Paulig Group investigates preconditions for consolidating Group’s tex-mex chips production
Paulig Group has carried out a pre-study of the overall tex-mex chips production capacity within the group. Based on this Santa Maria AB, a division within Paulig Group, will investigate the preconditions for a possible relocation of the tex-mex chips production from Mölndal, Sweden, to Roeselare, Belgium. Union negotiations will begin in Sweden March 11.
Santa Maria’s taco factory in Mölndal produces more than 5,000 tonnes of tacos, chips and taco shells annually. Continued tex-mex chips production in Mölndal would require significant investments in the machinery and the facility in the coming years. The Mölndal plant currently employs a staff of 81 in three shifts.
“The employees are doing a great job, and the efficiency of the factory has improved steadily in recent years. However, we have been considering alternative solutions for a few years now as we will have to invest in both machinery as well as the factory property in the future. So far we haven’t found any economically viable solutions. As there is free capacity in this segment within Paulig Group, we need to investigate this possibility,” says Johan Sundelin, Managing Director of Santa Maria AB and Head of World Foods & Flavouring division of Paulig Group.
The negotiations will concern the preconditions for a possible transfer of the tex-mex chips production to Paulig Group’s Snack Food division’s factory in Roeselare, Belgium. The Roeselare plant produces approximately 40,000 tonnes of chips and tacos per year, and there is currently capacity for the production of also the Santa Maria tex-mex chips products without the need for significant new investments. The Snack Food division currently employs a staff of 400 in Belgium, of which 320 work in production. The plant manufactures chips, tacos, wrap and tortilla products.
Based on this, Santa Maria AB is launching negotiations with union representatives in Sweden on the preconditions for a possible relocation of the tex-mex chips production to Belgium, which would also mean that the staff would be invited to work in Belgium as the production in Mölndal would be discontinued. These negotiations are expected to continue all spring in parallel with the Group’s evaluation process.
“The process is at a very early stage, but it is clear that a possible transfer of the production would affect the employees. This is something that obviously would be subject to union negotiations. I fully understand the uncertainty that employees feel, but we must have respect for the ongoing investigation and negotiation process,” says Johan Sundelin.
Paulig Group’s key sectors today are coffee, spices and food concepts, and snack foods from different parts of the world. The core of the entire business is good taste and quality products. Paulig Group’s strong brands include Santa Maria (spices and food concepts) and Paulig (coffee). Since 1 March, Risenta AB has also been part of Paulig Group.
Paulig was founded by Gustav Paulig in Helsinki, Finland, in 1876. Paulig Group is still family-owned and based in Helsinki. It has business operations in 15 European countries, and its products are sold in more than 40 countries.
Paulig Group began cooperation with Santa Maria in the early 1990s. In 2010, Santa Maria officially became part of Paulig Group.
Paulig Group’s net sales in 2013 were EUR 850 million. The net sales of the World Foods & Flavouring division (Santa Maria) amounted to EUR 301 million, while the Snack Food division’s net sales were EUR 185 million.
Johan Sundelin, MD Santa Maria AB / Head of Division, World Foods & Flavouring
Tel.: +46 70 855 7013
Anita Laxén, Communications Director, Paulig Group
tel. +358 40 7700 873
About the company
Paulig Group is a family-owned international company in the food industry; founded in 1876 and noted for our high-quality products in key sectors Coffee, World Foods & Flavouring, Snack Food and Industrial Flavouring. Our portfolio includes strong brands such as Paulig and Santa Maria. The group has almost 2,000 employees in 15 countries and the net sales for 2013 were 850 million euros.
The World Foods & Flavouring division of Paulig Group has operations in 12 countries and sales in over 30 markets. The division has a staff of 900 and production in Sweden (spice factory, tex-mex chips factory and tortilla factory), Estonia (spice factory) and Great Britain (tortilla factory). Net sales in 2013 were EUR 301 million.
The Snack Food division of Paulig Group has a staff of 400 and production in Roeselare, Belgium. Net sales in 2013 were EUR 185 million.
The acquisition of Risenta is completed
The acquisition of Risenta AB announced by Paulig Group on February 6th, was successfully completed February 27th 2015. With this Risenta is now officially part of Paulig Group’s and the business continues as a separate division within the group.
Paulig Group acquires Risenta
Interest in delicious and healthy food is currently one of the fastest-growing consumer trends. Paulig Group is expanding its business activities into this category by acquiring Risenta AB.
Risenta is an entrepreneurial company with a home market in Sweden. The company, which was established in 1940, specialises in offering delicious and healthy food to people who appreciate a healthy lifestyle. In the last six years, the company's turnover has more than doubled, and the turnover in 2014 was EUR 30 million.
