News FrieslandCampina
Difficult first half year for FrieslandCampina
FrieslandCampina has had a difficult first half year. The company was able to pay the members slightly more milk money than in the first half of last year, but an interim payment is not included. Also nothing could be reserved. The net result fell sharply, but was still positive.
FrieslandCampina suffered from sharply lower prices for basic dairy products on the European and global dairy markets, from consumers turning away from branded products in favor of cheaper private label dairy products and from expensive stocks that had to be written off.
The member dairy farmers have noticed relatively little of these problems thanks to the formula of the guaranteed price, which is determined more by what other dairies pay than by how their own company performs.
Negative reservation
The average guaranteed price over the first half of 2023 was €49,96 per 100 kilos, which is 57 cents more than the average guaranteed price over the first half of last year. However, the total (pro-forma) performance price fell from €52,63 to €50,58 per 100 kilos, due to the lack of an interim payment and a negative reservation.
The milk supply increased by 0,5% to 4,8 billion kilos. Total turnover rose from €6,6 billion in the first half of 2022 to €6,9 billion in the same period this year. The net result decreased from €139 million to €8 million.
The performance of the business groups was mixed. The largest, Food & Beverage, saw turnover increase, but the result fell sharply due to the above reasons. Specialized Nutrition performed well, mainly due to good sales of high-end infant nutrition in China. Ingredient also performed better. The Trading business group was hit hard by the sharp fall in basic dairy prices and saw the result turn from €71 million positive in the first half of last year to €138 million negative in the first half of 2023.
Klaas van der Horst
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