All product groups contributed to solid growth, 4.6% of which stemmed from price increases. Brand concepts such as Emmi Caffè Latte, Emmi Kaltbach and, increasingly, the Emmi Swiss line and products with added health benefits such as Emmi Benecol and Aktifit, continued to perform well.
In the financial year 2008, Emmi achieved net sales of CHF 2.7bn, or 7.7% growth (prior year: CHF 2,501m). Organic growth was 6.6%, or 6.7% in Emmi’s home market of Switzerland, and 6.2% outside Switzerland.
Net sales in Switzerland rose by 8.0% to CHF 2bn (prior year: CHF 1.9bn). All product groups contributed to this growth, approximately half of which was due to inflation.
The company saw sales increase by 6.6% to CHF 626m (prior year: CHF 587m) in international markets; in local currency terms, international growth equalled 7.7%. Positive developments in brand concepts and specialities for fresh products and cheese played a strong role, though the majority of growth derived from price increases.
In 2008, classic dairy products (milk, cream and butter) grew by 6.6% to CHF 804m (prior year: CHF 754m). Growth was largely due to price increases in the wake of higher raw materials costs, but also partly a result of volume growth.
Emmi’s fresh products grew by 8.2% last year to CHF 581m (prior year: CHF 537m). Primary growth drivers were again successful products such as Emmi Caffè Latte, Emmi Benecol and Aktifit. The Emmi Swiss line, including Swiss Müesli and Swiss Yoghurt, was launched in 2007; it sold very well in 2008, following its wide roll-out mainly in Germany.
Emmi posted net cheese sales of CHF 881m in 2008 (prior year: CHF 820m), representing 7.5% growth. Emmi maintained a solid level of performance in Switzerland, particularly with natural cheese. Internationally, cheese sales were satisfactory, especially in the key markets of Germany and the US, reaching growth of 6.2%.
Emmentaler AOC was subject to volume pressure caused by price increases, particularly in its key market of Italy, which led to declining exports. Brand concepts such as Emmi Kaltbach and cheese varieties (mainly Le Gruyère AOC, but also traditional fondue and raclette cheese products) performed especially well.
Emmi’s takeover of a significant production order offset high import pressure in fresh cheese, resulting in 11.6% growth to CHF 140m (prior year: CHF 125m).
Sales in powder/concentrates rose by 2.7% in 2008 to CHF 90m (prior year: 88m), primarily from increased exports in response to milk market pressure in the second half of 2008.
Sales in other products/services rose by 10.7% to CHF 196m (prior year: CHF 177m), due to positive developments in trading as well as growth in Mittelland Molkerei’s fresh products service.
Because Emmi is focused on the further expansion of its key markets, it has decided to work with local partners for its Scandinavian business activities going forward. As a result, its subsidiary Emmi Nordic AB in Gävle will cease operations at the end of February 2009.
Emmi expects to reach its earnings target of a 2%+ net profit margin for 2008. For 2009, the company has forecast stable Swiss consumption with falling prices due to lower raw materials costs. Outside Switzerland, Emmi anticipates lower consumer confidence and potentially negative currency effects, resulting in a slowdown in international business.
Detailed figures for the Emmi Group’s financial year 2008, plus an outlook for 2009, will be announced at the analysts’ and media conference on 8 April 2009.
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