Raisio 3Q shows need for higher margin products

By Dominique Patton

- Last updated on GMT

Related tags Stanol ester

Raisio's Benecol business continues to be its main driver of growth
as the company battles to increase sales and earnings from its core
activities in margarine and feed ingredients.

Turnover in its ingredients division, which makes the Benecol brand plant stanol esters, increased by 28.1 per cent to €12.3 million during the third quarter thanks to growth in both spreads and yoghurt drinks, said the group yesterday.

But turnover in the recently acquired diagnostics unit remained on a par with last year, while sales from its nutrition business fell slightly to €97.4 million from €99 million in last year's same period.

The company blamed weaker nutrition sales on a drop in malt prices, and poor performance in the potato business.

It is however investing in new healthy food products with better growth potential and higher margins. A plant rented from Valio is scheduled to start producing soy and oat-based products next year and the firm has also concluded an agreement with Finn Cereal to produce 'pure oat' products for people with celiac disease.

Production will start next spring with the introduction of products scheduled for May 2006.

Extra capacity at its stanol ester plant is also due to come on line in early 2006. The ingredients unit could additionally benefit from the production of camelina oil, rich in omega-3 fatty acids, and being introduced in the Raisio portfolio next year.

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