US group Hain Celestial this week cut its forecasts for annual sales and earnings amid pressure on its domestic business. The company’s management also presented at the ICR investment conference, where it sought to be upbeat about Hain’s prospects. Staying in the US, Danone warned it could pursue legal action over Chobani’s “misleading and deceptive marketing” which targeted its Light & Fit brand. Elsewhere, Irish dairy co-op Ornua announced the acquisition of Chinese group Ambrosia. And we analysed General Mills’ recent acquisitions of Brazilian yoghurt maker Carolina and US meat snacks firm Epic Provisions. Here is the week in quotes.
“The big change they are doing now is spending like a private-equity group behind these brands. It is going to move us to fighting for share as opposed to growing with the category. This is something we have done before. We have done it in the snack aisle for years. It is not something that is going to preclude Hain from growing in the future” – Irwin Simon, Hain Celestial’s president and CEO, says the US group, which is seeing domestic sales come under pressure, is ready for increased competition from the country’s mainstream food majors.
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“We believe in truthful and honest marketing and advertising, and we are therefore very disappointed that the Chobani campaign misleads and deceives the public about the healthfulness and safety of our Light & Fit brand” – a Danone spokesperson warns the company intends to “pursue all available avenues” – including legal action – to “address Chobani’s misleading and deceptive marketing”.
“We are buying an excellent dairy enterprise which allows us to significantly grow our Chinese business in one step” – Kevin Lane, Ornua’s CEO, on the Irish co-op’s acquisition of Chinese dairy group Ambrosia.
just-food has published research into the factors that will drive M&A in the food industry from now and into 2018.
The full report will be available from just-food in mid-February. However, those who take out an annual subscription to just-food before 31 January 2016, at a 35% discount on standard pricing, will receive free copies of both ‘Drivers of Food Industry M&A’ and another recent report, ‘How Brands Can Win in Online Grocery’, which was written by Professor David Hughes, Emeritus Professor of Food Marketing at Imperial College London and Miguel Flavián. To take advantage of this offer click here.
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By GlobalData“With these changes, we will dedicate more resources to quality improvements and technology upgrades. Additionally, having all manufacturing operations under the same roof as our R&D lab will lead to increased innovation and business growth” – Jason Blake, senior vice president of operations for Oberto Brands explains why the US jerky maker plans to consolidate production at its site in Washington site and end production at two other locations.
“Despite this extremely challenging market environment, Lindt & Sprüngli once again managed to achieve significantly higher sales growth than the chocolate market as a whole and was able to expand its market shares in all strategically important markets” – Lindt & Sprungli continued to grow its business ahead of the global chocolate market in 2015 supported by organic growth and acquisitions.
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“We know there is consumer demand for more plant-based options, particularly convenient products that fit in with their hectic lifestyles and keep them going for longer” – Vicky Upton, marketing controller for Alpro in the UK and Ireland on the launch of Alpro’s new high-protein yoghurt alternative.
“At Walmart, we believe consumers who want to eat organic shouldn’t have to pay more for their groceries. We’re making it easier than ever for customers to have access to quality, organic foods at low prices everyday” – Jennifer Goldspink, vice president for grocery at Wal-Mart’s Canadian arm on the announcement of a new “budget-friendly” line of private-label organic foods.
“The first three categories that grew in Brazil around ten years ago when people found they had more disposable income were yoghurt, chocolate and soft drinks. They got this luxury and now they don’t want to compromise and so are considering own-brand. They are also cutting down on some basics so they don’t have to give up these little luxuries” – Ana Paula Picasso, freelance analyst, says yoghurt is one luxury Brazilians do not want to give up, despite finding their pockets squeezed as the country falls deeper into recession.
“It’s tricky when huge multinational companies buy smaller, upstart brands known for advocacy and authenticity. Quite often, the smaller upstarts lose some of that magic during the transition and end up alienating brand fans that helped make the brand a hit in the first place. Kellogg’s experience with Kashi and the GMO fiasco is an example of what can happen when a brand rubs its biggest fans the wrong way” – Tom Vierhile, innovation insights director at Canadean, reflects on General Mills’ move for fledgling US meat snacks firm Epic Provisions, outlines the challenge facing food majors when they buy up-and-coming companies.
