Cloetta Fazer reports increased sales but lower operating profit

Cloetta Fazer’s sales for the third quarter rose by 8 per cent to SEK 745 million (692). Operating profit excluding restructuring charges for the third quarter is reported at SEK 67 million (89). Operating margin was 9 per cent (12.9).

“Cloetta Fazer increased its confectionery sales in the third quarter, partly due to the successful launch of new products. The relatively cool summer in the Nordic region also contributed to the period’s sales growth,” says Cloetta Fazer’s CEO Jesper Åberg.

“Despite robust sales, however, Cloetta Fazer recorded a lower profit owing mainly to increased costs for raw materials, manufacturing and sales/marketing activities,” he adds. “To compensate for the higher raw material costs it will be necessary to raise our market prices, as announced in the first quarter report. Aside from that, we are further optimising our production efficiency through both production investments and the already announced staff reductions.”

Cloetta Fazer’s share of the total Nordic confectionery market is 22 per cent. The company has its strongest position in Finland, with a market share of 40 per cent, followed by 24 per cent in Sweden.

“The acquisition of AB Karamellpojkarna, which we informed about on 1 October, is being undertaken as part of our growth strategy. The company is the third largest supplier of throat lozenges in Sweden and the acquisition will boost our total sales by approximately 2 per cent,” concludes Jesper Åberg.

Net sales for the nine-month period grew by 3 per cent, or SEK 63 million, to SEK 2,143 million (2,080). Operating profit was SEK 158 million (211). Operating profit excluding these charges was SEK 179 million (217). This is equal to an operating margin of 8.4 per cent, compared to 10.4 per cent the year before. Net profit amounted to SEK 129 million (158).