Italian food group Parmalat has warned that rising milk costs could hit profits during the second half of the year.
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Parmalat issued the note of caution yesterday (25 July) when it filed its first-half financial results.
The company said the rising cost of powder and liquid milk, as well as problems in Venezuela, where the government has imposed controls on milk prices, could its profit target for 2007.
Parmalat cut its target for profit growth to 7-10% but insisted the reduction had been “more than offset” by recent disposals and gains from legal settlements linked to its 2003 bankruptcy.
During the first half of this year, Parmalat recorded a 3.7% rise in net profit to EUR163.3m (US$223.6m) for the six months to 30 June. Turnover rose 2.8% EUR1.8bn.
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By GlobalDataThe results came on the same day that a judge in Italy ordered Parmalat founder Calisto Tanzi and former CFO Fausto Tonna to stand trial on offences related to the nakruptcy four years ago.
