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Dr. Oetker Sees Sales Up Across All Regions In Full Year 2019

Bakery firm Dr. Oetker has posted a 12.3% increase in reported sales in its financial year 2019, to €3.39 billion, with its performance boosted by a number of acquisitions.

If adjusted for acquisitions and exchange rates, growth for the year was 4.5%, the pizza maker said, with the business seeing an increase in sales across all regions – however growth in some markets was more pronounced than in others, it added.

Building The Business

Organic growth at the business was supplemented by a number of acquisitions in the period, Dr. Oetker said, commencing with the takeover of Confetti in Finland and Bagetid in Denmark at the start of the year.

Elsewhere, it also took charge of the Alsa brand in France, the Netherlands, Belgium and Portugal in March 2019, and in Morocco in October 2019, assuming leadership of the French baked goods and dessert market in the process, the company said.

In July of last year, it acquired Mavalério, a baking decoration business in Brazil.

Regional Performance

In its home market of Germany, sales growth was driven by the performance of is bakery, powdered desserts, pizza and cakes businesses, however its Müsli arm fell short of expectations, the company said.

In Western Europe, positive sales in Belgium, the Netherlands, Portugal and France helped boost the business – the latter benefiting from the takeover of Alsa.

In the UK, despite the ongoing Brexit negotiations, sales were up, while Denmark saw a sales slump due to what the company described as 'differing opinions regarding the marketing of products'.

Eastern Europe was boosted chiefly by an improved performance in Poland, both in the cake and dessert category and the pizza category, while Romania, Czech Republic and Hungary all posted organic growth.

Outside of Europe, the Americas region recorded a 'sharp leap' in sales, helped by the Wilton acquisition in the US, and the acquisition of Mavalério in Brazil; while the Asia, Africa and Australia region benefited from double-digit growth in India, South Africa and Korea.

Investment

Dr. Oetker invested €149 million in its operations last year, with large investments made in production lines and warehouse extensions in Germany, South Africa and Canada.

It also expanded its warehouse capabilities for pizza production in the UK and Canada, while in cakes and desserts, it neared completion of a new facility in Romania.

Looking Ahead

As to the coming year, Dr. Oetker said that it had expected growth for 2020 to be in line with the previous year, prior to the advent of the coronavirus, with its Oetker Professional business being the hardest hit in recent months.

At the same time, pizza sales and sales of bakery products saw a boost in March and April due to stockpiling.

"The completely uncertain course of the coronavirus pandemic makes it very difficult to give a valid forecast for the course of the business year 2020," said Dr. Oetker chairman Albert Christmann.

“The expected significant economic effects of the coronavirus crisis will also affect us as a food manufacturer. In all companies, we therefore took extensive measures at an early stage in order to compensate for lost sales as much as possible and to safeguard them through cost measures."

© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.

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