Hochdorf reports "year of transformation"26 Mar 2020
2019 was a year of transformation for the Hochdorf Group, it says, caused in particular by acquisitions in recent years that did not develop as hoped.
The extension of the syndicated loan and the sale of the Pharmalys companies were two of the most important measures implemented to stabilise the company.
Hochdorf generated a net sales revenue of CHF 456.8 million in 2019 (-18.6% compared to the previous year). Due to additional capital allowances, value adjustments and provisions, EBIT was CHF -265.3 million, with a loss attributable to shareholders of CHF -239.2 million. Due to the highly negative result, the Board of Directors is proposing to shareholders that no dividend be paid.
In 2019, Hochdorf processed 677,845 tonnes of milk, whey, cream and buttermilk (previous year (PY): 661,017 tonnes; +2.5%). A lower quantity of liquid was processed at the Swiss plants and a higher quantity at Uckermärker Milch GmbH. In terms of infant formula in particular, plant utilisation did not meet expectations.
Hochdorf generated net revenues of CHF 456.8 million, -18.6% below the prior-year figure of CHF 561.0 million. As a result of the lower sales and the value adjustments made, gross profit fell significantly year-on-year from CHF 171.8 million to CHF 61.8 million.
Operating costs increased slightly compared to the previous year. This was due to the higher costs of Pharmalys Laboratories SA, particularly in the area of distribution costs, which are included until deconsolidation at the end of November 2019. Amortisations on tangible and intangible assets amounted to CHF 51.6 million (PY CHF 14.4 million). This is mainly due to impairments on fixed assets of CHF 28.5 million on shareholdings. The loss on shareholdings amounts to CHF 139.1 million, which resulted from the sale of the Pharmalys shareholdings and Hochdorf South Africa Ltd. In addition, debt provisions were set up and additional amortisations were made on the assets of subsidiaries and inventories. Value adjustments and provisions were also undertaken for loans to subsidiaries. The additional capital allowances, value adjustments and provisions resulted in an EBIT of CHF -265.3 million and a loss attributable to shareholders of CHF -239.2 million.
In Switzerland, Hochdorf Swiss Nutrition processed 391,409 tonnes of milk and whey (PY 408,857 tonnes; -4.3%). The decline can be explained by the lower milk yield as a result of the dry summer of 2018, the lower milk production in the second half of the year due to the uncertain financial situation as well as the poorer milk prices in competition with industrial cheese making as a result of the follow-on solution from the "Schoggi Law". Despite the challenging procurement and liquidity circumstances, Hochdorf Swiss Nutrition Ltd always managed to maintain supply and so defend its market share. The integration of parts of the Cereals & Ingredients division and the divestment of unprofitable business activities were largely completed by the end of the year.
Uckermärker Milch processed a significantly higher liquid volume than in the previous year (286,436 tonnes compared to 234,324 tonnes; +22.2%). The milk quantity increased significantly as a result of new contracts with several regional direct suppliers. As part of the restructuring of the Hochdorf Group, the shareholding in Uckermärker Milch was sold at the end of February 2020.
The Baby Care division achieved a net sales revenue of CHF 72.8 million in 2019 (PY 176.0 million; -58.6%). The decrease can be mainly explained by a significant fall in sales to some large customers and sluggish sales for the former subsidiary Pharmalys Laboratories. A collapse in sales, necessary value adjustments on outstanding receivables and the technical challenges that arose in the second half of the year in connection with the launch of the spray tower line 9 at the Sulgen plant all put pressure on operating results.
In 2020, the new Board of Directors will work together with Group Management to develop a future strategy for the Hochdorf Group. A key focus for the future will be ensuring sustainable business development in the Baby Care division in a highly competitive international environment. Sales and service structures have to be strengthened and market oriented to achieve the required growth and improve utilisation of the plants in Sulgen. It is vital to secure sustained growth with Pharmalys in 2020 and promote the internationalisation of the "Bimbosan" brand. Business development plays a central role in the future development of the Baby Care division, as the acquisition of new customers involves lengthy and complex approval processes.
