Dutch food maker CSM today (28 October) reported “substantially improved” third-quarter earnings and said annual profits could rise by as much as 15% this year.
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The company, which claims to be the largest supplier of baker products worldwide, booked EBITA of EUR47.6m (US$70.4m), up sharply from EUR26.8m in the third quarter of 2008.
The rise in profits came despite a dip in revenues, which fell 2.2% to EUR634.5m due to lower volumes and average prices.
CEO Gerard Hoetmer said: “This quarter’s development in raw material prices was less volatile than in previous periods. This allowed us to recover margins. However, continued attention will have to be paid to our procurement positions and selling prices especially as the first signs of raw material price increases are seen.”
Hoetmer said average raw material prices had started to rise again but admitted forward purchasing contracts would mean the price impact in the fourth quarter would be “limited”.
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By GlobalData“For the fourth quarter we remain cautious for the volume outlook. As Q4 is the most important quarter for our bakery activities, the behaviour of consumers in this holiday season is going to be very decisive for our results in this quarter,” Hoetmer said.
“On balance we estimate our Q4 EBITA to improve over Q4 of last year. For the total year we expect to improve our EBITA with 10-15% compared to last year.”
