Turnover figures for the 2010 financial year
Hochdorf, February 1, 2011 – The HOCHDORF Group processed 325.9 million kg of milk in Switzerland in the past business year – the second largest amount in its history. HOCHDORF surpassed the previous year’s amount of 320.4 million kg by 1.7%. The consolidated gross turnover amounts to CHF 351.7 million despite lower milk prices – and therefore lower product prices (previous year: CHF 347.6 million; +1.2%). The Group has succeeded in turning the situation around, which means that an unchanged dividend is the very least shareholders can expect.
The HOCHDORF Group produced 325.9 million kg of processed milk in the past year – the second highest milk processing result in the company’s 115-year history. HOCHDORF only produced more milk in Switzerland in 2008 (360 million kg) in what was a particularly strong year for milk production. With 13 million kg of processed whey and the amount of milk produced by the Lithuanian plant (71.6 million kg), the HOCHDORF-based Group achieved record figures for processed liquid quantities at 410.5 million kg.
Significant growth in strategically important areas
In the past business year, the HOCHDORF Group achieved a consolidated gross turnover of CHF 351.7 million (not audited; previous year: CHF 347.6 million). This represents a small increase in gross turnover of +1.2%. The Lithuania plant is already fully integrated in the figures because HOCHDORF will take it over entirely in the medium term. The higher turnover was achieved despite lower average milk prices and therefore lower product prices. The previous year’s turnover also includes the turnover shares from the divested business areas amounting to CHF 13.5 million.
The Group’s sales volume (non-consolidated) was 94,657 tonnes, even surpassing the record value from the previous year (82,589; +14.6%). This volume growth was achieved with constant warehouse quantities. The comparative value from 2009 was also achieved due to huge warehouse sales. The HOCHDORF Group also attained substantial growth in strategically important business areas. It sold 1,828 tonnes (+37%) more infant formula and 1,100 tonnes (+8.9%) more full milk powder for the Swiss chocolate industry.
An intensive business year
2010 was a very challenging business year, both economically and politically. The strong Swiss franc hindered the export of quality Swiss foodstuffs such as infant formula, chocolate or biscuits. The “Schoggi” law contributions made available by the Swiss government to offset the handicap posed by domestic raw material prices proved far from adequate for the purpose. The HOCHDORF Group estimates its milk quantity exported in the form of infant formula, chocolate or biscuits at approximately 110 million kg. This is a considerable quantity of milk that would be lost to milk producers if the foodstuffs-processing industry were to make use of the active inward processing arrangements. Fortunately an agreement was reached within the industry to offset the missing contributions from the “Schoggi” law.
The HOCHDORF Group achieved its own internal capacity target for the new, ultra-modern spray tower line 8 in Sulgen. This involved a huge effort in the areas of production and marketing. The plant has already been running as a three-shift operation since December 2010. The plant volume will virtually double in 2011, which is what is required to achieve the target growth in the area of powdered infant milk formula.
Growth abroad as well
At the beginning of 2010 the HOCHDORF Group assumed an interest in the MGL Baltija UAB milk plant in Medeikiai, Lithuania. This plant provides the HOCHDORF Group with a foothold in the EU and with direct access to the east European market. The Group increased its share from 30% to 45% as of January 1, 2011 and will take over the milk plant completely in the medium term.
Projection for 2011
The optimisation and restructuring measures initiated by the HOCHDORF Group in 2009 and consistently pursued in 2010 have proved successful – and the business has been turned around. The Group is therefore expecting positive financial results for 2010. “With the investments we have undertaken, along with process improvements and divestments, we can look forward to the future proactively and with confidence,” says Damian Henzi, CEO of the HOCHDORF Group. Henzi adds: “The HOCHDORF Group must and will retain its focus on achieving EU cost compatibility and internationalisation.” The rising milk powder prices on the world market also give grounds for optimism in 2011. And some product prices were also adjusted upwards.
Dr. Christoph Hug, Corporate Communications, HOCHDORF group, Tel: +41 (0)41 914 65 62 / +41 (0)79 859 19 23, email@example.com
The HOCHDORF Group, with headquarters in the town of Hochdorf in the canton of Lucerne, is one of Switzerland’s leading companies in the food sector and in 2010 generated consolidated gross sales of CHF 351.5 million (CHF 346.3 million in 2009) with a workforce of 377 (status as at: 31.12.2010) at three sites (Hochdorf/LU; Sulgen/TG; Medeikiai/ Lithuania). HOCHDORF develops, produces and markets functional ingredients as well as dairy and cereal-based speciality products for the food industry and the trade worldwide. HOCHDORF’s products, which are extracted from natural raw materials such as milk, or wheat germs, have been making a contribution towards the health and well-being of infants right up to senior citizens since 1895. The products are sold in approx. 80 countries.