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Hungarian meat firm to invest in packaging, processing

Post a commentBy Jaroslaw Adamowski , 27-Jun-2017

Poultry processor Sága Foods aims to increase exports of chicken products
Poultry processor Sága Foods aims to increase exports of chicken products

Hungarian poultry processor Sága Foods Zrt to spend about HUF 600 million (€2 million) this year to expand and modernise the meat processing and packaging capacities of its facilities, according to senior company representatives. 

Zsolt Keleti, Sága Foods CEO, told local news agency MTI that the investment is part of the company’s expansion strategy, aimed at increasing revenues and export sales. He also outlined plans to add new products to the company’s portfolio.

In the years 2015 to 2017, Sága Foods will invest a total of HUF 1bn (€3.2m) with the aim upgrading and raise its processing and production capacities.

Investments to expand sales

According to Keleti, Sága plans to achieve annual revenues of more than HUF 10bn (€32.3m) by 2020. This would represent a considerable increase on current sales. Over the past three years, Sága Foods has posted annual sales in the range of HUF 8bn (€25.9m) to HUF 9bn (€29.1m). In 2016, the firm reported an EBITDA of some HUF 503m (€1.6m). This represented an increase of 21.5% compared with about HUF 414m (€1.3m) a year earlier.

Keleti said that, should the Hungarian company’s owner focus on expanding Sága Foods’ sales to new foreign markets, the meat processor could even double its annual revenues in the long-term.

Sága Foods became a subsidiary of the UK’s Bernard Matthews in 1993. Last September, Boparan Holdings took over the troubled turkey specialist from private equity firm Rutland Partners.

Domestic, foreign suppliers

Sága Foods sells about 10,000 tonnes of various products per year. For its meat processing activities, the business purchases raw material predominantly from Hungary-based companies, such as the Kecskemét-based Gallfood Zrt, but also from foreign suppliers, including those located in the Netherlands.

The company’s product portfolio consists of a wide range of processed poultry meat products, including hams, frankfurters, pâtés, sausages, wings, meat balls, and others. The meat processor says some of its flagship products include Hungary’s traditional Füstli smoked frankfurter and Selyemsonka ham.

In addition to the Hungarian market , which is responsible for about 55% of the meat processor’s sales, Sága Foods also exports to various foreign markets, mostly located in Western Europe. Some of the company’s main export markets include the UK, Germany, Italy, Austria, Poland, Romania and Slovakia. The firm sells its products through large retail chains, international wholesalers and food service customers.

Sága Foods is a leading Hungarian poultry processing company with its headquarters in Sárvár, about 220km the west of the country’s capital Budapest. In the Hungarian market, the company claims to have a brand awareness of 95%. Sága’s meat processing facilities are operated by a workforce of 248 employees, and they are HACCP-, BRC-, IFS, ISO- and Q&S audit-certified, according to data released by the firm.

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