More than half of companies tracked posted year-over-year gains in share price in 2016.
Photo by Adobe Stock.
Photo by Adobe Stock.
On the London Stock Exchange, Associated British Foods finished the year at 2745p, down 18% from 3342p in 2015 and compared with 3153p in 2014. Charles Sinclair, chairman of ABF, in the company’s annual report called 2016 “a year of progress for the group,” as revenues increased 5% and operating profit increased 3%. He said the company’s grocery and agriculture business units achieved further margin improvement despite the challenges presented by commodity price deflation.
Carr’s Group PLC’s share price closed at 149.38p in 2016, down from 154p in 2015. On Sept. 5, 2016, Carr’s announced the sale of Carr’s Flour Mills Ltd., the group’s food division, to Whitworths Holdings Ltd. for £36 million. With the sale, Tim Davies, chief executive officer of Carr’s, said the company would “continue to focus on our strategy of delivering growth in our U.K. agriculture business, the development of our international feed supplement businesses and building our specialist engineering division in niche markets across the globe.”
Tate & Lyle PLC, the global sweetener company, had a 52-week low of 529p and a high of 850p, but it ultimately ended the year at 707.5p, up 18% from 599p in 2015. During fiscal 2016, the company completed a number of major structural change initiatives, including the realignment of the Eaststarch joint venture in Europe, the restructuring of the Splenda sucralose business and the expansion of capacity for Speciality Food Ingredients.
Premier Foods, the U.K.’s largest food producer, finished 2016 at 46.75p, up 19% from 39.25p in 2015. Premier entertained talks with McCormick & Co., Inc. about a possible merger in early 2016 before McCormick ultimately decided not to pursue an acquisition of the maker of sweet goods, cooking sauces, flavors and seasonings, and soups. Shortly after the announcement and after several years of discussing potential strategic opportunities, Premier agreed to enter into a co-operation agreement with Nissin Foods Holdings Co., Ltd., Tokyo. The partnership has the potential for “significant long-term value creation for both organizations,” Premier said.
Finsbury Food Group PLC, a U.K.-based maker of cake, bread and gluten-free bakery goods, climbed as high as 139p before closing 2016 at 120p, up from 113p in 2015 and compared with 60p in 2014.
Greggs PLC, an operator of retail bakery shops and cafes in the United Kingdom, finished 2016 at 970p, down 26% from 1314p in 2015, and compared with 732p in 2014 and 430.5p in 2013.
In Ireland, Greencore Group PLC, a European maker of convenience food and malt products, finished at 246.5p, down 15% from 291.37p in 2015. In January, Greencore completed the acquisition of Geneva, Illinois, U.S.-based Peacock Foods for $747.5 million.
“The acquisition of Peacock will transform our U.S. business, strengthen our position in high growth categories, broaden our channel and customer exposure, and add significant scale to our operations,” said Patrick Coveney, CEO of Greencore. “We believe Peacock’s success is built on the same fundamental strategy and values that drive Greencore.”
Kerry Group finished the year at €67.67, down 12% from €76.84 in 2015. In an April 27, 2016 conference call, Brian Mehigan, chief financial officer, said the pipeline in North America continues to be strong.
“The work we’re doing in terms of the taste, particularly into the beverage sector, we continue to deliver good growth in the whole savory meals, appetizers, into the meat sector, with clean label,” he said. “And the combination of the desire at consumer level for more healthy, more nutritious, but taste being a key differentiator all the time. The repositioning of products from the center of the store to the periphery in terms of more natural, more home cupboard style, is really driving the innovation pipeline there, so very positive about that.”
Origin Enterprises, a food and agribusiness group based in Dublin, finished the year at €6.35, down 16% from €7.55 in 2015 and compared with €8.45 in 2014.
GrainCorp up 11%
Agrium Inc. closed 2016 at $100.55, up from $89.34 in 2015. In July, Agrium, through its Crop Production Services business, reached an agreement to acquire 18 ag retail locations from Cargill AgHorizons. The outlets are located across the northern U.S. Corn Belt region, in the states of Nebraska, South Dakota, Minnesota, Wisconsin, Michigan and Indiana, and have annual sales of approximately $150 million.
In France, Groupe Danone S.A., the country’s largest food and beverage company, closed 2016 at €60.20, down narrowly from €62.28 in 2015 but up 14% from €54.45 in 2014. Danone in July entered into an agreement to acquire The WhiteWave Foods Co. for $56.25 per share in a deal valued at approximately $12.5 billion including debt and other obligations. Based in Denver, Colorado, U.S., WhiteWave Foods is an international competitor in the plant-based, organic dairy and organic produce categories. The company owns such brands as Silk, So Delicious, Horizon Organic, Earthbound Farm and Alpro. The company generated approximately $4 billion in sales during fiscal 2015.
