Pizza and baking ingredients giant Dr. Oetker has posted a mixed performance across its European operations in full-year 2019, with its Germany operations seeing sales 'increase significantly'.
The group said that product innovations and a streamlining of its product range contributed to the positive performance in its home market.
The business also posted 'significant' growth in the pizza category in the UK, Norway, Finland and Spain, however, this was offset by 'challenges' in several mature markets, including Italy, which saw a decline in sales.
In addition, in Eastern Europe, its performance was affected by currency devaluation, most notably in Turkey, which 'offset' the positive impact of product development and innovation, the company said.
Larger Business
Dr. Oetker's results incorporated the Conditorei Coppenrath & Wiese business for the first time last year, on the back of the former's acquisition of the business in 2015.
Together, the two businesses generated sales of €3.019 billion last year, and grew by 6.8% compared to the previous year (€2.827 billion), or by 5.2% if consolidation and exchange rate effects are included.
"The international framework conditions of the financial year 2018 were very challenging both politically and economically," commented Albert Christmann, Dr. Oetker chairman. "Nevertheless, against the background of the further development of our strategy, we have succeeded in achieving very pleasing overall growth."
International Performance
Outside of Europe, in the Americas the group was also impacted by currency devaluations in Mexico and Brazil, which offset the positive effect of its acquisition of baking and decorating specialist Wilton.
In Asia, Africa and Australia, the company made acquisitions in South Africa and Egypt which enabled 'very satisfactory sales growth', it added.
Investment
The group invested €149 million in its operations last year, €26 million of which was invested in its Germany business, with the construction of a new administrative building in Wittlich, which is due to be completed in June of this year.
Facilities were also commenced in South Africa, Poland and Russia, as well as a new warehouse in Romania. Elsewhere, in Germany, Brazil and Mexico, 'major investments' were made in production lines or process technology, the group said.
Some €53 million was also invested in production expansion at Conditorei Coppenrath & Wiese's Mettingen plant.
Since year end, the business has acquired French baked goods and dessert firm Alsa, with which it hopes to drive further growth this year.
Expansion Strategy
"Dr. Oetker and Conditorei Coppenrath & Wiese will continue its growth and expansion strategy in line with its strategy and, in addition, seize the opportunities offered by a changing world," Christmann added.
"We will continue to develop and bring to the market innovative products and services for consumers. The same applies to new, also digital business models, which we will test and, where appropriate, introduce nationally and internationally. In addition, we will gradually simplify and standardise our internal structures in order to counter the growing complexity of our business," he added.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
