Emmi on a European course
Lucerne (ots)
- Successful integration of the acquisitions (cheese factories and Berne-Ostermundigen dairy)
- 2003 result: powerful growth spurt thanks to acquisitions as well as market and innovation strength
- Position as Swiss market leader clearly extended
- Positioning of the Emmi quality brand consolidated in the European foodstuffs market
- Successful product launches both in Switzerland and abroad: the cholesterol-lowering Benecol yoghurt drink, the Aloe Vera yoghurt and the Aloe Vera Drink, the fat-reduced Raclette cheese, the lactose-free milk and the lifestyle drink Caffè latte
- Outlook for 2004: further sustained growth and focus on innovations both in Switzerland and abroad
Key data for 2003
in million CHF 2003 2002
1. Net sales 1,879 1,389 Earnings before interest, taxes, depreciation and amortisation (EBITDA) 118.0 80.2
Corporate profit 42.7 19.8
Emmi looks back on a successful year
In a generally more fiercely contested market, marked by increasing pressure on margins, a tense economic environment and widespread consumer reticence, the Emmi Group was able to maintain its position in the Swiss market and further extend its leading position. Emmi was unable to grow at a similar rate in the international cheese business on account of the economic climate and the changed legal framework. Nevertheless, it succeeded in strengthening its market position abroad by bringing together the foreign subsidiaries and consolidating Emmi as a quality brand.
Against the background of the difficult market environment both in Switzerland and abroad, the Emmi Group regards the overall result for 2003 as gratifying. Sales showed an above-average improvement of 35 per cent to CHF 1.879 billion - around 5% of which is attributable to organic growth. Gross profit was increased by 53 per cent. The EBITDA increased by 47 per cent despite the cost of integration. The corporate profit came to CHF 42.7 million. (2002: CHF 19.8 million).
The divisions are holding their own in their markets
Emmi's three divisions - Chilled Products, Dairy Products and Cheese - finished the year under review with differing results. The Chilled Products Division can look back on a successful year. Sales here grew (adjusted for acquisitions) by 71 per cent to CHF 461 million. It was able to clearly extend its leading position in Switzerland. Despite the difficult environment, the Dairy Products Division again turned in strong growth for cream, milk and powder and succeeded in holding its own in the butter business. It achieved sales of CHF 486 million (2002: CHF 371 million - +31%). Despite a fiercely contested market, the Cheese Division grew by 36 per cent in Switzerland and achieved sales of CHF 931 million (2002: CHF 684 million). The export market, on the other hand, proved rather more difficult in the year under review.
Emmi successfully launches new products in Switzerland and abroad
The Emmi Group's major sales boost was achieved not only through acquisitions, but also by market and innovation strength. Here, particular mention should be made of the cholesterol-lowering yoghurt drink Benecol, the Aloe Vera yoghurt and the Aloe Vera drink, the fat-reduced Raclette cheese, the lactose-free milk and the latest Emmi innovation - Caffè Latte - which was launched in March 2004 in Switzerland and important foreign markets.
The Emmi Group consolidates its company structure
For the Emmi Group, 2003 was a year of challenging and labour-intensive integrations and with it the consolidation. The task was to integrate the cheese business companies that had been newly acquired in autumn 2002 and in 2003 (Swiss Dairy Food, Tiger Käse AG, Raclette Cheese Dairy Landquart) and the Bern-Ostermundigen dairy into the Emmi Group. All in all Emmi gained 850 new employees, with acquisition-related sales growing by around CHF 500 million. It was possible to conclude all integration work according to plan. The merging of the Emmi dairies and the Berne-Ostermundigen dairy was accorded priority for reasons of synergies. The traditional fondue companies Zingg AG, Gerberkäse AG and Tiger Käse AG were amalgamated to form Emmi Fondue AG with effect from 1 January 2004. This new group company will have sales of some CHF 130 million, half of which will be made abroad. 1 January 2004 also marked the start-up date of the group company Emmi Logistik AG, the amalgamation of the former Emmi logistics service and Emmi Kühlhaus AG (frozen food logistics) in Kriens to form a single company. At the end of 2003, Nestlé Schweiz AG and Emmi AG agreed on a collaboration in the production and logistics area. In mid-2004, Emmi will take over the Hirzel production facility from Nestlé Schweiz. In turn, Nestlé Schweiz is taking a stake in Emmi AG's share capital.
The building projects are progressing on schedule
Emmi invested around CHF 17 million in the construction of the central frozen food store in Berne-Ostermundigen required for the ice-cream products of Lusso Foods AG. The project is proceeding according to plan, the building will be put into operation in September 2004.
The building extension to the Kirchberg cheese service centre in which Emmi has invested CHF 35 million, is also going according to schedule. The first production areas will be ready for occupation in autumn 2004, after which a start will be made on the refurbishment work for the existing building. The entire building project will be complete by the middle of 2005.
Emmi completes a change at the top
In mid 2003, the general meeting elected Fritz Wyss, Delegate and CEO of the Emmi Group, to become the new Chairman of the Board of Directors. Another change took place at the operational level. Member of the Group Management Walter Huber was nominated by the Board of Directors as the new Chairman of the Group Management (CEO). He took on the operative management of the company on 1 January 2004.
Outlook for 2004: Emmi is striving for further growth in Switzerland and abroad
The Emmi Group has got off to a good start in the current year. It has been able to maintain last year's successful progress. The Chilled Product Division has developed very well in the first three months. A modest upturn is emerging at Emmi in the international cheese business
For 2004, Emmi is striving for growth in the order of 4 per cent. The aim is to achieve this goal through an increase in the Swiss retail and catering market, as well as through increased export of chilled products. In terms of cheese exports, further efforts will be made to increase the distinctiveness of the products under the Emmi umbrella brand, with a view to increasing the net value added among the classic cheeses.
Innovation and quality will continue to be the most important criteria in the development of new products. Consequently one thrust will be on the expansion of the product range in the premium products area and the associated optimisation of the positioning as a quality brand.
Despite the changes in the international markets, the ongoing liberalisation process in the European Union and the stricter legal framework, Emmi is confident of its ability to further extend its position as the number 1 in Switzerland and to win further market shares abroad, principally in the main European markets as well as in the USA and Canada as an innovative supplier of processed milk products.
Emmi increases its market presence in the Benelux business area
Emmi is taking over the Dutch cheese importer and distribution partner Craamer with retrospective effect to 1 January 2004, thereby boosting its presence in the Dutch market. Both parties have agreed not to disclose the purchase price. The acquisition provides Emmi with an optimum marketing and sales platform and thus greater market proximity for the entire Emmi product range. From Emmi's perspective, the Benelux business area has significant development potential for Swiss milk and cheese products in the quality sector.
Craamer achieves a major part of its sales volume through the sales of Emmi natural cheese as well as with Tiger products, making it one of the most important distribution partners in the Netherlands. Until further notice, the Tiel-based company will continue its sales activities under the present management.
Contact:
Emmi
Stephan Wehrle
Head of Corporate Communications
Phone: +41/41/227'27'86
Emmi AG
Habsburgerstrasse 12
CH-6002 Lucerne
Phone: +41/41/227'27'27
Fax +41/41/227'26'63
E-Mail: info@emmi.ch
Internet: www.emmi.ch