Cloetta Fazer is mulling whether to rejig its manufacturing base in a bid to boost profits, the Nordic confectioner’s CFO told just-food today (23 April).
The company saw its profits tumble by more than 40% during the first three months of the year thanks to soaring grain and milk powder costs.
CFO Curt Petri said the company could look to make changes to its production network, and increase prices, to improve the bottom line.
“Two-thirds of our costs come from production,” Petri told just-food. “We would not look to close any factories but maybe specialise production at some of our plants and move production of a product from one factory to another.”
Cloetta Fazer has already increased its prices once this year and the company is looking to do so again this summer.
Petri said it had become easier to get retailers to agree to price increases. “It is always difficult but it is easier than a year ago as everyone is discussing food price increases,” he said. “It takes two to tango but we have our plans [to increase prices] sometime in August and September.”
On a brighter note, Cloetta Fazer’s sales rose 6% during the first quarter. Petri said the company’s position as market leader in Finland and Russia’s growing confectionery market were key to that growth.
Petri, however, refused to be drawn on the ongoing dispute between Cloetta Fazer’s owners, a row that has cast a cloud over the company.
Cloetta Fazer has been forced to abandon plans to hold its AGM this week due to the ongoing feud between Swedish candy firm Cloetta and Finland’s Fazer Konfektyr.
Both sides had agreed to limit their stakes to 40% of voting shares but each has accused the other of breaking that deal.
Mediators have been brought in to resolve the situation and Petri would only reiterate that a solution had to be found by June, when Cloetta Fazer has to hold its AGM.