Atria booked an increase in first-half sales but confirmed the issues in Finland and Russia that prompted a profit warning in April are continuing to weigh on profits.
The meat group said sales rose to EUR698.4m (US$941.4m), up from EUR692m in the comparable period of 2013.
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However, EBIT fell to EUR5.8m, down from EUR10.9m. Pre-tax profits slid to EUR4.1m from EUR4.8m in the comparable period of last year. Earnings were hit by the performance of the group’s business in Finland and Russia. In Finland, EBIT fell to EUR6.2m from EUR14.1m, while in Russia losses widened to EUR3.2m from EUR2.8m.
In April, the company lowered its earnings forecast. Atria said it anticipates EBIT for the 12 months to be “clearly lower” than 2013’s operating profit of EUR37m. Atria had previously been forecasting earnings growth.
“The EBIT forecast was adjusted due to the difficult conditions in the Finnish and Russian meat markets. An oversupply of pork and tougher competition have decreased sales prices both in Finland and elsewhere in the EU,” the company said this morning.
“Russia’s import ban on EU pork and the weakening of the rouble have raised the price of meat raw material in Russia by over 30% from the beginning of the year. Because of the highly competitive market situation, Atria Russia has not been able to pass on the rapidly-increased raw material costs to sales prices.”
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