The wholesale market will remain highly competitive for Dairy Ingredients in 2020. H the situation in milk procurement and the sales market to remain very challenging as a result of the solution that succeeded the "Schoggi Law". The customer and product portfolio established in recent years will be further developed. The best possible plant utilisation to secure the Hochdorf Group's economic success is particularly important in this regard.
The market situation remains very challenging; with the impact of the coronavirus epidemic difficult to assess at the current time, the Board of Directors and Group Management have agreed a sales and revenue range for the 2020 business year. The Hochdorf Group is expecting net sales revenue in the region of CHF 280 – 320 million and positive results at the EBITDA level.
Icelandic Provisions dips into oat milk with new skyr product
11 Jun 2021
American dairy company Icelandic Provisions launched its first plant-based product, Oatmilk Skyr. When the product rolls out across the U.S. at Whole Foods Market locations, the company says that it will become the first oat milk skyr on the market.Read more
Cow-free ice cream maker Eclipse Foods launches summer flavors
31 May 2021
Bay Area-based Eclipse Foods is looking to become the household name that is a an eponym for plant-based dairy products. As part of that mission, the company will release seven new flavors in June, The Spoon reported.Read more
European Parliament allows ‘buttery’ adjectives on dairy-free products
28 May 2021
In a u-turn from its policy last fall, the European Parliament dropped Amendment 171 and will allow manufacturers to use descriptive terms like “buttery” and “creamy” to describe plant-based products.Read more
Spanish dairy company launches incubator to cultivate cultured milk
25 May 2021
Calidad Pascual launched Mylkcubator through its innovation and investment arm, Pascual Innoventures. Mylkcubator is the world’s first global incubation program for cellular agriculture technologies in the dairy industry aimed at producing dairy altern...Read more
Fermentation cultures bubble to the top of plant-based dairy
14 May 2021
Recently, the Good Food Institute dubbed fermentation as the third pillar of the alternative protein industry, alongside plant-based and culture-based alternatives, and its prediction has proved prophetic. As the plant-based space continues to burgeon ...Read more
German fermented dairy startup rebrands, announces first product
6 May 2021
Berlin-based precision fermentation company LegenDairy is rebranding itself as Formo, the Latin word for ‘I mold, I form,’ according to a press release from the company. The rebranding coincides with the announcement that the company plans to launch it...Read more
Startup Bevry takes first mover advantage in Indian oat milk category
5 May 2021
Indian startup Bevry has developed its own oat milk formulation, which it is manufacturing and selling exclusively in India with the goal of becoming the “Oatly of India.” According to the company, it is the first brand to manufacture and sell an oat-b...Read more
Unilever and Nestlé petition to phase out caged hens in Europe
29 Mar 2021
In a letter to the European Commission, major food titans called on the government to end the practice of raising hens in cages in the European agricultural sector. To accomplish this push, industry heavyweights Unilever and Nestlé partnered with the o...Read more
Danone acquires the LA-based vegan dairy maker Follow Your Heart
4 Mar 2021
French dairy conglomerate Danone acquired the Los Angeles-based vegan dairy maker, Follow Your Heart. The acquisition was done with a 100% purchase of Earth Island shares, the brand’s parent company. However, financial details were not disclosed.Read more
Chobani moves out of yogurt into RTD coffee
25 Jan 2021
As the New York-based Greek yogurt company continues to expand, its latest move is into the ready-to-drink coffee space with its new Chobani Coffee options, crafted with single-origin cold brew and feature Chobani's oat milks and dairy creamers.Read more
Are you a supplier?
Here's what we can do for you
- Generate quality leads for your business
- Stay visible for 365 days of the year
- Receive product inquiries and respond to meeting requests directly
- Improve company online presence through Search Engine Optimisation