In the Netherlands, Unilever, the Anglo-Dutch food and personal products business, closed 2016 at €39.12, down from €40.11 in 2015. On July 1, 2015, Unilever established its Baking, Cooking and Spreads (BCS) business as a stand-alone entity within its Foods business unit. The move came at a time when the business was struggling and company CEO Paul Polman said he would wait a year to see how the business performed before deciding what next steps to take. During the Bernstein 13th Annual Pan-European Strategic Decisions Conference, held Sept. 20-22, 2016, in London, it appeared management’s focus is now on preserving the business rather than growing it.
Corbion finished higher in 2016, moving up 14% to €25.43 from €22.32.
In Switzerland, Nestle S.A., the world’s largest food company, closed at 73.05 Swiss francs, down 2% from 74.55 Swiss francs in 2015. On Jan. 1, Ulf Mark Schneider took over as CEO of Nestle S.A. The move reinforces Nestle’s shift toward health and wellness, as Schneider most recently was CEO of Fresenius Group, a German health care company. Schneider replaced Paul Bulcke, who is proposed for election as Nestle’s chairman of the board of directors this April. Bulcke would take the place of Peter Brabeck-Letmathe, who will retire in April after working for Nestle for 50 years.
Aryzta AG closed 2016 at 44.85 Swiss francs, down from 51 Swiss francs in 2015 and compared with 76.95 Swiss francs in 2014. In May, Aryzta began the retail roll-out of Otis Spunkmeyer sweet goods by introducing a line of 20 pre-packaged products. The consumer-focused retail line, which features a “No Funky Stuff” tag line, includes snack cakes, loaf cakes, mini muffins, mini cupcakes, and cookies in a variety of classic flavors.
Nisshin down 12%
The company has a flour milling segment that manufactures and sells wheat flour, bran and bakery mixes.
Photo by Adobe Stock.
Photo by Adobe Stock.
Nippon Flour Mills Co. Ltd. fell 6% for the year, easing to Y1626 from Y1724, and Nissin Foods Holdings, a leading manufacturer of instant noodles, fell to Y6140 from Y6430.
Baking leaders Yamazaki Baking and First Baking Co. Ltd. were mixed in 2016. Yamazaki closed at Y2258, down 17% from Y2735 in 2015. Yamazaki Baking, Japan’s largest baking company, in November said it plans to invest $183 million in a new baking plant, the company’s first new facility in 28 years. The plant will help the company meet growing demand for grab-and-go sandwiches and snacks, the newspaper said.
First Baking, meanwhile, finished at Y137, up from Y116 in 2015.
Olam International, a leading agribusiness operating from seed to shelf in 65 countries, supplying food and industrial raw materials to over 13,800 customers worldwide, finished at 1.99 Singapore dollars, up from 1.82 Singapore dollars, in 2015. In January 2016, Olam agreed to acquire Amber Foods Ltd., which through its 100% owned subsidiary, Quintessential Foods Nigeria Ltd., owns the wheat milling and pasta manufacturing assets of the BUA Group in Nigeria, for a total enterprise value of $275 million. The assets to be acquired include two wheat mills and a pasta manufacturing facility in Lagos, a non-operating mill in Kano in northern Nigeria, and a wheat mill and a pasta manufacturing plant under construction in Port Harcourt in the southeastern Nigeria.
Wilmar International, which operates in four segments — tropical oils, oilseeds and grains, sugar and others — increased 22% to 3.59 Singapore dollars from 2.94 Singapore dollars in 2015.
Indonesia’s Indofood, one of the largest food producers in Asia, increased 53% to R7125 from R5175 in 2015.
South Africa-based Tiger Brands Ltd. rose sharply in 2016, finishing at R39783, up 26% from R31644 in 2015.
Egyptian companies engaged in flour milling were higher in 2016, led by a 52% gain at Middle and West Delta Flour Co. Other gains included: East Delta Flour Co., up 50%; Middle Egypt Flour, up 40%; South Cairo and Giza Flour Mills, up 32%; Upper Egypt Flour, up 25%; Egyptian Starch, up 12%; and North Cairo Flour, up 6%.
In Africa, Flour Mills of Nigeria PLC fell 11% after declining 48% in 2015 and 50% in 2014. Flour Mills Nigeria is primarily involved in flour milling, pasta production and cements production.
In Spain, Ebro Foods shares rose 10% to €19.91 from €18.16. Ebro Foods on Jan. 1 merged its U.S. rice and pasta companies, a move that will create the largest manufacturer and marketer of rice products and the second largest producer and distributor of pasta products in the United States. The merger will bring together Riviana Foods Inc., American Rice, Inc. and New World Pasta Co. The companies will be headquartered in Houston, Texas with a satellite office in Harrisburg, Pennsylvania, and will operate under the Riviana Foods name.