Food Union Group in Latvia maintains turnover at eur 116 million and increases export revenue by 18%
Latvia’s leading dairy company Food Union last year maintained its annual turnover at the same level as in 2016 and reached EUR 116 million. Food Union group company joint-stock Rīgas Piena Kombināts and its subsidiary joint-stock Valmieras Piens had a total turnover of EUR 82.4 million in 2017, while SIA Rīgas Piensaimnieks achieved EUR 33.5 million in turnover last year.
Last year, Food Union was successful in substantially increasing export revenue, which reached EUR 11.9 million and was 18% more than in 2016. The company’s main export markets in 2017 were Azerbaijan, Lithuania, Russia and Estonia, with the company successful in increasing Food Union exports the most in Estonia and Denmark.
“In accordance with the company’s objectives, Food Union in 2017 continued to focus on the development of such strategic areas as high-quality and healthy dairy products, as well as the production of unique ice cream for consumption. Overall, the company created 25 new products, of which especially successful were such ice creams as chocolate plombir Pols in cones, as well as blackcurrant flavor Ekselence brand ice cream, ice cream with Riga Black Balsam and Kārums cheese-cakes, with which we were able to strengthen our position in the dessert category,’’ said Normunds Staņēvicš, Food Union group financial director in Europe.
At the end of last year, the Food Union group also began work on creating a Center of Excellence focusing on fresh dairy products, with EUR 11.1 million planned to be invested in this project by 2020. As a result, as production in Riga will concentrate in one new and modern production plant, thus strengthening Food Union’s leading position in the creation of innovative new products and allowing to expand the company’s range of products.
“Looking back at our financial figures from laat year, it is important to understand several nuances. First of all, Food Union group in Latvia is made up of three united and mutually integrated dairy companies, which is why their financial figures must be looked as one whole. Second of all, there were considerable fluctuations in the price of raw milk in 2017, from the historically lowest leve to the highest, which of course impacted our business as well,” explains Artūrs Čirjevskis, SIA Rīgas Piensaimnieks board member and Food Union group financial director in the Baltics and CIS countries.
Food Union group’s overall gross profit in 2017 reached EUR 24.2 million. Of this, EUR 14.7 million was profit made by joint-stock Rīgas Piena Kombināts and its subsidiary joint-stock Valmieras Piens, which due to a substantial increase in the price of raw milk was by 12% less than in 2016. Meanwhile, SIA Rīgas Piensaimnieks posted a gross profit of EUR 9.5 million last year, which was by 16% less than the previous year, which also is explained by a substantial increase in the price of raw materiāls in Europe.
In 2017, the Food Union group in Latvia (in Riga and Valmiera) had approximately 1,250 employees. Last year, the company paid into the national budget EUR 9.2 million in taxes, as well as invested EUR 1.69 million in development, including in the modernization of production technologies, the creation of new products as well as improving infrastructure.