Italian dairy group Parmalat has said its preliminary full-year results for 2016 reaffirm its guidance of a 5% increase in net revenue and more than 17% for EBITDA compared with the previous year.

Parmalat, in which France’s Lactalis owns a majority stake, said the preliminary results, released yesterday (25 January), indicate net revenue totalled EUR6.49bn (US$6.9bn) compared to EUR6.41bn reported in 2015, while EBITDA grew to EUR459.2m, versus EUR 444.5m previously.

The results, which the group said were computed at constant exchange rates, considered recent acquisitions’ pro-forma 2015 comparative data and excluding its Venezuelan subsidiary, “confirm the expectations of the guidance”.

“At constant exchange rates and excluding the results both of the newly acquired activities in Brazil, Mexico and Australia and the Venezuelan subsidiary, the change in net revenue showed an increase of 2.5%, with a positive contribution by all areas where the group operates except for Europe, while EBITDA grew by 7.1%, thanks mainly to gains reported in North America and Africa,” Parmalat said.

The figures were “despite the negative effect caused by the massive devaluation of the Venezuelan currency versus the euro”, Parmalat said. “The contribution provided by the Venezuelan subsidiary to net revenue and EBITDA were down by about EUR490m and about EUR44m, respectively, compared with the previous year.”

Parmalat said its net financial position amounted to EUR334.4m compared with EUR310.8m at 31 December 2015. “The main reasons for this increase include: the cash generated by operating activities; the cash absorbed by extraordinary activities, mainly in connection with the acquisition of the yogurt and dairy dessert activities in Australia and the payment to BRF of the price adjustment on the net financial position and working capital of Elebat Alimentos; the cash absorbed by financing activities, mainly related to the investment of a portion of the parent company’s liquid assets with a timeframe of more than 12 months; the payment of dividends and a positive currency translation effect.”

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However, the group warned of continued uncertainties in Latin America, “particularly with regard to Brazil, due to a challenging macroeconomic context that could have an impact both on the growth estimates for that area in the coming years, with an attendant revision of the existing projections made for the development of the industrial plan, and on the valuation of the company’s assets”.

The company said: “Most of the year was characterised by an excess supply of raw milk at global level, attributable primarily to the elimination of the milk quota system in the European Union, which held milk prices at a relatively low level, albeit with significant regional differences and indications of a trend reversal in some areas, Europe in particular, starting at the end of the third quarter of the year.”

Among the countries where Parmalat operates, it said “the situation in Venezuela remains highly critical, given the economic and political uncertainty and high consumer price inflation”.

Complete and final consolidated results will be submitted to Parmalat’s board for approval on 3 March.

Parmalat signed a memorandum of understanding to acquire 11 dairy plants in Brazil from local food processor BRF in 2014.