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March 24, 2015

Charges hit Emmi FY earnings

Emmi booked a drop in full-year earnings today (24 March) as one-time charges hit the bottom line. On an adjusted basis, however, the Swiss dairy stressed 2014 profits were up on 2013.

Emmi booked a drop in full-year earnings today (24 March) as one-time charges hit the bottom line. On an adjusted basis, however, the Swiss dairy stressed 2014 profits were up on 2013. 

Emmi revealed a 19.2% dip in EBIT, which declined to CHF136.2m (US$140.7m), and a 24.6% fall in net profit, which dropped to CHF78.9m. The company attributed the decreases to one-off items such as impairment charges relating to its Italian unit Trentinalatte. CEO Urs Riedener commented: "The adjustment has a substantial negative impact on our income statement, but the adjusted figures clearly show that Emmi is on the right path in terms of profitability."

On an adjusted basis, profits increased in 2014. Operating profit stripping out non-recurring items rose 6.7% and adjusted net profit was up 12.1%. 

Net sales in the year totaled CHF3.4bn, a rise of 3.2%. Emmi said it saw “encouraging” growth in the saturated Swiss market, where sales increased 1.3%. Elsewhere, the Americas, Europe and global milk trade units all expanded the top line with sales up 2.7%, 8.3% and 13.2% respectively. 

Looking to 2015, Emmi forecast a drop in sales due to the negative impact of the strength of the Swiss franc. Group sales are expected to drop 2-3% in the 12 months. However, Emmi also reiterated its medium term sales forecast range of positive 2-3%. 

"Emmi is doing everything in its power to ensure that Swiss dairy products continue to have sufficient sales potential in international markets. Nevertheless, currency effects will have a negative impact on Emmi’s performance in 2015. Emmi expects a markedly negative currency translation effect and an additional organic decline in sales. Emmi also expects a decline in income," the company concluded. 

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