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Parmalat directors quit in spite of positive 2015 results

By Jim Cornall+

11-Mar-2016
Last updated on 11-Mar-2016 at 15:49 GMT2016-03-11T15:49:50Z

Italian dairy company Parmalat had a busy 205, with acquisitions in Latin America, Australia and Italy.
Italian dairy company Parmalat had a busy 205, with acquisitions in Latin America, Australia and Italy.

Italian dairy company Parmalat’s net revenue for the financial year ending December 31, 2015, rose from $6.08bn (€5.5bn) to $7.1bn (€6.4bn), however, profits fell from $228m (€205m) in 2014 to $164m (€147.6m).

However, on the same day the Board of Directors approval of the 2015 draft of the financial statements was announced, three of the board of directors resigned.

A Parmalat statement said that Antonio Sala was the first director to hand in his resignation, effective April 29, which will be when a shareholders’ meeting is held to approve the 2015 financial statements.

It said, "The resigning Director stated that, even though Parmalat once again reported increased results and demonstrated a propensity to tackle challenging industrial demands, he felt the need to hand in his resignation due to the continuous recurrence of contrasts within the Board of Directors."

Fellow directors Yvon Guérin and Patrice Gassenbach concurred, and in turn handed in their resignations from the board, effective the same date, said the communication from Parmalat.

The resignations triggered the expiration of the term of all the board, meaning a new board will be elected at the next shareholders’ meeting.

Global figures

The figures in Latin America (South America and Mexico) proved to be positive for the company, with gains of 98.4% for net revenue and 104.4% for EBITDA.

In Europe, net revenue totaled $1.22bn (€1.094bn), compared to $1.25bn (€1.12bn) in 2014.

The North America area (US and Canada), reported net revenue of $2.72bn (€2.45bn) in 2015.

The significant increase in the value of the US dollar and Canadian dollar versus the euro had a positive impact on net revenue, amounting to about $224.6m (€202m).

Revenue hits €1bn in Oceania

There was modest growth of 6.4% for net revenue in Africa.

In the Oceania area, net revenue reached the$1.1bn (€1bn) mark in 2015, an increase of $51.3m (€46.1m) over 2014.  

Acquisitions

In 2015, Parmalat continued its plan of growth through acquisitions, acquiring the Esmeralda Group, which operates in Mexico, Uruguay and Argentina, and, in Brazil, some assets of Lácteos Brasil – Em Recuperação Judicial, Elebat Alimentos, the dairy division of BRF, and Nutrifont.

 In addition, Parmalat finalized the acquisition of Longwarry in Australia, and of the business operations and brand of Latterie Friulane, in Italy.

2016 expectations

Parmalat said that 2016 will still see a dairy market still characterized by excess production of raw milk, with dynamics similar to those that caused an across-the-board reduction in raw material costs in 2015.

Parmalat says it will therefore prioritize implementing a pricing policy, paying particular attention to relationships with retailers and major competitors; staying focused on the efficiency of the industrial system through a strong commitment to up-to-date technologies; and improving the ability to innovate products.

For the recently acquired businesses in Latin America and Australia, the company says the priority will be on reorganization aimed at achieving full integration.

Overall, Parmalat said it expects gains of about 5% for net revenue and about 10% for EBITDA.

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