Swiss food and beverage company Orior plans to sell some Albert Spiess assets to local animal protein processor Mérat.
Orior revealed the plan in a trading update today (5 March) for 2024 in which the company provided details of a “valuation discrepancy” communicated in February.
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That inventory discrepancy has now been confirmed as related to its dried meats subsidiary Albert Spiess as part of a previously disclosed review of the Orior group’s business operations.
“In its strategic deliberations, Albert Spiess AG decided to focus in the future on its core business of producing Graubünden dried meat specialities.
“In this context, a new home has been found for its gastronomy depots in Landquart and Davos: Mérat AG is acquiring both these depots from Albert Spiess with effect from 1 April 2025, along with the corresponding business and all 15 employees,” the company said in the update today.
Based on new information, Orior said it expects to book an impairment charge of SFr10–12m ($11.2m to $13.5m) at Albert Spiess, “affecting neither cash nor EBITDA”.
The inventory discrepancy was identified as amounting to SFr10m, with an impact on EBITDA but not cash, with SFr2–4m of that relating to the 2023 financial year.
“Full details, including the origin of, and responsibility for this, are being analysed,” the company said.
In another development, Orior said in December that plans for a new “hub” at its Oberentfelden facility would no longer go ahead and today provided an update.
The company said the previously communicated adjustments to its accounts of SFr8m in relation to that discontinued project are expected to have an impact on EBITDA – SFr2-4m to be reclassified in relation to the 2023 fiscal year and SFr4-6m for 2024.
“A sales process has also been initiated for the annex building at the Oberentfelden site, which is not used for operational purposes,” Orior said today.
Another Orior site is also set to be sold, in Olen, Belgium, following the “termination of a large volume contract with a foreign customer in Belgium”.
Orior explained: “A mutual and more considerate interim solution has now been agreed with the customer for part of the volume.
“In order to absorb the effect of the first tranche of the reduction, expected at the end of 2025, the closure of the small plant in Olen, Belgium is to go ahead.”
Orior said it is likely to report currency-adjusted organic growth of 0.5% for 2024, compared to previous expectations for a decline.
However, financial adjustments have led to a downward revision to the company’s EBITDA margin.
Orior now expects a margin of 3.2% to 3.7%, down from the previously projected range of 5% to 5.3%.
Excluding one-off effects, the adjusted EBITDA margin is projected at 6% to 6.5%, down from prior guidance of 8% to 8.3%.
Due to reclassification of plant development costs, Orior has revised its 2024 capital expenditure forecast to SFr37m–SFr39m, down from SFr41m–SFr43m.
In response, Orior’s board of directors will propose suspending dividend payments for 2024 at the upcoming annual general meeting. The final results for last year are due to be issued on 2 April.
Looking ahead, Orior said that its “core business remains robust, and various positive factors for the future have been confirmed”.
Casualfood, its travel catering and foodservice company, secured two major European contracts, winning rights to operate nine new airport outlets for an average term of eight years.
The first locations are expected to open in early 2026.
Culinor, which is focused on ready-made meals, landed a cross-border foodservice contract, while protein-based meal solutions provider Fredag secured a large foodservice order, strengthening sales in the convenience segment.
Non-recurring factors will weigh on 2025 sales, including the partial termination of a large Culinor contract, discontinuation of sales from Albert Spiess depots, and the impact of lost tenders in 2024.
As a result, Orior anticipates a mid-single-digit percentage decline in sales for 2025.
Despite this, the company foresees a stable EBITDA margin, in line with its adjusted EBITDA margin update for 2024.
