FINLAND: HKScan hit by poor pork profitability
Scandinavian meat processor HKScan today (6 May) recorded a loss in its first quarter as it was hit by poor pork profitability in Finland and Sweden.
The company said today (6 May) that for the quarter ended 31 March, it reported a EUR2.7m (US$3.9m) loss against an EUR4m profit in the same period of 2010.
However, net sales grew by 22% over the quarter to reach EUR592.7m, which it attributed mainly to acquisitions. Organic growth was 4%.
Commenting on the results, CEO Matti Perkonoja said the pork supply chain in Finflan and Sweden had been affected for an "exceptionally long time by very low profitability".
Perkonoja said: "Overproduction of pork elsewhere in Europe has resulted in greater than usual pressure to import meat to HKScan's market area. Disgorgement of pork stocks - accumulated during the dioxin scandal in Germany - on the market during the latter part of the year will continue to disrupt the pork market. At the same time, in Finland, the release on the export market of stocks which arose due to the ban on exports to Russia last year is creating additional challenges for profitability in the business with respect to pork meat."
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