Parmalat profits on high Aussie volumes and low euro
Italian dairy group Parmalat has reported a rise in first-quarter profits as sales were boosted by higher volumes in Australia and Venezeula, and the weakness of the euro.
Parmalat, which in Australia produces Paul’s, Vaalia, PhysiCAL, Oak, Ice Break and Breaka, booked a net profit of EUR 50 million (A$66.74 million) for the three months to March, an increase of 3.1% on the year.
In an earnings release that made little mention of the full takeover bid for the company from shareholder and French dairy giant Lactalis, Parmalat reported EBIT of EUR 58.7 million, up 5.6%
Turnover was up 8.9% at EUR1.03bn, with Parmalat citing improved volumes in Australia and Venezuela and a fall in the value of the euro against the main countries where the company operates.
However, Parmalat also revealed a 10.8% fall in EBITDA to EUR70.2m due to higher raw milk prices in Italy and Australia. The company also pointed to costs from a fire at a plant in Italy and from the floods in Australia.
The Centrale del Latte di Roma plant affected by the blaze restarted production during the second quarter of the year, Parmalat said.
The company confirmed its sales and EBITDA forecast for 2011. It is targeting revenue of EUR4.4 billion and EBITDA of EUR385 million.
Looking ahead to the rest of the year, Parmalat said “positive trends” in Canada, South Africa and Venezuela “should help mitigate the risk” from volatile commodity prices due to political instability in Africa – and the fall in prices in Australia after the floods.
Parmalat is mulling Lactalis’s EUR3.4 billion takeover bid, which was tabled earlier this month. The Italian firm said nothing beyond the existence of the offer in its earnings release.
Reports in Italy, meanwhile, yesterday claimed that police had raided banks and PR firms in an investigation into alleged market rigging and insider trading when Lactalis built its 29% stake in Parmalat in March.
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