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FrieslandCampina feels the consequences of the war in Iran
FrieslandCampina achieved good results in Pakistan and Nigeria in the first quarter, with higher revenue and profit. However, the war in the Middle East is causing uncertainty in the region, which could affect sales.
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FrieslandCampina Engro Pakistan Limited saw profit rise by 70% in the first quarter to 1,851 billion Pakistani rupees, equivalent to €5,6 million. Revenue also increased, by 10% to 28,7 billion rupees. Cost savings contributed to the profit growth, as did weakening inflation.
A higher tax on UHT milk is, however, leading to declining volumes in this segment. The company also warns of headwinds in the coming quarters. The war in the Middle East, which began in late March, is bringing significant uncertainty. Higher oil prices are causing high production costs and putting pressure on the affordability of dairy, which could potentially lead to a drop in demand.
Wamco
FrieslandCampina Wamco, of which approximately 68% is owned by the cooperative, also performed strongly in Nigeria. Revenue rose by 14% to 182 billion Nigerian naira. Converted, this amounts to €112 million on a quarterly basis. The bottom line resulted in a profit of €7,6 million.
Compared to the same period last year, profit increased fourfold. The increase is attributed to better sales figures, tighter inventory management, and sharply decreased financing costs.