Cloetta hails Q3 progress

Cloetta hails Q3 progress

A third-quarter profit meant Sweden-based confectioner Cloetta has made a "step in the right direction", its chief executive said today (16 November).

Bengt Baron was upbeat after Cloetta, which now comprises the old Cloetta and former Dutch confectioner Leaf International after the two companies merged earlier this year, posted a net profit of SEK13m (US$1.9m) for the three months to the end of September.

The result compared to a loss of SEK13m last year. Figures from 2011 are the numbers generated by Leaf, a spokesperson said.

"The reason is that the merger with Cloetta was a reverse take over and reverse accounting comes in to play, meaning that historical figures are only old Leaf. Old Cloetta is seen as an add-on," a spokesperson said.

However, the new Cloetta's third-quarter underlying EBITDA was lower, falling from SEK159m last year to SEK128m. Moreover, Cloetta's loss for the period to the end of September was SEK228m, compared to SEK192m a year earlier. The company's bottom line was affected by costs linked to the merger of Cloetta and Leaf International earlier this year and the subsequent restructuring of the business.

Nevertheless, Baron said: "The third quarter was a clear step in the right direction. We are executing our plan and I am convinced that the integration process and factory restructurings will generate significant cost savings, something that will create an even stronger company in the longer term."

Baron said Cloetta's underlying EBITDA had been lower volumes and higher promotions but added: "The decrease is less than in the two preceding quarters and there is some gain of momentum."

Sales were up 3.1% but underlying net sales, which exclude foreign exchange and recent disposals, fell 3.2%.