Summer’s gone - Just superficially about Atria Plc and HKScan Plc in Tarzan-English will continue

Atria believes in growth in Russia (but now there was growth in Finland)

Jarmo Lindholm, Executive Vice President Atria Russia, has told Russian media (see for instance advis.ru, interfax-russia.ru and formens.org) about what are the company's future preferences and plans. He has stated, among several other things, that Atria Russia aims to EUR 135 million sales already this year. He has also announced that the company will launch Ridderheims brand now also in Russia. This launch is just what we anticipated earlier this year. But achieving annual turnover of EUR 135 million this year is not an easy task.  Current H1 sales figure is just under EUR 60 million, roughly the same as last year, when the annual turnover was slightly more than EUR 125 million.

 

Atria’s Pit-Product is the clear market leader in St. Petersburg, but of course there are also rivals.  One of them is Kronstadt Meat Processing Plant, which according to vedomosti.ru will seriously try to challenge Pit-Product in the consumer market.  It already has a strong position among the public sector catering, the company's website tells. 

Anyway, there seems to be a bright feel in Atria Russia.  Just like on this video from the sunny River Neva, where Atria Russia’s corporate event has taken place last year. Juha Gröhn, CEO Atria Plc, seems to have been there too, giving a talk.

 

Absolutely, Atria Russia interests many these days, but in fact, Atria Finland may just now be even more interesting to follow.

Quite unexpectedly, Atria Finland’s net sales, compared to the same period last year, jumped about EUR 30 million, that is as much as about 15%.  What’s important, it was not a spike in export but according to Atria’s Interim Report Q2/2013, growth in Finland came from retail and catering.

 “Net sales and market share strengthened significantly during the period under review in both retail trade and the Food Service market.”

Now it is really a must to look at what the biggest competitor HKScan says about its Q2 sales in Finland.  It begins like this:

“Net sales fell short of the previous year, mainly because of the planned lower level of campaign and seasonal activities.”

 It ends like this:

“Overall price competition in the domestic market remained high.”

Thus, it appears that Atria's closest competitor’s tactic has failed and the company has ruined its own turnover in Finland thoroughly. One might argue that Atria’s success in Finland was due to HKScan’s bad situational awareness.

 

Atria Finland’s and HKScan Finland’s Q2 sales (EUR million) by year.

HKScan has been adjusting its 2012 figures.  The company gives this explanation: “The 2012 figures have been restated in accordance with the changed reporting principle for marketing support expenses.” 
 New adjusted figures are used here.

Indeed it must be said that price competition during the high season does not feel appropriate. However, Atria Finland’s Q2 EBIT of EUR 7,4 million is decent, while HKScan Finland's  corresponding EBIT of  EUR 0,5 million is an awfully weak result. Extremely important Q3 is now of particular interest. Has the closest competitor changed its tactics?  If not, then Atria Finland will win again.

We will discuss Atria later but on Friday, September 13^th, we are going to look at HKScan’s businesses.  Life is nice, clear blue skies. (Homemade poetry. My new hobby. Pardon me.)

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