Stockholm / SE. (lg) Lantmännen´s results for the first half of 2012 are lower than the previous year: 222 Million SEK, compared to 506 Million SEK during the same period in 2011. The main explanations for the weaker results are the persisting and very unfavourable ethanol-grain price relation, and weaker demand in several food categories. The Agriculture and Machinery Sectors show slightly weaker results than the previous year, but Lantmännen Lantbruk´s contribution-related operations continue to develop in a positive way.
«The trend from the beginning of the year persists. The weak global financial situation dampens the economic development, and growth projections for our main markets are still low – which can be seen also in our results, which are not satisfactory. In addition to our ongoing structural adjustments and savings programs, we have also launched a number of other measures to reverse the trend», says Per Olof Nyman, Group President and CEO of Lantmännen.
The Agriculture Sector´s profit in the first six months amounted to nine Million SEK (compared to 20 Million SEK the previous year). The lower results were mainly due to a weaker performance in the international operations. The Swedish contribution-related business continues to perform well, and showed an improvement in its results: nine Million SEK (two Million SEK). The improvements are primarily the results of Lantmännen Lantbruk´s action program.
The Machinery Sector´s profit for the first six months amounted to 91 Million SEK (179 Million SEK). The decline is partly due to less activity on the machinery market compared to last year, but primarily due to delivery problems for some of Lantmännen Maskin´s and Swecon´s sub contractors and component suppliers. This has led to a challenging delivery and sales situation.
Within the Energy Sector, the unfavourable price relation between ethanol and grain remains a major challenge. The sector´s results for the first half amounted to minus 101 Million SEK (five Million SEK), and Lantmännen Agroetanol continues to report heavy losses.
«The decrease of imports of subsidized ethanol from the U.S. has recently contributed to the ethanol price rising, but the price relation is still unfavourable. We are working to reduce the costs that are within our control, and to increase other revenue streams from production», says Per Olof Nyman.
The results for the Food Sector in the first six months amounted to 207 Million SEK (304 Million SEK). Competition from private labels remains tough, and the demand for low-price products remains high. Most of Lantmännen´s food categories have a negative growth.
«We have taken strong measures to improve profitability, specifically in the form of several new projects that will increase efficiency in the supply chain, and by increasing the pace of our structure rationalizations. We are also reviewing and implementing changes to our organizational structure in parts of the business, in order to have the most-cost effective organization possible», concludes Nyman.
