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| Devro Report Continued Growth In Collagen Sales Including New Premium Sausage 'Select' Range For |
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 Devro have reported a 7% growth of their global collagen business, with highlights to the last financial year including the establishment of the new ‘Select’ range of alternatives to sheep gut for premium sausages, with sales continuing to grow in South East Asia, Russia and Eastern Europe.
Commenting on the results and the outlook for 2012, Steve Hannam, Chairman said,
"I am delighted to report that 2011 was a year of further growth in the business, improved financial
performance and significant progress with our strategy. . The fundamental growth prospects for our global markets remain encouraging. With our evolving product range and strategic capital investment programme, we are well placed to take advantage of this opportunity. The strong performance in the second half of 2011 and the continuing strength of the balance sheet give us confidence for the future.”
The global market for collagen casings continues to grow, driven by economic expansion and increased meat consumption in emerging markets. High sheep gut prices and limited availability are also providing more opportunities in developed markets for substitution by collagen casing.
Devro’s ‘Select’ range of products, which was launched last year specifically to replace sheep gut in premium sausages, has made excellent progress in Japan and Northern Europe. Sales have increased month by month and represented 4.3% of total sales in 2011. Additional trials are under way and Select presents an excellent opportunity for further growth in 2012.
In developing markets, Devro saw further good sales growth in Latin America, Eastern Europe, and Russia.
During the year the sales team in Hong Kong was strengthened and a representative office was opened in
Beijing. The increased focus has already produced higher sales in South East Asia and a number of customer trials are underway in China.
The year was very much one of two halves with earthquakes, floods and severe weather affecting the markets and production performance in several regions in the first half. These were not a factor in the second half and the business had a strong finish to the year. Yield improvement and cost reduction programmes have continued to produce benefits and each of our sites has been accredited to FS22000, the new global standard for food hygiene management.
To concentrate further on our core business of collagen casings and to strengthen sales activities in Europe, Devro GmbH was sold to ViskoTeepak Holdings Ab Ltd in September.
In 2011, the global demand for edible collagen casings continued to increase, albeit with considerable
variations between markets and regions. Developed markets were generally subdued, reflecting the economic situation. In emerging markets, there is long-term growth arising from increasing disposable income and urbanisation, generating stronger demand for all proteins. Current estimates indicate that the global market for collagen grew by as much as 10% in 2011, with China again making a significant contribution to this.
For Devro, with a strategy of seeking value and profitable sales, total volume growth during 2011 was 4.6%. This was largely due to the growing demand for Select casings, a highly innovative product introduced in 2010, specifically designed for developed markets to replace sheep gut in premium sausages. In 2011, 4.3% of Devro’s edible collagen sales volume, was Select casings.
The product development and marketing efforts that we have devoted to Select worldwide form the first part of our strategy to grow sales in established markets, where the total demand for sausages is not increasing but where there are still significant opportunities to replace sheep gut at good prices, especially where Devro already has well-established distribution arrangements and sales teams in place.
Throughout the world, supply of top quality sheep gut was constrained in 2011, resulting in further price increases.
In Europe, Select casings manufactured at the Scottish and Czech plants are now being sold to over 40 customers in 13 countries, from the Baltics and Scandinavia to Russia and Ukraine. A prime objective for Select is to increase Devro’s share of the German market, where Select accounted for 29.1% of our sales during the year.
In the UK, strong supermarket discounting and promotion of certain segments led to a slight reduction in the share of sausages sold in collagen casings. The resultant effect on Devro’s sales volumes was offset by improved UK pricing and the opportunity to export a greater proportion of our UK production to meet growing demand in other markets. |
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| Item last updated: Wednesday February 15 2012 09:37 |
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| Consumer Demand For Clean label Ingredients Fuels Kerry Growth |
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Kerry Group's ingredients & flavours businesses grew steadily in all regions benefiting from Kerry's breadth and depth of technology and 1 Kerry approach to market development providing industry-leading integrated solutions over the last year.
While consumer spending remains constrained due to fiscal pressures, demands for all-natural and clean label solutions continue to grow as does the requirement for healthy reformulation, well-being and diet-specific offerings.
