Spain's Ebro Foods said that its profit jumped 24% in 2021 thanks to asset sales, but it foresees harder times ahead as a result of droughts and rising energy prices.
The owner of brands such as Tilda rice and Garofalo pasta said its net profit rose to €238.6 million ($267.49 million) last year, when the group sold its pasta unit Panzani to focus on premium and fresh products.
Ebro Foods faced a year of extreme weather events and significant crop reductions, with cost increases of €83 million versus 2020, which translated into higher prices for its products.
Challenges In 2022
'We begin a 2022 that is expected to be even more difficult due to the evolution of inflation, the need to negotiate price transfers and droughts,' the group said in a statement to the Spanish market regulator.
'But we are confident that our strengths, the generation of synergies and our continuous cost optimisation efforts will allow us to face the year in a reasonable manner.'
Spanish consumer prices rose well above expectations in February to reach a three-decade-high of 7.4% year-on-year.
The company has reached a binding agreement to purchase the assets of InHarvest through its US subsidiary Riviana Foods for US$48.75 million (€43.4 million).
The deal includes two plants operated by InHarvest in Colusa and Woodland (California) – situated in the rice-growing areas of western United States.
InHarvest is active in the industrial (B2B), food service and private-label sectors for premium specialities in rice, quinoa and grains in the United States.
The transaction, which is not subject regulatory approvals, is expected to be close in early April 2022.