Major food multinationals last week reported their first-half results. Unilever saw food volumes fall, PepsiCo insisted it had “momentum” in Europe, Hershey believed US candy had reached a new growth phase and Danone faced criticism from analysts. Elsewhere, the UK milk farmers’ protests appeared to pay off, with processors shelving plans for price cuts.
“Our performance in tea and parts of food is getting better but not sufficiently good yet everywhere. Our service and quality levels are still not good enough in some important markets. Our inventory levels, although improving, are simply still too high” – Unilever CEO Paul Polman demands more from the consumer goods giant’s food business.
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“We continue to build momentum in our Europe business, despite the well-known economic challenges there” – PepsiCo CFO Hugh Johnston insists the US group put in a resilient performance in Europe in the first half of the year.
“We feel as though the category growth is – I used the word, I think earlier – around the new normal” – the US confectionery category is in a new phase of growth, according to Hershey president and CEO J.P. Bilbrey.
“We expected a very uninspiring reporting and that is what we got…very much in-line with deflated expectations” – Sanford Bernstein analyst Andrew Wood on Danone’s first-half results, which came six weeks after a profit warning from the company.
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“The drought has the potential to increase retail prices for beef, pork, poultry, and dairy products first and foremost – later this year and into 2013” – the US Department of Agriculture warns the drought in the country could push up food prices into next year.
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By GlobalData“We are in no doubt about the difficulties that the farmers affected by the forthcoming August price cut have been facing. Our bold move to set aside this cut for two months will allow us to continue to work with our farmers to find long term solutions” – Dairy Crest milk procurement director Mike Sheldon after the UK processor announced plans to postpone its plans to cut milk prices for farmers. Rival dairy companies, including Arla Foods, Robert Wiseman Dairies and First Milk, have withdrawn their plans.
“I think seeing Fairtrade increasingly emerging as a global model that is equally shared between north and south is potentially very, very exciting” – Fairtrade Foundation director of policy Barbara Crowther on the growth of the certification in markets like South Africa.
“We’ve done a hell of a job!” – Sergei Galitskiy, CEO of Russian retailer Magnit, after the company’s leap in half-year profits.
“Bacteria such as salmonella and e.coli travel with the meat. Therefore, they come into a meat processing facility with the animals that are harvested, travel with the meat and depart with the meat. This is not a systemic facility-type issue that might be the case with something such as listeria” – Cargill on its investigation into salmonella contamination at a site in the US, which has been linked to illnesses in seven states.
“China/Hong Kong continued to deliver strong sales growth; however, we expect lower growth in the second half of the year in light of recent data indicating both a slowdown in the China category and a decline in Mead Johnson’s market share” – Mead Johnson Nutrition CEO Stephen Golsby says the US infant formula’s growth will slow in China, which has forced it to lower its company sales forecast for 2012.
