growth strategy
CEO Juergen Steinemann said, looking ahead: “Our priorities remain to complete the integration of the acquired cocoa business and to strengthen our product margins. At the same time, in alignment with our growth strategy, we are preparing the Group for the next growth phase by expanding existing factories and further investing in our overall organization. We are on track to reach our mid-term targets.4

Strategic developments in the first 9 months of fiscal year 2013/14

  • The new chocolate factory in Santiago de Chile emphasizes Barry Callebaut’s strong commitment to “Expansion.” The factory, which goes on stream in July 2014, has a manufacturing capacity in excess of 20,000 tonnes. The investment amounts to CHF 26.5 million (EUR 21.8 million / USD 30.3 million). This expansion enables Barry Callebaut to further tap into the attractive South American market.
  • As a leader in “Innovation,” Barry Callebaut received a positive Scientific Opinion from the European Food Safety Authority (EFSA) to extend its existing health claim for cocoa extract products, which have a higher concentration of health-enhancing flavanols. The company is now awaiting the approval of the EU Commission. If granted, Barry Callebaut’s health claim could be applied to new products in the pharmaceutical, nutraceutical, medical nutrition and health-supplement industry sectors.
  • With a strong focus on “Sustainable Cocoa,” Barry Callebaut is a leading force in the industry. The company helped to form the “CocoaAction” strategy of the World Cocoa Foundation (WCF) – considered one of the most significant initiatives in sustainable cocoa farming. In May 2014, Barry Callebaut was amongst the 12 initiating signatories of “CocoaAction.” In June, the company organized the 2nd international stakeholder conference CHOCOVISION. Both initiatives foster collaboration in the global cocoa and chocolate industry and aim to accelerate the sustainability of the cocoa sector.
  • As per June 17, 2014, the Group extended their EUR 600 million Syndicated Revolving Credit Facility by 3 years (from June 2016 to June 2019). This further strengthens Barry Callebaut’s liquidity and duration profile while slightly reducing the applicable credit spreads.

Regional / Segment performance
Region Europe5 – Focus on product margins, good growth in EEMEA
Sales volume in Region Europe decreased by 0.2% to 553,291 tonnes.
In Western Europe, Barry Callebaut continues to focus on increasing product margins. The Gourmet business performed strongly. Additional capacity installed will support future growth.
In EEMEA, the Food Manufacturers and Gourmet & Specialties Products businesses continue to grow at double digit rates, but slowed down in some countries with economic and political issues.

Overall sales revenue in the Region grew by 10.0% to CHF 1,923.3 million as a result of higher raw material prices and a more favorable product mix.

Region Americas – Good performance across all markets and businesses
Sales volume across Region Americas increased by 6.2% to 327,695 tonnes. In NAFTA, volume growth was driven by the company’s global accounts and the Gourmet business, primarily the imported brands and decorations. Once more Mexico performed strongly. In South America both the industrial and Gourmet business recorded double-digit growth.

Sales revenue rose 7.4% to CHF 927.3 million, as a result of a better product mix.

Region Asia-Pacific – Maintaining pace of growth
The volumes in Region Asia-Pacific showed continued growth at +9.6% to 49,069 tonnes primarily driven by the Food Manufacturers Products business. The Gourmet business declined as a result of unfavorable currency exchange rates and an economic slow-down.
Sales revenue increased by 11.3% to CHF 187.7 million, largely in line with volumes.

Global Cocoa6 – Acquired cocoa business as a growth driver
Sales volume in the segment Global Cocoa went up 75.0% to 358,310 tonnes driven by the acquired cocoa business from Petra Foods. On a stand-alone basis, sales volume increased 1.9% to 208,681 tonnes, reflecting selective sales in an overall challenging market for cocoa powder products.
Sales revenue for the total business grew by 68.3% to CHF 1,280.4 million. On a stand-alone basis sales revenue decreased by 2.1% to CHF 744.4 million as a result of currency effects.

