ForFarmers will pay closer attention to costs

The results of ForFarmers in the first quarter are again characterized by volume shrinkage. To monitor returns, ForFarmers has therefore recently started a reorganization. Concrete cost reduction figures are not mentioned.

Total feed sales fell by 5,2% in the first quarter, with compound feed sales falling by 6,4%. Feed sales are declining, especially in the pig sector. Exact tonnages and amounts are not mentioned. Ebitda did show a limited increase, due to better results in the Germany/Poland cluster. The United Kingdom, where sales to cattle farming show improvements, is also making a positive contribution to this. This means that the result has been showing some recovery for a long time, but it should be noted that the figures fell sharply last year.

Reorganization 
The recently appointed CEO Pieter Wolleswinkel says that the opportunities and threats are close together in this day and age. "Market position and return are important to us. That is why we recently started a reorganization so that the local approach can be implemented effectively and efficiently." The reorganization was briefly touched upon in the revised strategy announced at the end of last year. The focus is on innovation and cost reduction.

ForFarmers does not want to communicate externally how many jobs will be lost, but according to a spokesman, these are small numbers. ForFarmers has approximately 2.500 employees. Functions will also be shifted internally, given that the organization will be managed more decentrally. In concrete terms, this means that more responsibility will lie with the local management teams in the various countries.

Stock price
The ForFarmers share price has been stable in recent weeks at around €3 per share, but fell sharply this morning at the start of the trading day. In mid-April, the company announced that it would start a share buyback program. The purchased shares are used for the remuneration policy for management. Unlike in the past, bonuses are now paid in shares instead of cash. It concerns a maximum of 625.000 shares, for a maximum amount of €3.125.000.

Wouter Job

Wouter Baan is editor-in-chief of Boerenbusiness. He also focuses on dairy, pig and meat markets. He also follows (business) developments within agribusiness and interviews CEOs and policymakers.

w.baan@boerenbusiness. Nl

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