Sale looms but Aarhus posts upturn in 2004 results
fading sales and tighter margins, Danish vegetable fats supplier
Aarhus United is on the up, with the company marking improved
growth for 2004, writes Lindsey Partos.
Sales for the group, that includes bulk oils and food service divisions, rose 10 per cent on 2003 to DKK4.97 billion (€669m): pulling in an operating profit of DKK233 million (€30m) against DKK153m for the previous year.
But reflecting an industry-wide trend, rising raw material costs sliced into margins at the Aarhus-based firm.
A bulk oil supplier, Aarhus reported on "severe price competition that continued to affect bulk vegetable oil net margins", despite a boost to sales volumes.
The turnaround in figures will be welcomed by the majority shareholder, United International Enterprises Limited (UIE), that announced in October last year it would divest its 45.6 per cent chunk of cocoa butter replacer Aarhus United.
UIE firm cited a potential difference in long-term investment interests for the sell-off, claiming a new partner might better serve Aarhus.
But several months on, UIE is "still in negotiations", a spokesperson at Aarhus recently told FoodNavigator.com, declining to comment on whether this involved one, or several, companies.
In addition to UIE, a pension fund owns over 10 per cent of Aarhus, and a further fund has 5 per cent, while private investors make up the remaining approximate 40 per cent.
Industry rumours had previously hinted that Swedish fats firm Karlshmans could be interested in picking up the UIE slice. But competition continues to bite for the firm, that announced in December it would pour €6.68 million (SEK60m) into cost-cutting measures. A move that followed swiftly on from some 50 job cuts in October.