“We are very impressed with the excellent work that Risenta’s owners and employees have done over the years. The company's management realised the potential in the healthy food category early on, which shows a true pioneering spirit that is strongly present in their business operations. We are happy to welcome Risenta to Paulig Group,” says Jaana Tuominen, CEO.
Risenta is the leading producer of healthy staple foods in Sweden, and its turnover has grown rapidly over the last few years. The company’s products are also sold in Finland. More than 30 per cent of Risenta’s total sales consist of products that were launched in 2010-2014.
Paulig Group’s key sectors today are coffee, flavouring and food concepts from different parts of the world. The core of the entire business is good taste and curiosity about new tastes. Paulig Group’s strong brands include Santa Maria (flavourings and food concepts) and Paulig (coffee). The company was founded by Gustav Paulig in Helsinki, Finland, in 1876. Paulig Group is still family-owned and based in Helsinki. It has business operations in 15 European countries, and its products are sold in more than 40 countries.
Risenta’s incorporation into Paulig Group will cause no changes in staff. Risenta's 34 employees will become Paulig Group employees. The Risenta brand will remain on the products. The company’s current managing director and main owner, Alex Tengwall, will continue to lead the business and will report to CEO Jaana Tuominen.
“We actually had no intention of selling Risenta, and it was a tough decision. But when Paulig Group approached us, we realised that this would be a perfect opportunity to further develop the company. It was important for us that Paulig Group is a family-owned business focusing on taste that carries out its business with a long-term approach,” says Alex Tengvall.
The acquisition is expected to take effect on 28 February 2015. The parties have decided not to publish the purchase price.
Jaana Tuominen, CEO, Paulig Group
tel. +358 9 3198 330
Alex Tengvall, Managing Director, Risenta
tel. +46 703 955 483
Anita Laxén, Communications Director, Paulig Group
tel. +358 40 770 0873, anita.laxen(at)paulig.com
At the Paulig Group we are united in the quest of exploring great taste. We are a family-owned international company in the food industry; founded in 1876 and noted for our high-quality products in key sectors: Coffee, World Foods & Flavouring, Snack Food and Industrial Flavouring. Our portfolio includes strong brands such as Paulig and Santa Maria. The Group has almost 2,000 employees in 15 countries and the net sales for 2013 were EUR 850 million. www.pauliggroup.com
Risenta is a Swedish company and a leading producer of healthy staple foods in Sweden. The company provides a large variety of foods, such as seeds, muesli, special flour, cereals, rice, beans, lentils, snack food, bean pasta, dried fruit and nuts. Established in 1940, Risenta is now in its third generation of family ownership. Since 2005, the head office and warehouse have been located in Sollentuna, Stockholm. www.risenta.se
Paulig has the best image of corporate responsibility in Finnish food industry
Paulig was ranked among the best in a reputation and responsibility image survey conducted by TNS Gallup in Finland. The survey measured the overall reputation and the company image as a responsible player in different industries. We shared a second place with Fazer group in the overall reputation. The public opinion regarding our company’s responsible image in the food industry category was a success, as we were considered to be the best in Finland. The survey was conducted for the fifth time this year. In total 57 companies were analyzed in eight different industries. The response rate was high, with over 9000 respondents and 24 000 corporate valuations.
Top 10 in overall reputation:
- Paulig, Fazer
- Snellman, Google
- Valio, RAY
- Helsingin Energia
- S-ryhmä, S-Pankki
Image of responsibility:
Food industry: Paulig
Finance: OP-Pohjola Group
Energy: Helsingin Energia
Therese Adolfsson nominated as Employer Branding Person towards students
The nominees have been published in the magazine Number One, which have been sent home to students together with career magazine Campus. The magazine will also be distributed with "Dagens Industri" in early October. The winner will be presented at Universum Awards March 11, 2015 in Stockholm, Sweden. The winner will be contacted about a month before the awards ceremony.
The jury based on the following criteria:
- the person's interest in and commitment to employer branding issues
- how well the person has contributed to the management team involved in the issues
- that the company communicates its employer brand in an innovative and credible way
- the company's employer branding activities led to results in, among other things Universe measurements
Employer Branding is the strategy companies use to achieve their desired appeal on current and future ideal talent. An employer brand contains a variety of associations and by influencing these associations one can modify the "employer brand".
Universum offer services and products that help employers attract, recruit and retain ideal talent while helping talent learn about ideal employers. Every year Universum performs the Swedish Student Survey "Företagsbarometern" and it is based on responses from thousands of students at colleges and universities around the country. The results of "FöretagsBarometern" reveal how students perceive organisations as employers in Sweden in terms of future career.
Framtidsforetagen.se features listings and details of Sweden's most popular employers. The lists are based on an annual survey conducted by Universum in over 20 different countries with over 400,000 students.
