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Company info: Provimi 2010 results

Provimi shows strong performance in 2010 with a profit of €54.1 million from continued operations. In 2009 a loss of 31.3 million was recorded. Turnover in 2010 increased by 10.8% to €1.615 billion.

“Provimi has a clear strategy to focus on its core animal nutrition business. There are considerable growth opportunities in the fast growing emerging markets for our animal nutrition business today, driven by the rise in protein consumption, and we remain focused on expanding our presence in those regions,” Ton van der Laan, Group Chief Executive Officer commented.
 
Continued focus on innovation
Provimi’s innovation pipeline currently contains 40 projects, of which 20 are already in an advanced stage of their stage gate process. Eight new products will be launched and commercialised worldwide in 2011.
 
Latin America
Latin America is a key strategic region for demonstrated by continued investments including a recent acquisition of Nassa in Mexico in October 2010.
 
In Brazil the Group delivered an operational EBITDA growth of 47%. This was driven by volume growth of 23% primarily in the ruminants segment.
 
In Colombia and Argentina, Provimi is repositioning its business to better support medium and large customers in poultry, swine and ruminants.
 
Russia
Provimi has extended its position in Russia. The poultry segment contributed to the overall growth. EBITDA grew 34.8% compared to 2009. The business entered the premix and additive segments on the back of a newly created commercial organisation focussing on these segments.
 
Asia
Provimi has made considerable investments to build an Asian platform in Singapore. The team will develop further opportunities for expansion in the wider Asian region as well as build on the Group’s existing presence especially in Vietnam and India.
 
Focus will be on providing added value nutritional solutions to larger pan Asian integrators and feed millers, especially in China.
 
The Asian business has delivered a significant EBITDA growth of 10.5% in 2010.
 
North America
The North American business showed a good performance in a challenging market. EBITDA improved by 16%. This was supported by new product introductions and volume growth, especially in the swine and poultry segments which grew 3.0% and 6.8% respectively.
 
Europe, Middle East and Africa
In this region EBITDA increased 5.4% compared to 2009. France and Switzerland both delivered outstanding performances. In France, Provimi increased its premix volumes by 7.4%. Organic feed sales for poultry in France increased both in volume and margin.
 
Because of its strong presence and good performance in the country, France will remain a key growth market and Provimi will continue to invest in the region.
 
Spain and Portugal delivered good results despite difficult economic circumstances in these markets. In Portugal, the business has demonstrated strong resilience in a declining domestic feed market. Market share was maintained and even increased in rural areas.
 
In Spain the overall situation was more difficult because of the high production cost for feed producers. The Spanish business delivered good performance in premix and specialty, with volumes growth of 8% and 2% respectively.
 
In North West Europe, the Group experienced very strong volume growth in targeted countries. In the Middle East, the business benefited from the strong market growth in general with large market investments especially in poultry.
 
Central Europe
The business in Central Europe has been strategically repositioned to enable it to be more competitive in these challenging markets and to serve its customers from a more focussed base.
 
In Poland and Ukraine, EBITDA grew by 14.3%. In Poland, where Provimi is market leader, this growth was a result of restructuring and refocusing.
 
The feed market has been challenging because of a sharp increase in commodity prices and decreasing meat prices. The closure of two factories as a part of the wider operational footprint rationalisation programme and improvements in the supply chain has further improved efficiencies and lowered cost.
 
In Ukraine, the minority shareholdings were acquired and the business repositioned to better serve its customers.
 
The markets in South East Europe have been challenging due to the sharp decrease in profitability of customers. In addition, tighter credit management policies have also impacted profitability in the region, the press release stated.
 
Financials
 
Cash generated from operating activities increased to € 103.3 million in 2010 from € 49.0 million in 2009 driven by an increase in EBITDA, working capital improvements and lower interest payments.
 
Capital expenditures increased from € 34.0 million in 2009 to € 47.5 million in 2010 driven by the SAP implementation and several projects to modernise the supply chain infrastructure, particularly in Poland, Russia and Asia.
 
Related website: Provimi
 
 
 
 
 

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Dick Ziggers

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