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Acquisitions assist Atria’s profit rise

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Oscar Rousseau

By Oscar Rousseau+

Last updated on 20-Jul-2017 at 13:23 GMT2017-07-20T13:23:53Z

Atria's sizable investment in production efficiency is starting to lift profit
Atria's sizable investment in production efficiency is starting to lift profit

Two takeovers in the past 18 months have helped Finnish meat processor Atria post what its CEO called “delightful” profit and sales growth. 

Atria posted €9.1m in pre-tax profit, up from €4.5m a year earlier, in its half-year trading results for 1 January to 30 June 2017.

These solid results for the business, which recently signed a lucrative Chinese export deal , came as Atria followed a four-year ‘Healthy Growth’ strategy: a roadmap combining selective acquisitions, new market access and product innovation to alleviate the impact of European price pressure.

This saw the business complete two takeovers in 2016: beef processor Kaivon Liha for €40m and Sweden’s third-largest chicken producer Lagerberg for €18m . And Atria’s financial results suggest the implementation of the strategy has had the desired effect, so far.

Atria half-year sales performance – at a glance
  • Finland: €480.8m
  • Scandinavia: €174.3m
  • Russia: €41.6m
  • Baltics: €18.6m

‘Especially delightful’

Atria’s net sales have increased during the first half of the year, and profits have improved compared to last year,” said CEO Juha Gröhn.

The growth is based on both organic growth and on acquired operations. The strategy of healthy growth is being implemented, and it is especially delightful that net sales have grown in all business areas.

Atria’s second-quarter profits were up in Finland, the Baltics and Russia, thanks to an upturn in the meat market, but also due to the company’s investment in modernising production lines.

Finland’s biggest solar power park

In Estonia, for example, meat production has been centralised at a single plant.

Meanwhile, a €36m investment at the Nurmo pig cutting plant – the only factory licensed to export pork to China – is nearing completion, after 80 axed jobs. The cash pumped into the factory “significantly improved” throughput in the spring, Gröhn added.

Production at Nurmo is set to rise further after the first shipments of meat arrived in China in June. With Chinese import demand still ravenous, Atria expects to surpass the 3,000 tonnes of frozen pork it had previously expected to send to China this year.

Atria has also begun work on what it has claimed will be “the largest solar power park in Finland” at its Nurmo facility. Part-financed by the Finnish government, the solar panel fields will be operational in 2018.

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