Swiss food manufacturer Huegli has blamed higher commodity costs for a plunge in half-year profits.
The firm, which makes organic consumer brands and supplies other food manufacturers, as well as retailers and foodservice operators, booked a 24% drop in net profits for the six months to the end of June, to CHF8.5m (US$8.75m).
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Operating profits dropped by almost 26% on the same period of last year, to CHF12.3m.
Net sales, meanwhile, fell by 3.4%, to CHF164.4m, despite growth in the firm’s private label division and its health and nutrition unit in the UK. On an organic basis, exlcuding currency swings, group net sales rose by 1%.
“Earnings are depressed by the altogether higher raw materials prices for agricultural commodities, and additionally by the great drought ravaging certain areas in the USA in this summer,” said the group today (17 August).
For the full-year, the company said it expects organic sales to rise by 2%, although net sales could be flat to currency pressure.
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