Naturex earnings plunge

6 Apr 2015

Naturex has reported its annual earnings down “sharply”, a result, the company said, of difficult market conditions in the first nine months, and higher committed fixed costs. Profitability was lowered by significant exceptional write-downs of inventories and industrial assets. The Chairman of the Board of Directors and Chief Financial Officer have left the company, with […]

Naturex earnings plunge

http://www.dreamstime.com/stock-photos-euros-dollars-image3737423Naturex has reported its annual earnings down “sharply”, a result, the company said, of difficult market conditions in the first nine months, and higher committed fixed costs. Profitability was lowered by significant exceptional write-downs of inventories and industrial assets.

The Chairman of the Board of Directors and Chief Financial Officer have left the company, with Paul Lippens appointed as chairman and Hélène Martel-Massignac as vice-chairman of the board of directors. Olivier Rigaud, who has been CEO since fall 2014, was appointed a director.

Naturex said that it had implemented “robust measures” to improve operational and financial discipline.

The group had annual sales of €327.4 million, up 2% (2.2% at constant exchange rates). This included a sharp improvement in the fourth quarter in response to a more favourable foreign exchange environment (primarily the US dollar’s rise versus the euro) and a very good contribution from Vegetable Juices.

Recurring EBITDA amounted to €36.8 million, a sharp decline of 30.6%, whereas revenue grew 2%. Current operating income came to €14.8 million, representing a margin of 4.5%, compared to €35.3 million in 2013.

There were significant effects from €7.1m of non-current operating expenses including impairment charges on assets in California, Poland and Spain that reduced operating income to €7.7 million.

In addition, Olivier Rigaud, also announced the departure of Thierry-Bertrand Lambert who has served as Chief Financial Officer since January 2013.

Since arriving in October 2014 to head up the group’s executive management, Olivier Rigaud has sought to meet with Naturex’s driving forces, visit all manufacturing sites and exchange views with Group customers to better understand the specific characteristics of Naturex business lines and acquire an understanding of the key challenges of its markets.

After this initial phase of observation, an action plan (“Conquest, Cash & People”) setting priorities for producing the necessary drivers for lasting and profitable growth was implemented and presented in January 2015.

“2014 was particularly difficult due to a combination of factors that adversely affected our markets and businesses. The necessary strategic decisions that we took moreover had significant adverse non-recurring effects on our profitability,” said Rigaud, “and in a macroeconomic environment that still appears unstable, starting in January 2015 we implemented targeted action plans combined with a rigorous and disciplined approach across operations, while maintaining our momentum and agility for conquering new growth markets that is essential for generating sustainable and profitable growth. Finally, we will finalise and apply our 2020 strategic plan to create value and position Naturex as a major industry player of tomorrow.”