Swiss milk and cereal products company Hochdorf has announced that it processed a total of 255.9 million kg of milk, whey and permeate in the first six months of the year (+11.5% compared to the previous year). Gross sales revenue at CHF 220.7 million is also substantially higher than the previous year's value of CHF 182.5 million (+20.9%). Revenue figures also showed a significant increase: EBITDA was increased by +64.3% to CHF 13.8 million (previous year CHF 8.4 million) and the EBIT rose as much as +129.6% to CHF 10.2 million (previous year CHF 4.4 million). Operating net profit rose by +246.3% to CHF 6.3 million (previous year CHF 1.8 million).
Part of the reason for the positive revenue results was the significantly higher capacity usage compared to the previous year, the company said, while noting that net profits were affected by unusually high expenditure (CHF 1.82 million) resulting from damages in the Baby Care area in 2011.
Around 20% more milk was processed at the Hochdorf and Sulgen plants compared to the previous year (189 million kg). This is partly due to the general increase in milk quantities but also because of amounts made available by quantity restrictions on Emmental cheese production. To enable the company to process these milk quantities, it accepted and processed significantly less whey into powder in the milk-rich months (-31%).
The project to produce high-quality lactose and milk proteins is on schedule. HOCHDOR anticipates being able to produce these products in around one year for our own use in infant formula and for the international sales market.
Hochdorf Baltic Milk UAB processed 26.4 million kg, which was approximately the same amount as in the same period last year. However, the purchase and processing of additional milk concentrate enabled the company to achieve a 20% increase in the quantity of products sold.
In the first six months of 2014, Hochdorf Nutricare achieved turnover growth of 18.1%. The change from low-value to high-value projects is said to be on schedule due to high capacity usage. At the same time various measures led to an increase in productivity on the new line 8 of around 15%.
The audit undertaken by the Chinese authorities was very important for the company, Hochdorf said, and this has now been successfully completed. On May 7, the Hochdorf and Sulgen production sites were certified to produce infant formula for the Chinese market.
Hochdorf Nutrifood achieved slightly lower turnover than in the same period last year. The main reason for this fall was the lower turnover for bakery products. However, Hochdorf said that it has joined its various distribution partners in significantly increasing the number of customer projects in the areas of VIOGERM wheat germ products and dessert mixtures.
“We have succeeded in maintaining significant growth in the Baby Care area in the first half of the year,” the company said. “We anticipate that the plants used in infant formula production will operate at capacity this year or next year. For this reason, we intensified our search for additional milk plant in the first half of 2014. We are currently still at an exploratory stage with this in Western Europe and are focusing our attention on Germany.”
“In the second half of the year we again expect a slight growth in milk quantities. But we also anticipate a fall in the price of milk. This is not least due to the latest international price developments. However, because the price of Swiss A milk is falling too slowly, the price difference compared to the international milk price and the shortfall in "Schoggi law" funds are ever greater.
We expect to achieve the predicted growth of 10% across the entire Group, with between 18-22% for Baby Care. We are assuming that neither turnover nor profit will be as strong in the second half of the year as in the first. This is largely due to the seasonal nature of milk quantities, with the greatest amounts coming between April and June, as well as uncertainty over the extent of the shortfall in "Schoggi law" funding.”
