Sweet forecast for CSM despite upcoming sugar sale
its sugar division, Netherlands-based ingredients group CSM today
announced strong profits in the first half and is optimistic the
upward trend will continue.
Operating profit before exceptional items rose more than 30 per cent to €66.4m while net turnover amounted to €1.2bn.
In February, in line with streamlining company operations, CSM announced the sale of its sugar business as it was felt the division could not compete in the industry once EU sugar regulations came into force in July.
The company said price pressures lowered EU sugar sales this year but a better harvest boosted the world market.
Even without the sugar business, which recorded a net turnover of €124.6m and operating profits of €21.2m in the first half, CSM said it was hopeful it would achieve 2008 targets.
In a statement, chief executive officer Gerard Hoetmer said: "The sale of CSM Sugar is a historical step for CSM and all the parties involved."
He continued: "The sale of CSM Sugar to Cosun will enable the two organizations to join forces and will bolster the entire chain. It will also secure long-term continuity for the Dutch sugar sector in the rapidly changing European sugar market."
The company expect the sale to Royal Cosun to be completed within the fourth quarter for a provisional sum of €202m.
Poor results for CSM in 2005 prompted an overhaul of the company in which it was decided to focus on its core product ranges.
CSM's main product groups include bakery ingredients and products, lactic acid and lactic acid derivatives, and sugar. With these activities CSM has an annual turnover of €2.6 billion and a workforce of approximately 8,500.
