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HKScan to invest in the growing poultry market - Capacity of the Rauma poultry unit will increase and productivity will improve

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HKScan Corporation, Media Release, 22 January 2020, 8:30 (EET)

HKScan will invest some EUR 6 million in the new slaughter process of its poultry unit in Rauma. The investment will significantly improve raw material yield, productivity and operational reliability and ensure the capacity required for strongly growing demand. The investment will be implemented in stages at the end of 2020.

HKScan’s CEO Tero Hemmilä: “We will renew the whole first part of the poultry unit’s production process in Rauma since the slaughter line introduced in 2017 does not meet the standards required by the Group’s current management. With the investment, the processing capacity of the slaughter line will increase by some 20 per cent and raw material yield by some 10 per cent. The investment will also ensure a significant reduction in the consumption of utilities, such as water and district heating. Demand for poultry products continues to increase and the investment enables us to better meet this strong demand in the coming years.”

With the investment, the current slaughter line will be dismantled. For this reason, HKScan will record a EUR 6.9 million write-down of the residual value of the current line balance sheet. The write-down has no impact on cash flow.

To ensure the stabilised service level during 2019, the new slaughter line will be installed in stages at the end of 2020. The investment will improve operational reliability and productivity of the Rauma unit and significantly increase production capacity from the current levels. Demand and sales of HKScan’s poultry products in Finland have grown faster and stronger than expected. This investment will enable business growth more assuredly in the years to come. Demand and sales of Kariniemen® poultry products, in particular, are expected to grow faster than the market.

HKScan’s strong profit improvement in its poultry business in Finland has been one of the key drivers of the Group’s profit improvement in 2019. In the second half of 2019, HKScan returned to its market leader position in poultry category in Finland due to significantly improved service level.

HKScan Corporation                                                                                                                                      

Tero Hemmilä
CEO

Further information:
Jari Leija, EVP, Business Unit Finland
HKScan Media Service Desk tel. +358 10 570 5700 or email communications@hkscan.com

HKScan Corporation is a publicly listed meat and food company with over one hundred years of experience in responsible Nordic food production for customer and consumer needs. HKScan’s sustainable way of operating spans the entire value chain, from farm to consumer. Our nearly 7,200 professionals ensure our promise of high-quality products that taste good. Our home markets cover Finland, Sweden, Denmark and the Baltics. Our diverse product selection includes poultry, pork, beef, and lamb products as well as charcuterie and meals. The company’s strong consumers brands are HK®, Kariniemen®, Via®, Scan®, Pärsons®, Rakvere®, Tallegg® and Rose®. In 2018, HKScan’s net sales were EUR 1.7 billion.

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