•  Sales up 2.6%
  •  Operating profit gains
  •  Net income up 45%
Bongrain profits rise

Bongrain profits rise

French cheese maker Bongrain has booked an increase in sales and earnings for fiscal 2012, boosted by the contribution from acquisitions.

The group said net sales rose 2.6% to EUR4.08bn (US$5.3bn), with organic sales up 0.5% and the acquisitions of Milkaut and Sinodis adding 1.4 percentage points to the top line.

Operating profit rose to EUR132m, up from EUR107.9m in 2011. The company said the improvements were the result of a better product mix and growth in dairy and cheese businesses outside Europe. These gains were partially offset by rationalisation costs and impairment losses in Spain. "In several European markets, cheese products suffered from the crisis situations," the group added.

Net profit rose 45% in the year, climbing to EUR63.6m.

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Net sales increased by 2.6% including 0.5% of organic growth and 1.4% attributable to the consolidation of Milkaut with effect from February 2011 and Sinodis with effect from October 2011. Organic growth for cheese products amounted to 1.2%, thanks to the contribution of major brands, but slowed down in the 2nd half of 2012 compared to the trend of the 1st half. Other dairy products declined by 0.4% reflecting the change in world prices for industrial products. 
The growth in current operating profit reflects improved product mix overall as well as growth in both other dairy and cheese products outside Europe. In several European markets, cheese products suffered from the crisis situations. 
Current operating margin amounted to 3.7% for 2012 compared with 3.3% for 2011. 
Operating profit also reflects rationalization costs as well as impairment losses pertaining to the situation in Spain. The Group's share of net income has risen by 45% over 2011. Its financial position remains sound with net debt at 27% of equity.

At the Annual General Meeting to be held on 25 April, the Board of Directors will propose the distribution of a dividend amounting to €1.30 per share.

Share capital reduction 
In the framework of the authorization provided at the Annual General Meeting held on 28 April 2011, the Board of Directors has decided to cancel 1,399,286 treasury shares amounting to 9.1% of the company's paid-in capital. This will have no impact on the composition of voting and dividend rights.

Outlook for 2013 
The global macroeconomic situation remains uncertain and continues to condition both household consumption and the trend in world prices for industrial products. Activity levels in early 2013 were stable compared to the end of 2012. Bongrain SA has signed a declaration of intent with the Terra Lacta Cooperative. The proposal, subject to several preconditions, provides for merger of the respective industrial products' operations as well as for the constitution of a cheese specialty joint venture based in the Charente Poitou region of France.


Original source: Bongrain