News Annual figures
Aviko also contributes to Cosun's profit in 2020
In a challenging corona year, food group Cosun has seen its profit for 2020 increase by just under 67% to €30 million. Even chips producer Aviko, which is suffering greatly from the drop in demand due to the various lockdowns, ultimately managed to stay out of the red. Sugar company Cosun Beet Company was able to make a solid profit, partly due to a rising sugar market.
This said CEO Albert Markusse on Thursday morning (11 February) at the presentation of the annual figures of the cooperative company. Cosun saw the group's turnover drop slightly by 0,8% to €2,029 billion. The increase in profit is largely supported by the one-off gains from the sale of the former factory site of Cosun Beet Company (formerly Suiker Unie) in Puttershoek. When asked, Markusse declined to say what amount Cosun had touched up for this.
Cosun presented a beet price yesterday which was slightly higher than that of the 2019 campaign. If it had not been for the corona crisis, this price would have been 'substantially higher', Markusse acknowledged when asked at the digital press meeting. "Then Aviko would have achieved a much better result."
Markets fell away
The fact that Aviko was able to close last year with a positive result is striking due to the impact of the corona crisis. Due to the lockdowns in the spring and autumn of 2020, Aviko saw a large part of the chips sales to the food service and out-of-home (catering) disappear. "In the spring of 2020, the markets suddenly fell away due to the first strict lockdown. That caused great concern," Markusse looked back. This also led to a free fall in the quotations on the potato market, for which the affected growers were partly compensated by the government.
Markusse emphasized that he was happy that Aviko 'fulfilled all contracts with the growers during this period'. In the summer, chips sales at Aviko were almost back to normal, until the second lockdown arose in the autumn. "But this has less of an impact on French fries sales than the first. Thanks to creative entrepreneurs in the catering industry, who have started with home delivery and collection. With Aviko, we also have a good market position with our coated fries, because these fries are warm for longer. and therefore better suited for home delivery."
Flakes and snacks run well
Aviko has also managed to improve its position in retail (supermarkets) over the past year, Markusse said. According to him, the lockdowns do affect Aviko's overall result. While the chips segment is experiencing pain, other Aviko divisions performed very well last year. For example, the market for granulate, flakes and snacks, where Aviko is active with Rixona, among others, is growing very fast. According to Markusse, the flake company in China also performed excellently. "It is full in terms of production."
In addition, Aviko has also sailed close to the wind in terms of investments and strongly focused on cost savings, Markusse indicated. In Germany, Aviko has bought a flake company in Germany from Unilever, a French fries company has been acquired in China, 2 large cold stores have been built and construction has started on a new French fries factory in Poperinge in Belgium.
European sugar industry under pressure
Cosun Beet Company has gone from a slight loss in 2019 to a 'satisfactory positive result' in 2020, the CEO of Cosun outlined. The sugar company also had to anticipate the corona crisis, because customers such as soft drink manufacturers also saw sales disappear in the food service. However, prices in the global sugar market have been rising for some time and the underlying trend of annual sugar consumption growth of 1 to 1,5% remains positive.
The performance of the Dutch sugar company in Europe is also very strong, Markusse emphasized. "Our cost price is good. And the cost price makes or breaks a company." He pointed out that moderate to poor beet prices are paid for other European countries. "In countries where beet prices are around €25, growers stop. Factories are closed in France and Germany. The European sugar industry is under pressure."
Bioethanol a cash generator
A striking cash generator, as Cosun calls it, was the sale of bioethanol for disinfecting gel last year. In the current corona crisis, the food group was able to tap into a new market through its German factory in Anklam. "That has helped a lot and made a nice profit", says Markusse. Cosun is counting on Cosun Beet Company to continue its positive trend this year, given the likely declining sugar volumes in the EU and rising sugar prices. The company is also investing heavily in plant-based alternatives to sugar, in anticipation of trends in the food market.
Cosun also saw the other divisions Sensus, Duynie and SVZ make a positive contribution to the result. For cooperative chairman Dirk de Lugt this is proof that the strategy of Cosun, a portfolio of various companies for spreading risks and sharing knowledge, works. "Even in a crisis year in which Aviko had a difficult time, for example, we can still pay a decent beet price. However, we are working hard to structurally raise the return for our members to a higher level."
Eric the Thrush
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