CSM baking unit EBITA up 36% in quarter

by Eric Schroeder
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DIEMEN, THE NETHERLANDS — EBITA of the Bakery Supplies North America division of CSM for the first quarter of fiscal 2011 totaled $30.8 million, up 36% from $22.6 million in the same quarter a year ago.

Excluding one-off costs related to the acquisition of Best Brands, EBITA in the division was $36.1 million, up 16% from $31.1 million. Sales for the segment were $537.1 million during the quarter, up 30% from $414.4 million during the same period a year ago.

“Organic sales growth at Bakery Supplies North America was slightly positive at 2.1%, driven by our efforts to increase selling prices (6.9%) to compensate for higher costs,” CSM said in an April 27 trading statement. “As we took the lead in driving pricing growth to protect profitability, this came at the expense of volume (-4.8%), which we expect to recover in future periods. The acquisition of Best Brands, although difficult to calculate in the fully integrated company, contributed an additional $112.9 million to the Q1 sales.”

Bakery Supplies Europe EBITA was €12.4 million ($18.2 million) for the first quarter, down 24% from €16.4 million in the previous year. Sales were €264.1 million ($387.7 million), up 7% from €247.3 million during the previous year.

Overall, CSM EBITA was €37.9 million ($55.7 million) in the first quarter, down 6% from €40.5 million during the same period a year ago. Excluding one-off costs, EBITA was €43.8 million ($64.3 million), down 6%. Sales for the first quarter were €759.8 million ($1,115 million), up 18% from €644.1 million during the previous year.

“The first quarter has been dominated by our commitment to increase prices in the market to compensate for higher costs,” said Gerard Hoetmer, chief executive officer. “As market leader, we have continued to show leadership, demonstrated by an average 6.4% and 5.2% price increase in Bakery Supplies and Purac, respectively, compared to the first quarter of 2010. Our increase in product pricing, where we have responded to protect our profitability, affected our volume growth, while our sales continued to grow.”

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