The chief executive of Dutch food group Wessanen said his confidence in the company was growing after it reported a jump in third-quarter profits.
Wessanen booked underlying EBIT of EUR6.2m (US$8.8m), up nearly four-fold on last year’s EUR1.6m when the company invested heavily after falling profits led to a decision to focus on the organic sector.
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The company reported net profit of EUR8.1m, compared to EUR1m a year ago.
Revenue increased 0.5% to EUR174.3m. However, Wessanen said revenue from continuing operations and excluding the impact of currency fluctuation and M&A increased 8%.
Sales from Wessanen’s grocery division, which accounts for a third of revenue, were up 7.5%. The company’s US drinks arm ABC saw sales jump 53.5%.
CEO Piet Hein Merckens said he was “increasingly confident” with the company’s progress and the results it was reporting.
“We are cautiously optimistic. We have a strong team in place and the execution of our strategy is progressing,” he said.
However, Merckens said some parts of the business needed to improve and he also pointed to the economic uncertainty in Europe.
“Some signs of improvement are already showing in different areas, for example at Grocery, whereas in some other areas improvements are yet to be seen and remain the focus of our efforts. We also have to deal with an element of uncertainty due to persistently subdued European economic environment and pressured consumer confidence. Despite these macroeconomic challenges we are firmly determined to improve our performance step-by-step and further solidify our positions and brands in the European organic markets,” he said.
Shares in Wessanen were down 5.39% at EUR3.58 at 15:37 CET. However, analysts said Wessanen’s stock had risen in recent weeks and investors were profit taking.
“Shares have increased 20% year-to-date on good news-flow and a couple of investors are now realising their profits,” SNS Securities analyst Richard Withagen told just-food.
