CEO Matti Rihko's review Q2/2016
"Raisio continued to improve its operational result during the second quarter. Our comparable EBIT grew by 7 per cent totalling EUR 15 million. Our relative profitability increased from some 10 per cent to 12 per cent of net sales.
In April, we licensed our Honey Monster brand to the British cereal producer Brecks. Brecks started the production, marketing and sales of Honey Monster cereals on 1 July 2016. In July after the review period, we also divested our Newport snack bar business to the Dutch equity investor Nimbus.
Both Honey Monster and Newport were loss-making so the divestment will improve our operational cash flow. In Southall, we still own the land of over three hectares located in one of the most important urban development areas in London.
In the short term, Brexit affects particularly through exchange rates but the pound, even weakened, is still within its ten-year currency range. So it is essential to manage the company's own operative business well. Long-term effects are difficult to predict and therefore, it is important to maintain the ability to be flexible in changing situations. In all scenarios, the UK will continue to be the second largest consumer market in Europe.
With Benemilk's international licensing, we decided to take a time out because, due to the crisis facing the dairy market, it seems that customers are not ready to change their feeding models within the next couple of years. Even though Benemilk Ltd is now becoming dormant, the consolidation of its IP portfolio continues; the portfolio will be made a ready, strong package. In Australia, we had an encouraging proof of the IP's strength as the Benemilk feed and the milk produced through Benemilk feeding were granted a patent in July. In Finland, Benemilk has made a breakthrough and Raisioagro will continue its sale as usual."