Cloetta Fazer reports increased sales but lower operating profit

Cloetta Fazer reports increased sales but lower operating profit

Cloetta Fazer's sales for the third quarter rose by 8 per cent to SEK 745
million (692). Operating profit excluding restructuring charges for the third
quarter is reported at SEK 67 million (89). Operating margin was 9 per cent
(12.9).

“Cloetta Fazer increased its confectionery sales in the third quarter, partly
due to the successful launch of new products. The relatively cool summer in the
Nordic region also contributed to the period's sales growth,” says Cloetta
Fazer's CEO Jesper Åberg. 

“Despite robust sales, however, Cloetta Fazer recorded a lower profit owing
mainly to increased costs for raw materials, manufacturing and sales/marketing
activities,” he adds. “To compensate for the higher raw material costs it will
be necessary to raise our market prices, as announced in the first quarter
report. Aside from that, we are further optimising our production efficiency
through both production investments and the already announced staff reductions.”

Cloetta Fazer's share of the total Nordic confectionery market is 22 per cent.
The company has its strongest position in Finland, with a market share of 40 per
cent, followed by 24 per cent in Sweden.

“The acquisition of AB Karamellpojkarna, which we informed about on 1 October,
is being undertaken as part of our growth strategy. The company is the third
largest supplier of throat lozenges in Sweden and the acquisition will boost our
total sales by approximately 2 per cent,” concludes Jesper Åberg.

Net sales for the nine-month period grew by 3 per cent, or SEK 63 million, to
SEK 2,143 million (2,080). Operating profit was SEK 158 million (211). Operating
profit excluding these charges was SEK 179 million (217). This is equal to an
operating margin of 8.4 per cent, compared to 10.4 per cent the year before. Net
profit amounted to SEK 129 million (158).

For additional information contact
Jesper Åberg, CEO and Managing Director, mobile +46 (0)70-180 21 01 
Curt Petri, CFO and Deputy Managing Director, mobile +46 (0)70-593 21 69
Website: www.cloettafazer.com

About Cloetta Fazer 
The Cloetta Fazer Group is the Nordic region's leading confectionery company,
with a market share of around 22 per cent. The company has production facilities
in Sweden and Finland. Cloetta Fazer's strength lies in its many popular brands,
such as Karl Fazer, Kexchoklad, Dumle, Geisha, Polly and Center. The average
number of employees is around 1,500 and annual sales amounts to approximately
SEK 3 billion.