Higher volumes mark 1Q for speciality fat firm Aarhus

Sales volumes improve for speciality fats but bulk vegetable oils continue to feel the pressure in the first quarter for fats and oils firm Aarhus United.

The Danish company, up for sale since October 2004, saw pre-tax profit rising by 27 per cent to DKK53.9 million (€7.23m) for the three months to January 2005, on sales of DKK1.18 billion (€158 million).

The speciality fats unit, the largest slice of the firm's business and its strategic focus, brought in about 45 per cent (DKK126m) of the total DKK227 million net margin, the company reported yesterday.

The latest figures show a production loss at Aarhus United USA but gains in the other production companies dotted around the globe (Denmark, UK and Mexico).

The future of Aarhus has been under some uncertainty for several months, since UIE, citing a potential difference in long-term investment interests, announced in October 2004 it would divest its 45.6 per cent chunk of Aarhus by January 2005.

But as this last set of results falls, the Danish firm has yet to announce a buyer.

Rumours last month pitched Chinese farm and chemical group, Gansu Yasheng group, as the new future owner. Financial daily Børsen reported that negotiations with the Chinese conglomerate were expected to close by the end of April.

But at the close of the month, Aarhus told shareholders that "efforts to conclude a sales agreement" had turned out to be "more complex than initially anticipated."

The firm assured the stock exchange that it would "submit an announcement of the outcome before the end of 2nd quarter 2005."

In addition to UIE, a pension fund owns over 10 per cent of cocoa butter replacer Aarhus, and a further fund has 5 per cent, while private investors make up the remaining approximate 40 per cent.