Kerry's 'go-to-market' strategies, capitalising on its broad global ingredients & flavours development, technology layering opportunities and end-use-market focus continued to deliver stronger customer engagement and innovation in all regions in 2011.
Sales revenue increased on a reported basis by 8.5% to €3,706m, reflecting 7.7% LFL growth. Business volumes grew by 4% and pricing/mix increased by 3.8%. Trading profit increased by 9.4% LFL to €439m with the division's trading margin improved by 10 basis points to 11.9%.
Innovation continues to be driven by increasing consumer demand for 'free-from foods', reduced calorie, reduced salt, reduced fat, higher-fibre, natural flavours and ingredients, enhanced nutritional and dietary products, in addition to continuing trends towards more convenient, cost-effective solutions, healthy snacking options and affordable indulgence; favouring development through Kerry's range of ingredients, flavours, texture, nutritional and taste solutions.
In December Kerry completed the acquisition of Cargill's global flavours business. The business, acquired for a total consideration of US$230m, serves a global customer base through provision of flavour ingredients and flavour systems for beverage, dairy, sweet and savoury applications. It has long standing relationships with leading global food and beverage manufacturers through its integrated flavour development and application centres in France, the UK, South Africa, India, Malaysia, China, the USA, Puerto-Rico, Mexico and Brazil - supported by a network of sales representative offices in 12 other countries.
All Group technology clusters achieved satisfactory growth in 2011. Revenue grew by 7.9% in Savoury & Dairy systems, 5.4% in Cereal & Sweet systems, 12.6% in Beverage systems, 9.1% in Pharma, Nutritional & Functional ingredients and by 11.2% in Regional Technologies.
Americas Region
Revenue in the Americas region grew by 7.1% LFL to €1,558m. Business volumes increased by 3.3% and pricing/mix increased by 3.8%.
Savoury, Dairy & Culinary systems & flavours performed well throughout the region. Good growth was achieved in the yoghurt market through innovative lines in multiple product formats including ice cream applications and smoothie kits. Progress accelerated through formed sauces, dairy systems and dairy flavours in the prepared meals and side dishes categories. Savoury snacks provided good growth opportunities through regional snack manufacturer accounts and all-natural snack product suppliers incorporating Kerry's clean label flavouring systems. Coatings systems recorded solid growth in the meat sector and successful integration of new flavours into meat systems produced excellent results in the poultry sector. Foodservice applications grew year-on-year, as growth in particular through quick-serve-restaurants rebounded to pre-recession levels. In Latin American markets the meat, dairy and snack sectors saw double digit growth in 2011 providing good opportunity for Kerry's integrated systems & flavours.
Cereal & Sweet systems & flavours' performance improved as the year progressed, assisted by Kerry's integrated solutions approach. The ice cream and frozen desserts sector provided solid Kerry innovation opportunities for bite-size snackable offerings and frozen novelty lines.
Demand for improved health and clean label offerings in the bakery sector led to good growth in Kerry's complete technology offering including flavours, shelf-life extenders, bio-ingredients and functional ingredients. Demand for particulates also grew through in-store bakery and foodservice channels. Snacking trends and seasonal product introductions also provided good growth opportunities in the confectionery category.
Kerry's sweet systems & flavours achieved continued strong growth in Latin American markets benefiting from the expansion of sweet inclusions process capabilities in Mexico and Brazil. Despite sectoral challenges in the RTE cereal market Kerry continued to record good progress through key accounts and the successful introduction of infant cereal lines. The bar segment also provided new development opportunities for Kerry's integrated solutions. Market development in Latin America was advanced mid-year through the acquisition of General Cereals S.A. in Argentina.
EMEA Region
Revenue in the EMEA region increased by 6.9% LFL to €1,475m. Business volumes grew by 2.7% and while there was some lag in cost recovery, the increase in input costs was substantially recovered with pricing/mix increased by 4.2%.
Savoury & Dairy systems & flavours performed above industry average but performance varied across end-use-markets and regional markets due to the impact of cost recovery initiatives. Meat coating systems performed well through added value poultry applications for retail and quick-serve-restaurant markets. The momentum towards clean label solutions led to increased uptake of Kerry's SFT TM all-natural shelf-life extension technology in the meat processing industry. Savoury flavours, cheese systems and snack seasonings achieved good growth in the snack sector. Prior to year-end the Group also acquired Durban, South Africa based FlavourCraft - a leading developer and provider of savoury flavours and seasonings for soup, sauce, prepared meal, snack and meat applications serving EMEA markets in particular developing markets in Africa. Dairy systems & flavours, proteins and enzyme technologies experienced good growth throughout European markets in 2011.
