20. 4. 2016.

Bergen, 20 April 2016 – The Norwegian owned Kavli Group puts a lot of its success in 2015 down to the positive developments it has seen in the UK and Sweden. Weakened and uncertain framework agreements in the dairy sector could put the brakes on further growth in Norway.

The food group, which operates in Norway, Sweden, Finland and the UK, increased its operating income by 239 million kroner in 2015, which meant it delivered total revenues of 3.226 billion. The operating profit before tax was just over 235 million kroner, up from 204 million in 2014.

Success with goats’ milk, paté and sauces

“We have seen solid growth especially in the UK and in Sweden, but we are also now starting to see the positive effects of cost reductions following recent investments,” says CEO Erik Volden.

In the UK the Group owns the Yorkshire based dairy, St Helen’s Farm. It has had great success with its goats’ milk-based products. Paté production at Castle MacLellan Foods in Scotland also increased considerably. Kavli has grown to become a considerable producer of sauces, dressings and other condimentsin the Swedish market and in 2015 the group experienced the first annual effect of its 2014 acquisition of Svenska Smaksupplevelser ab.

Framework obstacle to dairy growth in Norway

Kavli’s Norwegian dairy company – Q-Meieriene – also experienced good growth in 2015, but CEO Erik Volden fears weakened and uncertain framework agreements will hinder further development. In 2015 Q-Meieriene had a 24 million kroner shortfall in a state remuneration scheme.

“Q-Meieriene’s further growth depends on our investing in increased production capacity and new products. Regrettably, the current uncertain framework means we cannot make these crucial investments. This will not only weaken our opportunities for further growth, but it will also weaken the general competition in Norway’s dairy market,” Volden says.

Wants further expansion in core areas

Although much of the focus now rests on increased organic growth and cost improvements, Kavli is still looking for more Nordic and UK candidates for acquisition. The acquisitions in Sweden and in England have been particularly successful, but the Kavli Group did not find any interesting candidates in 2015. The Group sold its company in Denmark to Orkla Foods.

“Our Danish operation focused mainly on one product area, cordial. This has not been a core area for the rest of the Group, which meant conditions were less than favourable for the further development of the company. We wish to concentrate on the product areas we know best,” Volden says.

150 million kroner to the Kavli Trust

The Group’s solid performance this year means Kavli’s sole owner, the Kavli Trust, gets an extraordinary large dividend. The Trust will benefit from a record 150 million kroner, up from 50 million in 2015. The Kavli Trust is a charitable trust which donates considerable sums to humanitarian work, research and culture. The Kavli Group is the only Norwegian food company where such a trust is the sole owner and shareholder.

“We have seen a good, steady increase in the surplus which we have paid to the Kavli Trust, but this year’s dividend must be considered to be extraordinary, not reflecting what we normally would have been paying out for a similar operating year. It is nevertheless always a joy for the entire organisation that our surplus creates an ever increasing contribution to good causes,” says Volden.

Results[1]

NOK million                                                2015               2014     Change

Sales                                                        3226,3         2986,9      + 8,0 %

EBITDA                                                       340,6           311,7      + 9,3 %

Operating profit[2] (EBITA)                         235,6           204,4      + 15,3 %

Annual results after tax                              87,9              94,9      - 7,3 %

 

For more information

Erik Volden, CEO, telephone +47 476 02 200

[1] Sales, EBITDA and operating profit adjusted for sale of daughter company.

[2] Before goodwill and brand depriciation.