HKScan net sales plummet in annual report

14-Mar-2019 - Last updated on 14-Mar-2019 at 11:14 GMT

Net sales and operating profits were impacted across the group for 2018

Finnish meat processor HKScan has revealed a “weak” year for net sales and operating profits across the group in its 2018 report.

The group highlighted that net sales fell to their lowest point over the last four years, to €1.72bn compared to €2bn in 2014, while operating profits also decreased by 3.4% year-on-year.

HKScan said the main reasons for the drop in net sales was attributed to the weakening of the Swedish krona, lower sales of red meat in Sweden and Finland, as well as the challenges at its poultry unit in Rauma.

In its other divisions, Denmark’s net sales increased slightly from the previous year as a result of higher export volumes. It also recorded a small increase in net sales in the Baltics.

Operating profit was down in all of its other market areas, with the exception of Sweden. The decrease was attributed to the ramp-up costs of the Rauma poultry unit, with the increase in production costs related to the commissioning, material loss and lost sales.

HKScan said in the report: “Stabilising the Rauma unit’s production operations and achieving the targeted efficiency, as well as commercially strengthening the poultry operations are at the core of our efforts. We will also strengthen the sector expertise needed for this work.”

Other areas of the business in the report included an update to its farm to fork strategy, which the group said provided a “relevant framework” for its operations.

It added that the update emphasised its position as a responsible and sustainability-focused business.

HKScan recently opened Sweden’s largest pig slaughterhouse in Kristianstad as part of its plans towards certifying the plant for exports to China.