Raisio upbeat on Benecol growth outlook

Raisio upbeat on Benecol growth outlook

Raisio raised full-year forecasts for sales and EBIT this morning (11 August) after its first-half results were lifted by the recent acquisition of the rights to Benecol in three European markets and an improved performance from UK cereal and snacks.

The Finland-based food group now expects full-year net sales to increase from last year and EBIT margin, excluding one-off items, to be "clearly higher" than the 7% reported in 2014. Previously Raisio had said it expected "EBIT to return on its long-term upward trend" but did not provide a timeframe for recovery.

In the first half of the year, to the end of June, sales increased to EUR264m (US$290.4m), up from EUR249.1m. EBIT rose to EUR23.7m in the six months versus EUR13.8m last year, excluding one-time items.

CEO Matti Rihko said Benecol was a "significant" contributor to higher operating profit and stressed the global potential to expand the probiotics brand. "The most significant part of the improved EBIT results from the acquisition of Benecol consumer product business in the UK, Ireland and Belgium in November 2014. In Poland, profitability of the Benecol business improved due to our streamlining efforts. Benecol's launch in China, in turn, opened the door to the market of the world's most populated country. It also supports Benecol’s strategically important expansion to new and growing markets of Asia after the South-Korean launch in February 2015."

In November, Raisio announced a deal to buy the Benecol business in the UK, Ireland and Belgium from affiliates of Johnson & Johnson for EUR88.4m.

Rihko also flagged a "clearly better" performance from cereal and snacks in the UK as well as "significant development work" at Benemilk.