Hernández Callejas says the rise in prices for his products in Spain “has been very contained and limited”
MADRID, 26 (EUROPA PRESS)
Ebro Foods’ net profit was reduced by 47%, to 56.7 million euros, in the first half due to the disposals of the dry pasta activities that the company carried out in 2021.
In particular, the net income on a comparable basis decreased by 12.4%, to 63.54 million euros, due to exchange differences, estimated at 12 million euros, and the loss of 20 million euros generated by the sale of Roland Monterrat, while the net income of the Spanish multinational, excluding the Roland Monterrat effect, would have increased by 8% over this period, as reported by the company.
The president of Ebro, Antonio Hernández Callejas, argued that the company had opened an action for damages to the sellers of Roland Monterrat for the losses caused. “Its sale meant a loss of 20 million euros. We have opened a claim procedure because the conditions signed during the purchase have not been fulfilled,” he explained, noting that the sandwich shop ” did not achieve the expected profitability objectives”. .
The Spanish company thus got rid of the sign which it acquired for more than 40 million euros and which it sold to a leading French agri-food operator for 22 million euros.
The group’s sales increased by 26% in the first half, reaching 1,459 million euros, thanks to the basic nature of its products in the basket, consumer loyalty and the “good management” of the supply works which allowed a “moderate rise” in its rates.
For its part, gross operating income (Ebitda) increased by 14.3%, reaching 169 million euros over this period. However, the net debt of the manufacturer of Brillante and Garofalo amounted to 718.8 million euros, or 214 million euros more than at the end of the 2021 financial year.
By business, rice sales reached €1,136.1 million through June, up 27.5%, while Ebitda stood at €146.6 million. , or 17.8% more.
An area where the president of Ebro highlighted that a “very good result” has been recorded, as well as its profitability, thanks to its “excellent” supply chain and the strength of its brands.
Regarding pasta, which was impacted by the sharp rise in raw material prices, sales amounted to 329.6 million euros, or 22.7% more, while Ebitda reached 29.2 million euros, or 6.4% less.
The “premium” dry pasta brand Garofalo, flagship of the company and “untouchable business” for the group, had a good half-year, with a 10% increase in sales in Italy, while Spain experienced a double-digit growth.
UNCERTAIN SCENARIO
Ebro described the results recorded in the first half of the year as “satisfactory”, thanks to a solid and well-diversified supply chain, the implementation of cost-saving measures, the growing investment in advertising and the innovation and strong brands.
He, however, warned of an “extremely uncertain and difficult” scenario due to inflation, consumer spending under control, changes in shopping habits and the labor market problem in the United States and in Canada, France and Northern Europe to find plant personnel.
In this way, the company expects a second half in which demand will be lower due to the end of the hoarding that occurred after the start of the war in Ukraine and the successive heat waves, which have a very negative effect on carbohydrate consumption. . .
Regarding inflation, the president of Ebro Foods estimated the cost for the company at 234 million euros and recalled that the company had increased prices, but that in the case of Spain this “increase was very contained and limited”, while in the United States, it is the country where it has increased the most due to the “skyrocketing” cost of freight.
However, Hernández Callejas stressed that inflation at these levels “is not going to continue to rise”. “We have reached a ceiling in raw materials and we can already see that wheat and sunflower oil are down. In rice, unfortunately for some types, we are going to have a tighter situation,” he said. Explain.
Regarding the change in consumption habits that is at the origin of inflation, it includes the increase in private labels. “The ones that will suffer are the intermediate brands, but not the ‘premium’ ones. What the white label grows does not take away from us, but from others”, he underlined.
COMMITMENT TO ORGANIC GROWTH
“We are very comfortable with the portfolio we have. The group is betting on organic growth rather than buying companies that we don’t know very well,” admitted the president of Ebro, after the recent sale of Roland Monterrat, that “it did not do” in the signature.
Thus, Ebro announced at the beginning of this year the acquisition of the American company InHarvest, specialized in the production of rice and quinoa, which allowed the Spanish brand to strengthen its presence in the United States.
“At the moment we have no open negotiations with anyone. We had a few attempts, but they were closed quickly. As for the disposals, they are closed because with the sale of Roland Monterrat, everything we we are doing very well”, stressed Hernández Callejas. .