HKScan, the Finland-based meat group, today (10 February) reported a fall in sales and earnings in the fourth quarter of 2015 but forecast its operating profit would grow this year.
The company posted a fourth-quarter loss of EUR1.5m (US$1.7m), down from EUR5.2m a year earlier.
HKScan made a loss at the EBIT level in the three months to the end of December, recording an operating loss of EUR600,000, down from a profit of EUR7.1m a year earlier.
Stripping one-off items including the impact of restructuring and redundancy costs, HKScan filed a quarterly EBIT of EUR11.3m, compared to EUR13.4m in the final three months of 2014. The company pointed to lower profits in Finland and Sweden.
Fourth-quarter net sales fell 4.3% to EUR501.4m. In all, HKScan said its performance in the last three months to 2015 “lagged behind expectations”.
HKScan expects its annual EBIT to improve this year from the EUR9.6m it generated in 2015.
However, the company said it believes the “economic and demand outlook” will “remain challenging”. It added: “Therefore also sales price competition will remain tough in 2016. The group’s strategy implementation, continuous improvement projects and active sales margin management should contribute to better financial performance.”
HKScan’s annual results for 2015 showed the impact of the changes it made to its operations during the year. Net profit fell from EUR57.1m to EUR1.9m in 2014, a year when HKScan benefited from the sale of its stake in a venture with Danish Crown.
Its EBIT of EUR9.6m compared to the EUR55.5m generated in 2014. Underlying EBIT hit EUR21.5m, up sharply from the EUR12.4m HKScan made in 2014.
Net sales were down 3.6% at EUR1.92bn.
Last month, HKScan announced the departure of CEO and president Hannu Kottonen after a joint decision between the executive and the company’s board. Aki Laiho, the group’s deputy CEO and COO, has temporarily assumed the position of CEO.