Gross profit in 2018 was €113.1m ($133.3m).
The group committed capital investments of €18.8m ($22.2m) that will form the foundation for the group’s long-term plans.
Normunds Staņēvičs, CEO of Food Union, Europe, said, “We actively invested in long-term growth for our leading market brands to meet growing demand. We focused on enhancing production capabilities and poured energy into modern technologies to improve production capacity and ensure the highest quality product. This will give us an ongoing competitive edge as we continue to push the boundaries of innovation and create new products that delight consumers.
“In 2019, unpredictable and unfavorable weather conditions impacted sales, however, the year was also marked by record investments in our production facilities, equipment, machinery and fixtures, as well as a car fleet. This year’s total CAPEX of €18.8m is the highest investment in the last five years and double the average investment of the past two years. I am infinitely grateful to our Food Union family of over 3,100 people, and I hope the results of 2019 will inspire new achievements and success stories in 2020.”
The Group’s 2019 net revenue relied on two key products: ice cream products at nearly 60% of the total revenues and dairy at almost 30%. Other products, such as frozen food and pastry, formed about 10% of the total revenue.
Even though ice cream sales were impacted by cold and wet conditions in the summer, additional food products such as, dairy, pastry, convenience and frozen foods achieved good results, the company said.
The Group also focused on modernizing trade across all its markets. It entered new retail chains, as well as achieved enhanced listings on national and regional levels, leading to €163m ($192m) in ice-cream generated net revenues in 2019, a 1.8% decrease from 2018.
The dairy segment was stable with close to €81.8m ($96.4m) net revenue. Frozen food dropped by 8.3% (€22m/$25.9m net revenue), while pastry grew by 11.3%, posting net revenue of more than €5.8m ($6.8m).
Since 2011, Food Union has grown to be the leading ice cream maker in the Baltics and Denmark; it also holds a market position in Norway, Romania, Russia and Belarus.
Shareholders include founder and global head, Andrey Beskhmelnitsky; the Hong Kong-based investment company, Meridian Capital Limited; and PAG, an Asian private capital firm. Meridian Capital Limited and PAG became Food Union shareholders in 2015 and 2018 respectively in order to finance construction of two dairy plants in China and facilitate the group’s expansion into the Chinese market.
Food Union Group is made up of the two largest dairy and ice cream companies in Latvia, Rīgas piena kombināts and Valmieras piens; Estonia’s and Lithuania’s largest ice cream makers, Premia TKH and Premia KPC, respectively; the leading Danish ice cream producer, Premier Is, and Danish doorstep-delivery ice cream company, Hjem Is; Norway’s ice cream production company, Isbjørn Is, and doorstep-delivery ice cream company, Den Norske Isbile; Romanian ice cream maker Alpin57Lu; Ingman Ice Cream in Belarus; and Khladokombinat No.1 in Russia.
In 2018, Food Union expanded into China by opening two greenfield dairy and children’s product plants in China.
