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 27^th, 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 31^st 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 14^th, 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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