Italian dairy group Granarolo saw its profits drop in 2010 on the back of what it described as a “complex economic scenario”, hit by rising raw-material costs and the economic crisis in its domestic market.

Granarolo said on Tuesday (22 March) that it recorded EUR3.2m net profit during the year ended 31 December against EUR18.6m net profit in 2009. EBIT nearly halved to EUR36.4m against EUR63.4m in 2009.

Go deeper with GlobalData

Data Insights

The gold standard of business intelligence.

Find out more

Related Company Profiles

View all

It said consolidated sales reached EUR884.3m against EUR899.9m in 2009.

The company said its sales decline reflected, among other factors, the impact of the growth of private-label products.

However, Granarolo said that it was well placed for future growth, as it is the “first player on the market on fresh milk and UHT milk”.

Chairman Gianpiero Calzolari said that the group has been able to “maintain stable revenues despite the economic crisis”. However, margins have been affected by the by price volatility and strong inflationary pressures that has led to a “significant increase in the cost of raw materials that have not been passed on”.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Calzolari said the company is looking to offset inflationary issues and uncertainty around any recovery in consumption with a “massive push for innovation” through new products, targeted acquisitions and a strengthening of its international position in markets that are “importing quality Italian products”.

Calzolari was quoted as saying earlier this week that it would be interested in joining a consortium in order to keep rival Italian dairy group Parmalat in Italian hands. However, the manufacturer confirmed that the company does not have the financial resources to buy Parmalat by itself. Parmalat’s future is the subject of speculation in Italy following the acquisition of a 29% stake in the business by France’s Lactalis.

Looking to 2011, Granarolo said that it expects to be significantly impacted by the “dynamics of prices of major inputs used by our company”, adding that raw milk prices have already risen by 18% during the first quarter of the year.

Granarolo said it is working on cost containment programmes to help offset these increases and has already established a plan to reduce its fixed costs.