Horizon to dispose of farms

USA/UK – Organic foods company Horizon Organic has announced that it is to dispose of its farming assets and concentrate on marketing organic products.

The news came as the company released its sales results for the first quarter, with sales up 12% on the same period last year to $42.2 million (46.1 million euro).

The company reported a net profit of 900,000 euro compared with a 140,000 euro loss for the same period last year. However, this figure does not allow for Horizon’s loss-making farms in Idaho and Colorado. Including these operations, net profit would have been just 340,000 million euro. The Colorado farm is due to close at the end of September, while Horizon said it was in talks to sell its Idaho facility.

In the USA, Horizon saw organic dairy sales rise 16% on the first quarter of 2001. In the UK, Horizon reported that sales were flat as it moved from supplying private-label milk to marketing the Rachel’s Organic dairy brand. Horizon predicted that the launch of Rachel’s Organic milk in the UK would help boost sales. The company also supplies UK processor Diary Crest.

The sale of the farms is part of Horizon’s plan to move away from farming. Commenting on the disposals, Horizon president Chuck Marcy said: “This will allow us to focus on continuing operations and should enable us to strengthen our sales growth, improve productivity and reduce cost throughout the balance of the year.” He added: “We are confident that our new product initiatives, strategic partnership agreements and new consumer marketing activities will deliver strong double digit sales growth for the foreseeable future.” Marcy remained up beat, saying that sales growth and margins pointed towards strong results for the rest of the year.