Bell Food Group with progress in the 2019 financial year
The Bell Food Group made significant progress in the course of the 2019 financial year. Adjusted for various special effects, the Bell Food Group achieved operational growth. Joos Sutter and Thomas Hinderer are nominated as new members of the Bell Food Group Board of Directors.
The Bell Food Group posted sales of CHF 2019 billion (CHF -4,1 million, -65,0%) in 1,6. Taking into account the acquisitions and divestments, operating growth of CHF 61,4 million (+1,5%) resulted. Thanks to the focus on more value-added products, the gross margin could be increased. The reported EBIT was CHF 95,3 million (CHF -45,3 million, -32,2%). Taking into account all special items of CHF 53,9 million, EBIT for 2019 was CHF 149,1 million (CHF +8,5 million, +6,0%).
All business areas contributed to the improved operating earnings situation. These advances were achieved thanks to increased sales of products with higher added value, effective cost management, process optimization and the partial passing on of higher procurement costs. In addition, synergies could also be achieved between the business areas.
As in the previous year, the financial result was negatively impacted by mostly accounting foreign currency influences amounting to CHF -9,6 million (previous year CHF -4,6 million). The reported annual profit is CHF 49,6 million (CHF -39,7 million, -44,5%). Adjusted for all special factors, the annual profit of CHF 103,5 million (CHF +14,2 million) is 15,9 percent above the previous year.
Overall, the Bell Food Group has a very solid balance sheet structure. Equity amounts to CHF 1,3 billion and the equity ratio is 47,5 percent, the same as last year. Financial liabilities decreased from CHF 903,6 million in the previous year to CHF 877,5 million.
Despite the significantly lower reported corporate profit for 2019, the Board of Directors will propose to the General Meeting of Shareholders a constant distribution of CHF 5,50 per share. In doing so, the Board of Directors takes the various special factors into account. The distribution is to be made in equal parts as an ordinary dividend and as a distribution from the reserves from capital contributions.
Special items for the 2019 financial year
The reorganization of the Bell Germany division, raw material prices and start-up costs for the new operations burdened the 2019 financial statements with special items totaling CHF 53,9 million.
At the end of July 2019, the Bell Food Group sold the German plants in Suhl and Börger in the form of a transfer of operations. This completed the exit from the German sausage business announced in June 2019. At the same time, the Bad Wünnenberg (DE) location was converted into a production facility for fresh convenience products for Hilcona. The reorganization burdened the Bell Germany division with costs of CHF 38,9 million.
Raw material prices for pork in Europe rose by more than 2019 percent in 43. The trigger for this was the outbreak of African swine fever in Asia and the associated high demand for European pork in Asia. Due to the intense competition in the European charcuterie and sausage market, price increases could only be delayed and only partially implemented despite negotiations that were initiated immediately. This resulted in additional costs of around CHF 9 million in the Bell International division.
Start-up costs for the new production facilities opened in 2019 led to additional costs totaling CHF 6,0 million. Most of this is due to the commissioning of the new convenience plant in Marchtrenk, Austria, in spring 2019.
Development in the segments
In a slightly declining market for meat and sausage products, the Bell Switzerland division recorded an upward trend in earnings despite lower sales and was able to make operational progress, particularly in the second half of the year. The focus of the assortment mix on more value-added products and effective cost management were responsible for this. The process optimization measures introduced in the previous year also had an impact.
The reorganization of Bell Germany and the sharp rise in raw material prices for pork in Europe had a major impact on business in the Bell International division. Adjusted for these one-off effects, the division recorded gratifying sales growth in 2019. With the reorganization in Germany and the start-up of the Serrano production facility in Fuensalida (ES), the Bell Germany division is concentrating on its strong position in the raw ham segment. The new production facility for Serrano ham with a capacity of around 1 million hams per year opened in summer 2019. In the future, the Bell Germany division will focus on its strong position in German and international raw ham. In the Western / Eastern Europe division, the positive trend in the national companies in France, Poland and Hungary continued. In the poultry division, the measures to increase efficiency and the investments in infrastructure are having the desired effect.
In 2019, ultra-fresh and ready-to-eat products were in particular demand in the convenience market. Thanks to innovative product concepts, the Convenience division was able to benefit from this trend. The Eisberg, Hilcona and Hügli divisions, which are part of the division, recorded disproportionate growth rates, particularly in product ranges with high added value. The innovations include, for example, the plant-based "The Green Mountain Burger", which will soon be available in retail outlets in addition to the food service.
Outlook 2020
In the current financial year, the Bell Food Group intends to make further operational progress in all business areas. In Europe, raw material prices are expected to remain volatile. Therefore, the timely realization of higher procurement costs in the sales prices is still decisive for the earnings development. Thanks to the new production capacities for raw ham and fresh convenience, there are further growth opportunities in these attractive markets.
Change in the Board of Directors of Bell Food Group AG
The Board of Directors of Bell Food Group AG has nominated Thomas Hinderer and Joos Sutter as new members of the Board of Directors. You will be proposed to the Annual General Meeting on March 17, 2020 as a replacement for the incumbent Board Member and Vice President Irene Kaufmann and the Board of Directors Andreas Land. The previous members of the Board of Directors are stepping down from the Board of Directors at their own request. The Board of Directors intends to elect Joos Sutter as Vice Chairman of the Board of Directors if he is elected by the General Meeting. Thomas Hinderer (61) has been CEO of Eckes AG, Nieder-Olm, Germany, as well as CEO and Chairman of the Board of Management of the Eckes Granini Group, since 2005. He will leave these positions at his own request in July 2020 after fifteen years in order to take on new challenges. Before that, he worked in management positions at the Theo Müller Group in Germany (2001 to 2005) and Bestfoods Germany (1992 to 2001). In addition to training as an industrial clerk, Thomas Hinderer also completed a degree in business administration. He has extensive and valuable experience in international food production as well as in international trade. Joos Sutter (55) has been Chairman of the Coop Cooperative, Basel, since 2011, and is responsible for the core business of the supermarkets as Head of the Retail Directorate. Since 1996 he has worked in various management positions for the Coop Group, including as Head of Trading at the Coop Cooperative (2009 to 2011) and at Interdiscount (1999 to 2009). Joos Sutter studied economics at the University of St. Gallen and has been a federal graduate since 1994. dipl. Auditors. He has great expertise in the areas of purchasing logistics, IT and sales. With both candidates, the Bell Food Group is gaining very committed and experienced personalities.
