SWEDEN: Costs hit Cloetta earnings
Swedish confectioner Cloetta said today (24 June) that its earnings have been dented by continued high costs.
During the third quarter the company made an operating loss of SEK8m (US$1m), down from an operating profit of SEK3m. For the first nine months of the year, the group's operating profit totalled SEK22m, down from SEK32m the previous year.
"Raw materials costs have hurt earnings, with the weakened krona pushing costs up further," a spokesperson for the company said.
While the company's demerger with Fazer has negatively impacted net sales, sales of Cloetta products have continued to witness from growing demand, the spokesperson emphasised.
Net sales, including Fazer products, dropped to SEK237m in the third quarter, down from SEK305 last year. However, excluding Fazer products, sales rose by about 7% for the nine-month period, the spokesperson said.
Cloetta has said that, following last year's demerger from Fazer, it will not be possible to reduce expenses to offset the drop in net sales in the short term. The company has forecast a negative operating margin and a loss for the current financial year.
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