Proteins achieved solid growth in the nutrition and confectionery sectors, in particular through hypo-allergenic hydrolysed proteins for infant nutritional products and through functional proteins for confectionery applications in developing markets. Cheese systems continued to record strong growth in the foodservice sector throughout all EMEA markets. A major investment programme was completed at the Listowel plant in Ireland to expand dairy flavour production capabilities and capacity.
Cereal & Sweet technologies saw good growth in the dairy & cereal bar markets and also through foodservice applications. Sweet systems recorded strong development in the ice cream market through successful innovation in the premium segment incorporating Kerry's cluster technologies and coating capability. The acquisition of SuCrest in October significantly expanded the Group's sweet ingredients & flavours business in the EMEA region. With production and product development facilities located in Hochheim, Germany and Vitebsk, Belarus and a sales representative office in Moscow, SuCrest is a leading provider of sweet ingredients to the bakery, ice cream, confectionery, cereal and snack sectors in European markets.
Kerry's integrated technology approach incorporating sweet systems, dairy systems, fermented ingredients and emulsifiers continued to provide good opportunity for growth in the bakery sector. Demand for indulgence applications in the fine bakery category was adversely impacted by restrained consumer spending. Market development in the RTE cereals sector was also weaker as manufacturers reconfigured brand portfolios in response to the high level of promotional activity and changing consumption patterns.
Asia-Pacific Region
Revenue in the Asia-Pacific region grew by 12% LFL to €605m. Business volumes increased by 10% despite a series of natural disasters which impacted the region. Pricing/mix increased by 2.8%.
Savoury & Dairy technologies recorded strong organic growth throughout Asia-Pacific markets. Dairy systems performed well in the snack and bakery markets in Malaysia and the Philippines. Cheese systems continued to grow in Japan and China, in particular for snack and biscuit applications. Lipid systems grew satisfactorily in the infant nutrition sector but the significant sectoral input cost increases adversely impacted performance in the tea & coffee end-use-market. China continued to provide a strong platform for growth in the infant nutritional sector. Culinary systems performed well throughout Asia, with good progress in the growing snack markets in Indonesia, the Philippines and Vietnam, and excellent growth through sauce applications in China.
Meat technologies grew strongly in Australia and New Zealand with good growth in the QSR sector and through added value poultry applications. The acquisition of EBI Cremica during the year has provided a platform for growth through coating systems in the food processing and foodservice sectors in India. A new applications centre was opened in Delhi to support savoury, culinary and beverage development. An infant nutrition spray drying facility was also commissioned at the Penang plant in Malaysia.
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| Item last updated: Wednesday February 15 2012 09:37 |
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| Campden Announce New Research Projects |
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With around £2M funds available, Campden BRI members recently voted for the research projects they want to be carried out through 2012 and beyond.
The following projects started in January 2012:
* An integrated approach to sensory evaluation of product and packaging
* Better package seals for reducing product waste Food safety risks associated with pathogens recently linked to foods
* Good Agricultural Practice and sustainable food production
* How do product health claims influence consumer choice?
* Impact of product reformulation on microbiological stability Improving process control for reducing energy use in food production
* Next generation techniques for ensuring product safety
* Product reformulation - replacement of hard fats and oils
Director-General Professor Steven Walker commented: "These new projects demonstrate the wide variety of research that we undertake at Campden BRI, which in turn is an indication of the breadth and depth of our expertise. Our current programme covers about 50 projects. In addition to our member-funded research, we also undertake work for UK government departments, the EU and other bodies."
More details on these and on-going projects are available on the Campden BRI website at www.campden.co.uk/research/strategic.htm, and in "Research Programme 2012", which has just been published. To receive a free electronic copy of the Research Programme, send an e-mail to auto@campden.co.uk with the subject line: send RP2012 |
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| Item last updated: Wednesday February 15 2012 09:37 |
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