Polish meat business to boost production capacity with investment strategy

The company has said it will invest in new pig farms, allocate funds to raise the efficiency of its slaughterhouse, expand to new export markets, and integrate the company’s meat processing activities with the aim of optimising its performance.

“In the newly-adopted action strategy, the company foresees it strengthening its position as one of the leading red meat producers in Poland, and ​[reaching] a maximum balance between the respective segments of its activity, which will contribute to increasing its effectiveness and acquiring a competitive advantage,” ​said the Polish group in a filing to the Warsaw Stock Exchange.

Investment in capacity​

In addition to this, Gobarto also plans to invest in its subsidiary, local meat business ZM Silesia, and raise the company’s meat processing capacity “to strengthen the market position”​ of its offshoot, the group said.

Gobarto acquired ZM Silesia in 2017 in a deal worth PLN78 million (€18m).

Within the meat distribution sector, the group plans to increase its sales volume with the use of its assets and “potential acquisitions”, ​according to the filing. 

The value of the planned investments was not disclosed.

Gobarto is pursuing a programme to develop pig breeding across the country in cooperation with local farmers. Under the Gobarto 500 program, the company is recruiting farmers and providing support to their investments. The recruited farmers provide their land, allowing pig breeding facilities with capacities of up to 2,000 head to be developed. Gobarto signs 15-year contracts with the farmers, who are also allocated financial support.

The group said it was the largest player in Poland’s red meat slaughtering, cutting and distribution industry, and has more than 30 subsidiaries located in Poland, Germany and Ukraine.

Gobarto sells pork, beef, and game meat and employs more than 1,500 staff. Among the group’s assets, it operates a slaughterhouse in Grąbkowo, in the country’s western region, fitted with a capacity of about 1m head per year. The group also runs a meat processing plant in Ciechanowiec, in north-eastern Poland. 

In 2017, the domestic market accounted for about 85% of the group’s revenues. 

Gobarto operated under the brand of PKM Duda until October 2016 when it changed its name. Since 2002, the group has been listed on the Warsaw Stock Exchange. Polish poultry meat producer and processor Cedrob S.A. is Gobarto’s largest shareholder, holding an 85.56% stake in the company.