The integration of the acquired cocoa business from Petra Foods is progressing well and synergy targets are confirmed (target amount CHF 30-35 million by the end of fiscal year 2015/16). With most global milestones being achieved, responsibility for the completion of the integration is now gradually moving into the Regions.

Raw material prices
A good start to the mid-crop cocoa harvest, further helped by record rainfalls in the West African region could turn an expected deficit for the 2013/14 season into a slight surplus. Funds consequently sold a significant share of their net long positions. But some industry buying promptly supported prices. In light of the anticipated structural deficit and El Niño forecast, prices steadily increased, finally reaching a two and a half-year high on May 30, 2014 at GBP 1,932.  
As of March, prices on the world sugar market started to increase significantly, also fueled by concerns of a drought in Brazil. After three consecutive surplus campaigns, the market will be more in balance this year. Overall demand was lower as coverage of the industry was good. European sugar prices continued to decrease as a result of a good supply situation.
High market prices fuelled good milk production. Overall demand for milk powder lagged behind supply, resulting in market price decreases over the last few months on both the world and European market. Prices are currently at the same level as a year ago.


Chocolate, Companies, Ingredients ,

Online confectionery sales soar

January 17th, 2014
Comments Off on Online confectionery sales soar

sugar_candy_pralinesThe record level of online sales over the holiday season has highlighted the fact that many consumers prefer to order their sweets, snacks and various other Christmas goodies online, rather than in-store.

Retailers that have invested in their websites and improved their delivery times have been the most popular among customers. According to retail guru and mobile payment entrepreneur Dan Wagner, main street retailers need to leverage online-style technologies in a converged multichannel model to survive.

Dan Wagner commented: “Traditional Main Street stores really need to up their game to compete in the new shopping era that we are entering. They need a multichannel approach that adopts best practise from online and adapts its techniques and technologies to traditional brick and mortar retail.

“Smartphones are becoming the focus for customer engagement with shops and retailers should be employing mobile app technologies to improve the customer experience and transforming their premises into data-rich browsing environments. For example, low-energy Bluetooth beacons can be strategically placed around stores, messaging shoppers as they approach special offers. In this way shopping becomes a more interactive and personalised experience. The technology also has the additional bonus of adding value by retaining valuable data about shopping behaviour.”

Source: Sweets and snacks europe


Confectionery ,

Exemplary food safety practices can drive sales

March 29th, 2013
Comments Off on Exemplary food safety practices can drive sales

A new study from TÜV SÜD suggests product safety, not brand, is the key determinant for consumer purchase.


TÜV SÜD’s Safety Gauge investigated product safety practices and consumer attitudes and experiences across consumer goods, electronics and food sectors in five markets. It found overwhelming consumer willingness to pay premiums for products meeting the strictest safety standards, as well as evidence that safety certifications influence purchasing decisions.

Manufacturers may be in a unique position of being able to leverage consumer concern over product safety to drive commercial success through a systematic approach to product safety. President and CEO of TÜV SÜD North America Ian Nichol says, “Contrary to popular belief, significant safety improvements can be made with limited resources, by working together with suppliers for instance, and standardizing safety requirements throughout the supply chain.”

According to the report, 85 percent of those surveyed said they would be willing to pay a premium of 15 percent over standard prices for products achieving exemplary safety standards. Eight of 10 respondents said safety certifications influence preference for a familiar brand while 60 percent look for safety certification information on labels of unfamiliar products.

The food industry is widely considered the safest of all industries surveyed, but even so, almost all consumers expect further efforts to expand traceability and transparency. Of the industries surveyed in Safety Gauge, food company management ranked highest on product safety practice awareness.

Consumers ranked the food industry as safest among those surveyed, and stated hygiene is a more important criterion than brand or product origin when purchasing a food product. Price and freshness ranked number one and two, respectively, as the biggest purchasing influencers. Respondents expressed the most concern over raw meat and fish products, dairy products including milk and eggs, fruit and vegetables.

Click here to view the entire report.

