Quarterly income up 19% at CSM
October 28, 2010
by Jeff Gelski
DIEMEN, THE NETHERLANDS — Third-quarter underlying earnings before interest, taxes and amortization (EBITA) increased 19% for CSM as all three of its divisions posted organic sales growth, the company said Oct. 27. Third-quarter sales increased 24% thanks in large part to the Best Brands acquisition.
EBITA, excluding one-off integration costs associated with Best Brands, of €56.7 million ($78.7 million) compared with €47.6 million in the previous year’s third quarter. Currency effects impacted results positively by €3.8 million. The Best Brands acquisition impacted EBITA by €3.8 million, including integration costs of €3.4 million.
Third-quarter sales were €783.7 million ($1,088.5 million), which compared with €634.5 million in the previous year’s third quarter. The Best Brands acquisition had an effect of €95.2 million. Other effects came from positive currency (€45.1 million) and organic growth (€8.9 million).
Bakery Supplies North America in the third quarter had EBITA of €29.7 million, up from €26.9 million in the previous year’s third quarter, and sales of €418.4 million, up from €286.4 million. The overall sales growth of 31% was largely due to the consolidation of Best Brands. A positive price mix effect of 1.4%, partly offset by a negative volume effect of 0.4%, drove organic sales growth of 1%.
Bakery Supplies Europe in the third quarter had EBITA of €16 million, up from €12.2 million, and sales of €260.9 million, up from €255.7 million. Purac in the third quarter had EBITA of €14.4 million, up from €14.2 million, and sales of €104.4 million, up from €92.4 million.
Companywide for the year’s first three quarters, Diemen-based CSM had EBITA of €145.2 million, up from €108.3 million, and sales of €2,199.5 million, up from €1,918.2 million. CSM said it remains cautiously optimistic for the fourth quarter.
“The main contributor to market growth is consumer confidence, which is still weak in a number of markets,” CSM said. “Our raw material positions are carefully managed by our procurement organization and are sufficiently covered, although at a somewhat higher price level for the remainder of the year.”