January 16, 2013 / 9:36 AM / 5 years ago

UPDATE 1-Chr Hansen Q1 profit beats forecast, helped by Americas

* Strong demand for cultures for food products lifts Q1

* Q1 EBIT up nearly 16 percent, beating forecasts (Adds quotes)

By Teis Jensen

COPENHAGEN, Jan 16 (Reuters) - Danish food company Chr. Hansen slightly topped profit rise expectations in the first quarter and said growth this year would be in areas such as North and South America rather than a gloomy Europe.

The group, which makes cultures, enzymes and colours for the food, health and animal feed industries, posted a near 16 percent rise in first-quarter earnings before interest and tax (EBIT) to 47.6 million euros. That just topped a mean forecast for 46.4 million in a Reuters poll of analysts.

Chief Executive Lars Frederiksen said the firm had gotten off to a good start to its fiscal year despite some challenges in Europe and pricing issues in its natural colors division.

“Our outlook is that Europe is not going to be the world’s engine of growth in 2013,” he told Reuters. “One will have to look for growth elsewhere. We are particularly seeing a nice development in our sales in North and South America.”

The group’s cultures and enzymes division, the bulk of its revenues, saw good demand for cultures that go into products such as fermented milk, cheese and meat.

“It is a result that passes on most points,” said Morten Imsgard, an analyst at Sydbank. “It is especially encouraging that the large cultures and enzymes division is doing so well.”

The company’s shares were 0.27 percent lower at 186.50 crowns by 0850 GMT, in line with the local benchmark index.

Chr. Hansen has benefited from increased appetite for natural rather than synthetic food additives among the growing middle class in emerging markets.

But overall revenues in Europe, which represent almost half its sales, were down one percent in the quarter as the euro zone debt crisis weighed on demand.

The firm kept its 2012/13 organic growth outlook, which strips out acquisitions, at 8 to 10 percent, excluding the effect on sales prices from changes in prices for natural colour carmine, as well as a higher EBIT margin than last year.

Chr. Hansen sources one-third of the world’s carmine - a bright natural food colour used in everything from candy to beverages and meat. The colouring, in orange, pink, red and purple, is extracted from insects in Latin America and Spain. (Additional reporting by Mia Shanley and Ole Mikkelsen, editing by Patrick Lannin)

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