20 May 2008
Highlights
> Sales from continuing operations €128.8m in Q3, up 7.1% with
growth of 4.3% on a like-for-like basis
> Sales €515.4 million in nine months, up 13.4%
> EBITDA €8.7 million in Q3, up 20.3% and €54.0 million in nine
months, up 19.1% and
> EBITDA ratio 10.5% in nine months
> Operating profit €39.6 million in nine months, up 23.0%,
and €3.8 million in Q3, up 39.2%
> Net income €25.1 million in 9 months, up 32.5%,
and €1.8 million in Q3, up 40.8%
> Cash generated from operations €31.9 million in 9 months,
up 21.8%
> Acquisition of D&F to strengthen Alfesca’s operations in Italy
Xavier Govare, CEO:
“In a very difficult trading environment, our results for the third quarter were satisfactory, demonstrating once again the strength of Alfesca’s business model.
The challenging environment was caused by a combination of several negative and exceptional factors, which impacted our results. These included significant increases in recent months in commodity prices that had a major effect on our raw material costs. The current economic uncertainties and increasing consumer price inflation also appear to have reduced household expenditure and consumer confidence. In addition, the weakening of the pound sterling against the euro also impacted the results of our UK business.
Despite this negative background, our results for the quarter and year to date are encouraging as overall we continue to deliver an on-going and profitable growth. With our diversified portfolio, the healthy sales performance of our salmon and prawns pillars helped to compensate the poor performance of the other two pillars of our business - the Foie Gras and Duck and Blinis and Spreadables pillars. Our growth in Q3 has been profitable with our EBITDA increasing by 20.3% compared to the same period last year, despite the exceptional increase of our raw material costs impacting certain parts of our business.
Recently, we announced the sale of Christiansen Partner, our Norwegian fish trading business, which did not fit with Alfesca’s stated focus on production of value added products. In addition, whilst we continue with our objective to grow Alfesca by establishing a new fifth pillar, we decided to terminate our discussions relating to the proposed acquisition of Oscar Mayer, the UK ready meals business. This decision was made due to raw material inflation causing the trading environment in the UK ready meals market to deteriorate and impacting the results of the company. Given the risks, we decided that the acquisition would not create value for our shareholders and would jeopardise the positive momentum that we have established in recent years. Accordingly, we determined that it was not appropriate to conclude the transaction at this time. We have in the meantime, announced the acquisition of D&F, which will help to strengthen and accelerate the development of our business in Italy.
Overall, the long term prospects of Alfesca are good and we continue to be confident of the future as Alfesca shows its strength by positively reacting to the difficult environment, which we expect to last for some time.”