Goodman Fielder innovations to counter market challenges
Goodman Fielder, one of Australia’s largest and diverse food manufacturers, with brands such as Helga’s, White Kings, Praise, Crisco and Meadow Fresh, has announced its Net Profit after Tax (NPAT) for the half year ended December 31 2011. The figure was down 55% on the same period last year.
Earnings before interest and taxes (EBIT) was down 37% to AU $114 million.
The report highlighted strong retail price competition and tight margins as factors, but the company believes that brand innovation will improve its recovery strategy. New products recently launched include Helga’s Thins, Vogel’s Gluten Free, Praise Salad Dressing and Flame Flour.
Sales revenue was reported at AU $1.3 billion, down 3.7% from the corresponding period in the previous year.
Goodman Fielder remains Australia’s market leader in Fresh Loaf breads with brands such as Wonder White, Vogel’s and Flinders Bread.
Revenue was down 8.2% to $490.1 million, and earnings before interest, taxes, depreciation and amortization (EBITDA) was down 47.2%. to 43.1 million. The report highlighted reduced volumes, inability to recoup increasing commodity costs, and inability to recover fixed costs, as factors.
However, capital expenditure was up 93.9% to AU $ 22.1 million since the company invested in the Erskine Park artisan bread line, Moorebank automation and ongoing upgrades in compliance systems.
Home Ingredients division
The company’s home ingredients division maintained strong credentials as a market leader in eight of the ten top products categories in this area. The Baking Mixes category grew 27% over the half, while Dressings And Mayo grew 14% and Sweet Biscuits grew 18%. Seeded Oils and Frozen Pastries sales remained stagnant, mainly due to increased competition from home brands.
Due to difficult trading conditions, there was a 3.7% decline in total revenue for the Home Ingredients totaling AU $237 million. Earnings before interest, taxes, depreciation and amortization (EBITDA) declined by 20.4%, mainly due to higher commodity costs and increasing pressure from private labels.