Parmalat lowers 2013 profit forecasts
Italian dairy giant Parmalat has this week indicated its profits (EBITDA) will grow by just 2% this year compared with the 5% previously indicated.
They are blaming a sudden weakening of demand and higher milk prices. The company says it has been unable to offset its higher input costs (milk prices) with higher sales prices due to softening demand.
French dairy company, Lactalis, acquired a majority stake in Parmalat following the financial difficulties the company experienced in 2011.
Unilever to shed 2,000 jobs
International conglomerate Unilever announced this week that the company plans to shed 2,000 workers from its global workforce as it attempts to reduce costs.
This cost reduction programme reflects the challenges the group faces across many markets and divisions, with slower growth than predicted.
The company aims to shave €500m in costs in 2014 which is on top of the €1bn supply chain savings they had already earmarked.
Unilever’s current profit margins are some 0.5% behind its peers, where they remain focused on adding further value in their sales outlets and also are on the lookout for bolt-on acquisitions, in particular across emerging markets.
Unilever owns many global brands, such as the Ben and Jerry’s ice cream brand.
Dairy Crest closes
Welsh dairy
Dairy Crest announced plans to close its Proper Welsh dairy, just nine months after buying the business, where the group has entered into a 30-day consultation period with its employees.
The closure of this facility could see the loss of up to 312 jobs. However, some of these roles are likely to be transferred to other Dairy Crest facilities.
The closure arises as production volumes have ‘fallen short of expectations’ and where this facility requires a significant investment to bring the site up to optimum standards.
Dairy Crest CEO Mark Allen also outlined how lower sales and higher costs have rendered this plant uneconomical to run.
Retailers go to war
Aldi has recently launched high court proceedings against Dunnes Stores where Aldi alleges Dunnes Stores has inappropriately used its name and prices in advertisements.
Aldi won a similar battle against Tesco only last year.
Discounters Aldi and Lidl have acquired significant market share at the expense of Dunnes Stores and Tesco in recent years.
Recent market share data highlights that the discounters continue to grow their market share at the expense of their more traditional retailer neighbours as their sales cautiously increase by double digit percentages each quarter.
With grocery inflation continuing to be a pressing issue, prices continues to be the dominant theme for Irish shoppers.
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