TOMRA: Initiating EUR 30 million cost reduction program in TOMRA Food division
In 2022, TOMRA launched a new set of financial ambitions for the coming five-year period. This includes an average annual growth rate of 15% and achieving an EBITA margin of 18% by 2027.
TOMRA Food's ambition is to contribute to the Group's targets with high single-digit growth at double-digit EBITA margin. Growth prospects for automated food grading and sorting remain attractive in the medium and long term. However, both growth and profitability have been below target in 2023 as customers have been faced with a combination of challenges including difficult macroeconomic conditions and lost or damaged harvests, especially within the Fresh Food segment.
TOMRA Food's strategic priority over the next year will be to increase profitability and customer satisfaction. To achieve this, TOMRA Food has today decided to initiate a cost reduction program of EUR 30 million (ca. NOK 350 million) in annual savings by taking advantage of unrealized synergies. The program is expected to incur one-off costs of around EUR 20 million. Full cost saving benefits are expected by the end of 2024.
"TOMRA Food is a leader in the growing market for automated food sorting and grading equipment. We are a strong and experienced global team with deep expertise within both fresh and processed food. The division is a result from four acquisitions over the past 12 years, and we still see room for closer integration and synergy realization between these. By refocusing the organization, we will be able to grow profitability while also increasing customer satisfaction," says Harald Henriksen who was appointed EVP of TOMRA Food in June this year.
Further details on TOMRA Food's improvement agenda will be presented in connection with TOMRA's third quarter result presentation on Friday, 20 October 2023. The presentation will be sent via live webcast. A recorded version of the webcast will be available shortly after the webcast has concluded.
Link to the webcast: https://channel.royalcast.com/landingpage/hegnarmedia/20231020_1/
Asker, 12 October 2023
TOMRA Systems ASA
Contact information:
Daniel Sundahl, Head of Investor Relations
Tel: +47 913 61 899
About TOMRA Food
TOMRA Food designs and manufactures sensor-based sorting machines and integrated post-harvest solutions transforming global food production to maximize food safety and minimize food loss, by making sure Every Resource CountsTM.
The company has more than 13,800 units installed at food growers, packers and processors around the world. These solutions include advanced grading, sorting, peeling and analytical technology to help businesses improve returns, gain operational efficiencies, and ensure a safe food supply.
TOMRA Food operates centers of excellence, regional offices and manufacturing locations within the United States, Europe, South America, Asia, Africa and Australasia.
For further information about TOMRA, visit www.tomra.com.
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This information is considered to be inside information pursuant to the EU Market Abuse Regulation (EU) No 596/2014 and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act.