FINLAND: Slump in domestic profits hits HKScan in 2010
- HKScan EBIT drops 12.9%
- Sales drop in Finland, Sweden
- Profitability misses expectations
HKScan's Finnish business suffered in 2010
Finland-based meat processor and convenience food group HKScan today (18 February) reported a near 13% drop in annual profits on the back of a series of issues in its domestic market.
Industrial action, a ban on pork exports to Russia and competition in the poultry sector hit HKScan's profits in Finland, which fell by more than half in 2010.
HKScan's sales in Finland slipped by 1.9% to EUR718.5m (US$973.7m) but its EBIT from the market only reached EUR10.7m - down from the EUR27m it posted in 2009.
The fall in profits in Finland helped drive down EBIT at group level. HKScan's company-wide EBIT was down 12.9% at EUR48m. Net profit fell 6.7% to EUR27.9m. At the top line, net sales slid 0.5% to EUR2.11bn.
In Sweden, HKScan's biggest market by revenue, sales were also lower, dropping 3.9% to EUR997.1m. A programme designed to boost efficiency from its operations in Sweden cost EUR10m but HKScan's local EBIT benefitted from the EUR7.9m it received from selling two sites. Consequently, HKScan's EBIT in Sweden rose 22.1% to EUR20.4m.
HKScan's operations in the Baltics saw sales rise thanks in part to an aqcuisition in Latvia. EBIT, however, fell. In Poland, sales and EBIT rose due to growing exports, a strengthened position with its retail customers and tight cost control.
Reflecting on the year, CEO Matti Perkonoja labelled 2010 as a "strong year of development within the HKScan Group".
However, he added: "The profitability of the business did not meet expectations, but development programmes relating to the business and strengthening of market positions in all market areas are providing confidence in the future."
Click here for the full statement from HKScan.
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