Source: Food Engineering


Food Safety, Research , ,

Cupcake sales stronger than ever

September 7th, 2012
Comments Off on Cupcake sales stronger than ever

Cupcakes have gained momentum in the bakery department, with a sales increase of 56 percent in the last five years. While cupcakes hold the third highest dollar share within the cakes category (behind decorated cakes and dessert cakes), cupcake performance drove category growth in the 52 weeks ending May 26, 2012, with a 17.1 percent dollar sales increase compared to the previous year. Cupcakes also continue to gain dollar share within the cakes category, up 1.3 percent, while decorated cakes lost 1.4 share points.

In the 52 weeks ending May 26, 2012, cupcakes’ national average contribution to in-store bakery sales was 3.7 percent, a 0.4 percent increase compared to the previous year. Cupcakes averaged sales of $388 per store per week, a 16 percent increase from the previous year.

The highest sales for cupcakes occurred the week ending Feb. 18, 2012, the week of Valentine’s Day, with $946 per store per week. Another significant peak week for cupcake sales was the week ending Dec. 24, 2011, when sales averaged $618 per store, or 28.4 percent growth compared to the previous year. Cupcakes experienced their lowest sales during the week of Dec. 3, 2011, with $255 per store. This week is traditionally low-selling for cupcakes, as it follows the Thanksgiving holiday when pies dominate bakery department sales.

Average weekly sales for cupcakes grew nationally and in each region compared to the previous year. The Central region had the highest average sales with $487 per store per week, well above the national average of $388. The East region also slightly surpassed the national average with $389 in weekly sales per store. Although the East region’s cupcakes had the lowest contribution to the bakery department with 2.6 percent, the East had the highest weekly dollar sales increase, up 18.1 percent. Both the South and West regions increased weekly dollar sales, up 17.7 and 12.7 percent, respectively. The South region tied the Central region for highest contribution to the bakery department at 4.3 percent.

Within cupcakes, assorted/variety cupcakes accounted for 27.1 percent of total cupcake sales nationally during the 52 weeks ending May 26, 2012, followed by mini cupcakes at 21.9 percent. The remaining varieties results included chocolate cupcakes at 14.4 percent contribution, yellow/gold cupcakes at 12.4 percent, white cupcakes at 9.9 percent, cupcake cakes at 8.6 percent and other cupcakes at 5.6 percent.

All cupcake varieties increased dollar sales during the 52-week time period. Nationally, other cupcakes had the most significant dollar growth, up 48.5 percent, followed by mini cupcakes, which increased 22.2 percent. Other increases by variety include assorted/variety cupcakes (16.8 percent), cupcake cakes (16.3 percent), chocolate cupcakes (13.0 percent), yellow/gold cupcakes (11.3 percent) and white cupcakes (8.2 percent).

This sales review is provided by Nielsen Perishables Group. Based in Chicago, Nielsen Perishables Group specializes in measurement, analytics, marketing communications, category development, promotional best practices and shopper insights. Reported results are for May 28, 2011, through May 26, 2012, representing more than 62 percent of national supermarket ACV share.

Source: Modern Baking


Bakery ,

United Biscuits re-launches its store trade website

August 3rd, 2012
Comments Off on United Biscuits re-launches its store trade website

United Biscuits UK, a manufacturer of snacks, biscuits, and cakes, has revamped its trade website to offer independent retailers a wider range of tools and category advice to help them boost sales and profits.

The re-launch includes the addition of a profit calculator, downloadable POS, best-seller range guides, regular competitions and incentives, and selling tools to provide market insight in a bid to help give retailers a competitive edge.

As 69% of trips to convenience stores are unplanned, it is vital retailers make sure they stock the right products in the right way to help them take advantage of the impulse purchase occasions.

UB’s Perfect Store can help retailers plan their range as it offers advice on the best-selling lines and provides tailor made planograms to suit store types and fixture size.

Details of must-stock lines across Crisps and Snacks, Cake, Biscuits and Eat Now Biscuits are available in an easy-to-search format by store type, alongside full range lists.

