Ebro profits as consumers stock up on rice and pasta during lockdown
36% jump in annual profit
Ebro Foods reported on Thursday a 36% jump in annual profit, with its rice and pasta products particularly popular as coronavirus restrictions forced people to eat more at home. The Spanish owner of brands such as Tilda rice in Britain and pasta makes Garofalo in Italy and Panzani in France, said that its sales increased 15% in 2020 to 3.24 billion euros in an “exceptional” year. That resulted in an annual net profit of 192 million euros.
The company, the world’s second-biggest vendor of packaged rice, had to rearrange its production last year to meet unusually high peaks in demand for rice and pasta. It cautioned that 2021 would be a difficult year but that it should be able to weather the challenges. Ebro said it expects higher costs from more expensive raw materials and freight fees, as well as lower demand from consumers whose earnings have been affected by COVID-19 restrictions.
The company also expects pressure on prices from supermarkets, saying renewed competition will lead to price wars.
Garofalo continues to lead the way in the premium segment and posted 40% growth in countries such as Spain and France.
"We are braced for a foreseeably complicated 2021, - the Company explains - owing to uncertainty regarding the evolution of the pandemic, high inflation in freight and commodities, impoverished consumers fatigued by the seemingly unending health crisis, pressure from distribution, the return of promotions and reactivation of competition. In the face of this complex scenario, we place our trust in the strength and soundness that our business model has already shown in other adverse circumstances".
EFA News - European Food Agency