Emmi reports slight profit

Swiss dairy group Emmi reached CHF 1.594 billion (€1.4bn) in sales, an increase of 2.0% (-0.7% organic) in the first half of 2016, compared to the same period last year. Net profit was CHF 61 million (€55.9m, previous year CHF 46 million).

Emmi anticipates that economic conditions will not change significantly in the second half of 2016. This highly competitive, volatile environment and the low milk price will prevail in the second half of the year, it says.

New significant macroeconomic uncertainties have recently been added, the company says. For example, the impact of the referendum in the United Kingdom on the membership of the European Union cannot yet be fully assessed.

Sales development in 2016 for Emmi remains marked by the challenging situation on the domestic market, where competition, pressure from imports and shopping tourism continue. Nevertheless, Emmi is confident that it can reach previous targets in Switzerland and Europe.

In the Americas Division (covering the markets in the US, Canada, Chile, Spain, France and Tunisia) the targeted organic growth of 5% to 7% this year is probably too ambitious, Emmi notes. Reasons for this are the milk prices in the US as well as the difficult economic conditions in Chile and Spain.

At group level, Emmi expects sales growth of -1% to 1% (previously 0% – 1%). Income is adjusted slightly upwards. Expectations of the earnings before interest and tax (EBIT) was first set between CHF180 million and CHF190 million, but is now raised to somewhere between CHF185 million and CHF195 million.

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