A Top 20 Calculator will further allow retailers to check they are stocking the most profitable range for them by enabling stores to calculate how much of the core range they are stocking, including the value of missed sales opportunities from any lines not stocked.

The revamped website also includes tools to help outlets calculate profits from running meal-deals or multi-buy promotions. By entering product and deal details into the Meal/Snack Deal Calculator, retailers can understand the likely sales increases and margin implications of offering items on promotions such as 3-for-2.

A Top Tips section also provides promotional ideas covering PMPs, Meal Deals, Snacking Link Deals and Eat Now Biscuits. Downloadable POS on the site includes a number of standard poster and shelf barker templates that can be personalised by retailers to include details of their offers.

Retailers can check the site regularly for details of competitions and latest NPD as well as updates to the testimonials page which features real-life business building case-studies from retailers that have implemented UB Perfect Store advice and benefitted financially from the results.

The revamp of the site has been designed to provide advice and support for independent retailers, whilst helping to enhance the shopping experience for shoppers.

Emma Turner, Impulse Sales Director, UBUK, commented:

“It is essential that retailers stock the lines that consumers want and Perfect Store will help them do that.

“Our revamped site allows users to instantly access simple advice and support for their business.

“There’s a huge opportunity for independent retailers to grow their sales by making sure they follow some straightforward merchandising principles, and by simply stocking the right range.

“The new tools on our easy-to-use website will help retailers make the most of their space by stocking the lines that will work for them and in way that appeals to shoppers.”

Source:  Food & Drink Innovation Network


Companies , ,

Drop in frozen bread sales volumes hits Lantmännen Unibake’s revenue

August 5th, 2011
Comments Off on Drop in frozen bread sales volumes hits Lantmännen Unibake’s revenue

Lantmännen reports a decline in its Unibake’s operating revenue for Q2 citing factors such as a drop in sales volumes for frozen bread operations in Germany, the UK and Denmark, coupled with negative currency effects.

Lower sales volumes also reduced the operating income of the Nordic group’s pasta, breakfast cereals, flour and baking mixes division, Lantmännen Cerealia.

But Q2 net sales for the overall food division, which includes chicken production and pet food divisions along with its cereal and bakery units, amounted to MSEK 3,755 from 3,666 in the same period last year, an increase of 2 per cent, said Lantmännen.

Blaming a dip in consumer demand over the past six months, the food, energy and agriculture giant, in the interim report, notes a fall of 10.5 per cent in the Swedish consumer market for flour and mixes as an illustration of such a slowdown.

Unibake’s revenues

The group said that its Unibake division is “experiencing a lag effect in pushing through price increases in pace with rising commodity costs,” which is also affecting the division’s Q2 results outcome.

In addition, reported Lantmännen, results at the Unibake business unit, one of Northern Europe’s largest manufacturer of bakery and frozen bread products, were “adversely affected” by the operational start-up and running-in expenses associated with its recently openned UK bakery site in Bedford.

The closure of the frozen bread bakery in Glostrup in Denmark negatively impacted the food division’s operating income for the first half-year.

Nonetheless, Unibake’s operations in Russia, Poland, Finland and Sweden reported positive sales growth for the second quarter.

Bread trends

Lantmännen notes that despite relatively large downward price adjustments at Europe’s grain exchanges during the past month, grain prices remain at a historically high level, and that it is “much too early to predict what the fall prices will be, as the entire harvest period is ahead of us.”

The Nordic group’s interim report cites whole grains and fresh baked bread ‘on the go’ as the major drivers in the bread market.

Citing recently reporting finds from a European-wide poll – The Bread Barometer Survey – the company said: “Fresh baked bread is at the top of consumers’ wish lists, and the increase in demand has played a major role in the success of bake-off.

With an increased focus on health, whole grains have become a rapidly growing trend.”

And Lantmännen maintains that whole grain hotdog and burger buns, and other products not normally associated with wholegrain are gradually becoming consumer favourites in line with the general health trend sweeping across Europe.

 Source: Bakery and Snacks


Companies , ,