China lifts Chr Hansen results

Related tags Chr hansen Marketing

Chr Hansen's full year results reveal that the continued growth of
the China market is helping the ingredients company to fight off
the problem of increasing costs.

The ingredients division of the Danish cultures and colours firm pulled in a DKK 369 million (€49m) profit for the year on sales of DKK 3.4 billion (€460m), a slight dip on the previous year on rising costs.

But a 20 per cent rise in fourth quarter profit shows strong growth, boosted by 'increased marketing efforts new products and new sales offices,' said the firm .

In Asia, China continues to dominate the sales figures with cultures and colours rising on the back of growing demand. The firm has opened application centres in Malaysia, China and India.

Capitalising on the expansion of the dairy market in China, the company now estimates that it has a 40 per cent share of the cultures market in the country. In the last quarter Chr Hansen, the leading natural colours player that it looking to increase its 23 per cent global share of the market, launched a new natural red colour range and a natural blue.

"Sales of natural colours and products in the human health industry also showed a favourable trend in Europe,"​ said the company in a statement this week.

The number one cultures supplier claims the past year has brought an increase in market share in Europe, 'on the introduction of new products for yoghurt and cheese industries resulted in growing sales.'

But costs for the ingredient sector bit into profit for North America on 'higher-than-expected production costs and changes in the product mix' with revenue dropping from DKK1.27bn to DKK1.2 bn.

South America showed growth in all product areas and revenue totaled DKK227 million, up from 220 million the year before. Flavours, in particular, developed at the firm's new industrial technology centre in Argentina 'were well received by the market.'

Research and development costs for the group, that includes ALK-Abello, the allergy sector arm, met 7 per cent of the revenue.

Looking ahead to 2004/05 Chr Hansen said it will aim for organic growth of 5 to 6 per cent, bringing the firm sales of DKK3.5 billion.

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