Scandinavian Poultry, the poultry meat division of Swedish meat group Spira, is carrying a heavy burden to keep the troubled company afloat. A strong increase in earnings in the poultry division helped to set off a SKr111m (US$10.5m) operating loss in the Samfood processed pork and beef unit, narrowing the nine-month group loss after net financial items to September to SKr135m compared with a SKr160m loss in the year-ago period on group sales rising 6% to SKr3.3bn.
The Scandinavian Poultry division, which mainly operates in Denmark and Sweden, increased operating profits to SKr72m from only SKr5m a year ago.
Managing director Per Nyqvist said sales had benefited from the BSE and foot and mouth disease plaguing the European beef sector earlier this year, giving poultry meat double-digit growth sales figures. He warned however that demand was beginning to slack, especially in its north European markets outside Denmark and Sweden. Tough competition was coming not least from South American poultry operators, he said. Nyqvist was nevertheless confident poultry meat would be able to grow at its more long-term growth rate of around 9% even this year.
Although the pork and beef division increased its nine-month operating loss to SKr111m this year compared with SKr100m last year, Nyqvist reiterated his plans for Samfood to reach break-even in Q3 2002. It is unclear how likely it is that his objective will be met.