US impacts Chr. Hansen first quarter

Related tags Europe North america

Flat sales at Chr. Hansen's food ingredients unit in the first
quarter, as a slight rise in sales in Europe, South America and
Asia/Pacific failed to account for the 6 per cent drop in North
America.

Danish supplier of probiotics Chr. Hansen this week said its food ingredients division was impacted by a slump in sales in North America. Net sales in Europe, South America and Asia/Pacific however were up 5 per cent in the first quarter ending 30 November 2002.

The 6 per cent drop in North America sales, which meant an overall organic growth rate of 0 per cent, was partly caused by rationalisation of its product range in this region and also a gap between the end on 1 September of a partnership with Dutch company DMV concerning specialtyproducts for the pharmaceutical industry and a new agreement with US company Foremost Farms which did not begin until 1 December 2002.

The group added that lack of organic growth reflected a temporary stagnation in the ingredients market resulting from inventoryadjustments and the negative trend of the global economy.

As exchange rates fell 9 per cent in the period, total sales fell to DKK867million (€116.6m) from DKK948 million in the prior year. Sales in the European region were DKK399 million in 2001/02 and DKK400 million in 2002/03. On a positive note, the company reported that sales of cultures for the food industry, the agricultural industry and the health food industry continued to show satisfactory growth.

In natural colours, several raw materials showed falling prices, which spilled on to the prices of finished products, resulting in a slight fall in sales.

Sales to the Russian and Eastern European markets continued to perform well, particularlydriven by sales to the dairy industry and themeat-processing industry, said Chr.Hansen.

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