Artoparto's Blog - Just superficially about Atria Plc and HKScan Plc in Tarzan-English
A blog concentrating
on Finnish food companies Atria Plc and HKScan Plc, both operating in the
Baltic Sea region, is about to
begin. The blog will be updated every
other Friday, occasionally more often. Today we will take a brief look at Atria’s
most interesting activities right now.
Old news: Atria planning to abandon its primary production in Russia
It may be somewhat bizarre to start the whole blog with
old news, without even knowing whether it is already processed and discussed
thoroughly in magazines, financial newsletters, reviews, discussion forums
etc.
Anyway in the news, picked from a Finnish regional newspaper
Ilkka on Friday, July 27th, we are told that Atria plans
to abandon its primary production in Russia. The reason, CEO of Atria Plc Juha Gröhn says,
is that the next steps would require too large investments.
Indeed Atria has its pile of dept but there
may be a more specific reason too. It is
possible, that Atria Russia has severe problems with farming. A fact is that the dreaded African Swine
Fewer (ASF) has spread strongly in Russia and is nearly out of control
especially in southern parts of the country.
On July 31st Rosselkhoznadzor, Federal Service for
Veterinary and Phytosanitary Surveillance reported of new
outbreaks of ASF in Russia. Genetic
material of the virus of ASF had been detected in the samples taken from dead
pigs kept on a pig-breeding enterprise “Dankub” at the village of Maryanskaya, Krasnodar region. Rosselkhoznadzor also keeps
a list and a map of active outbreaks of ASF in Russia.
On a recent list and map, there is mentioned: STF JSC "DanKub" st.Maryanskaya,
Krasnoarmeysky district.
Atria has announced earlier, that their pig farming partner in Russia is a
Danish company Dan-Invest A/S and the project consists of two pig farms, one in
Tambov and one in Krasnodar. On Dan-Invest’s
net pages one can find the address of their farm called Dan-Kub: ZAO DAN KUB 3200 meters to north-east of the
village odf Maryanskaya, Krasnoarmeisky District, Krasnodar Krai, Russian
Federation. (One possible typing error is not corrected
and spelling of the names is left unchanged.)
So, there are chances, that the farm mentioned on
Rosselkhoznadzor’s pages, is Dan-Invest’s and Atria’s farm in Krasnodar.
Lack of money, severe problems with farming, whatever
the reasons are, leaving their primary production in Russia is big news. Atria’s risks will be diminished but at the
same time company's enlargement prospects will weaken.
However, Atria Plc has at least one interesting brand with
some growth potential. It is the proud Sibylla from Sweden.
Fast-food chain Sibylla
Sibylla has spread rapidly in recent years especially
in Poland and Russia. Its
international concept is well summarized by its slogan: Sibylla is inside. Outlets are typically at service stations. In Finland various
sports arenas along with service stations, are significant partners, and perhaps therefore local branding is so testosterone-rich: Pure meat without tablecloths. In Sweden Sibylla has a full spectrum of outlets from large fast-food restaurants to tiny kiosks.
Sibylla is run by local franchise entrepreneurs
together with Atria Concept, whose turnover is some €50 million, not really much. However, during the current intense expansion
phase, they may be hoping to even double the turnover every few years. They have already done it formerly. From the year 2006 to the year 2009, according
to DI, turnover increased by 163%.
One cannot know whether Sibylla’s international breakthrough is coming but
at least, in contrast to Atria Russia’s primary production, they are striving
forward.
We will dig into these issues later, but on Friday, September 14th, we
will take a quick look at HKScan Plc. By then autumn has come, but the following season will
be summer. (If winter and spring are not
taken into account.)
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