European confectioner Cloetta reported a drop in sales for the first quarter as a decrease in revenue in Sweden and from its contract manufacturing business weighed on its results.
The company said that its net sales in the three months to the end of March declined by 0.8% to SEK1.35bn (US$150.4m). The group’s net result was lifted by a 1.2% gain from currency exchange. On an organic basis, sales dropped by 2%.
“Sales increased or [were] unchanged in Finland, the Netherlands, UK, Denmark, Norway and in the export markets. The increase was mainly offset by a decline in sales in Sweden and in contract manufacturing,” CEO and president Henri de Sauvage-Nolting said.
Operating profit in the period totalled SEK93m, compared to SEK108m in the prior year. Net profit was, however, higher at SEK59m versus SEK44m last year. Cloetta has focused on reducing its debt-to-EBITDA ratio and the group said the ratio has been cut to 2.34x compared to 2.78x at this time last year.
Cloetta signed a deal to acquire pick-and-mix supplier Candyking in the first quarter. Cloetta said it expects the transaction to close next week (28 April).
“Candyking, a leading concept supplier of pick-and-mix candy in the Nordic countries and UK, will strengthen Cloetta’s position within pick & mix and create substantial synergies. The synergies are expected to be gradually realised during the years 2017–2020. In addition, the acquisition will also strengthen our position within natural snacks through the Parrots brand,” Sauvage-Nolting said.