Bega triumphs despite global challenges ahead
Bega has posted a $15.7 million profit for the first half of its 2017 financial year whilst competitor Murray Goulburn has reported a significant loss.
Despite Bega’s success, and a predicted turnaround for the currently turbulent dairy industry, Bega has pre-warned the market of challenging times ahead.
For the first half of its 2017 financial year, Bega achieved an after tax profit of 8.2 per cent on its 2016 first half results.
Bega said growth in its retailers own brand business, an improvement in global dairy commodity prices and increased first half sales in its nutritional business all positively contributed to the revenue and profit improvement.
“I am very pleased to present a strong first half performance particularly in the context of the recent upheaval in the Australian dairy industry, a highly competitive retail environment and significant disruption in infant formula supply channels into China,” Bega’s Executive Chairman, Barry Irvin said.
While pleased with the results, Irvin said he expected the second half of the year to be more challenging and said end of year results will be broadly in line with what was achieved in Bega’s 2016 end of financial year results.
Ingredients market improving
Newly appointed Chief Executive Officer, Paul van Heerwaarden, said whilst nutritionals is having a tough year, the ingredients market is improving rapidly.
“We always remain alert to changes in the market and supply and demand dynamics endeavouring to position ourselves to be agile enough to meet challenges and respond to opportunity,” he said.
Vegemite, Kraft transition going smoothly
The first half of the company’s 2017 financial year included its acquisition of Vegemite and a number of Kraft products from Mondelez International.
Both Bega and Mondelez are now implementing a transition plan with the aim of completing the transition over to Bega by the end of the 2017 financial year on 30 June 2017.
CEO Heerwaarden said Bega was happy with the progress of the transition and the excitement the acquisition has created in the community.
“There is no doubt that in the future we will look back on the past six months as one of the most significant periods in the Company’s history,” Chairman Irvin said.
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