Paulig Group supports the construction of the new children's hospital with 1.5 million euros
Paulig Group has been a part of the Finns’ everyday life for over a hundred years. The company continues on this track with the donation of 1.5 million euros to the construction of the new Children's Hospital 2017. The donation is paid today, June 6, on the Good Coffee Day.
When Children's Castle Hospital was inaugurated in 1948, Paulig participated in the work.
"We are all parts in a collaborative effort that applies not only to ourselves and our company, but also to the whole of modern society with all its many operating procedures," said the then Managing Director of Paulig Eduard Paulig in the years following the war. In those times, reconstruction was at its most feverish and it required the participation of all operators in society.
In the 1940s Mannerheim League for Child Welfare built the Children's Castle Hospital and received a coffee donation from America. Paulig took part in the teamwork to build the hospital by packaging the unroasted coffee in small, 250g Children's Castle Hospital packages. They were used as prizes in draws that were held at the Stockmann department store in 1945. The prize draws were a success, as coffee was still subject to postwar rationing and heavily in demand. It made an excellent draw for various kinds of collections. A considerable sum for that era was raised – 1.2 million Finnish marks.
Building the future is among the main values
"Children and young people are the main target categories for the Paulig Group's social projects. This is why we want to participate in this unique project. The wish to participate in the New Children's Hospital 2017 project came from both the personnel and our owners. People have remembered the story with the Children's Castle Hospital coffee of the 1940s and asked if we could be involved in such an important project again," says CEO Jaana Tuominen.
"It is often said that a family company's quarter is 25 years. Paulig's donation communicates its social commitment and the values that have evolved within the company over generations. The Children's Hospital has awakened the shared sense of belonging among us Finns, and Paulig's donation is a good example of this," says the chair of the New Children's Hospital Support Association 2017, Anne Berner.
The target set for the collection by the New Children's Hospital 2017 project support association is at least 30 million euros. The donations will be used to build a top unit for specialised paediatric care, which will serve its small customers nationwide. Together with the Paulig Group's contribution, the pot now stands at 28.5 million euros.
CEO of Paulig Group Jaana Tuominen (left) and
New Children's Hospital Support Association 2017, Anne Berner
Anita Laxén, VP Communications, Tel: +358 40 770 0873
New Children's Hospital Support Association 2017
Anne Berner, Chairman, Tel. +358 400 468 180
About Paulig Group
Gustav Paulig founded the company in the heart of Helsinki in 1876. The business idea was to offer people tastes from the world. Today Paulig Group is an international family-owned company in the food industry, known for its high-quality brand products. The business areas are Coffee, World Foods & Flavouring, Snack Food and Industrial Flavouring. The strong brands of the Paulig Group include Paulig and Santa Maria. The Group has almost 2,000 employees in fifteen different countries and net sales were EUR 850 million in 2013.
Paulig to acquire Robert Paulig coffee roastery and coffee brands
Among the coffee-lovers of the world, small batches of speciality coffee have become a distinct trend in the coffee business over the past few years. Paulig will expand its offering also into this segment with the acquisition by Gustav Paulig Ltd of the Robert Paulig small roastery's business operations and the Robert Paulig coffee brands.
Robert Paulig started a small coffee roastery in the Katajanokka district of Helsinki in 1987. Today the roastery operates in Tolkkinen, Porvoo, where it moved into new premises in 2011. The roastery will continue to operate in the same premises after the transaction.
"We Finns are lovers of good coffee and we drink coffee in various circumstances. We will now be able to harness both companies' strengths, and by joining our forces we will have even better opportunities to develop the right kind of coffee for different consumption situations and needs," says Elisa Markula, Head of the Paulig Group’s Coffee Division.
The roastery's operations will continue in a separate company
With the transaction, the Robert Paulig roastery will be transferred to a subsidiary of Gustav Paulig Ltd to be named Oy Robert Paulig Roastery Ab.
"We want to retain the small roastery's special characteristics also in the future which is why the roastery’s operations will continue in a separate company," Elisa declares.
The current Director of the roastery, Carl-Gustav Paulig, will continue to be in charge of sales.
The Robert Paulig brand will complement Paulig's brand portfolio
"People often see the Robert Paulig brands as part of the Paulig brand portfolio, and we think it is great that all Paulig brands are now gathered together under the same roof," Elisa Markula comments.
The Robert Paulig coffee brands also include flavoured special blends, Muumi (Moomin) blends and Watsa coffees. The products will continue to bear the Robert Paulig brand in the future.
The intention is for the transaction to take effect on 31 May 2014. The deal will have no effect on personnel. The parties have agreed that the purchase price will not be made public.
The Robert’s Coffee café business is not included in the deal.
Elisa Markula, Head of the Paulig Group’s Coffee Division,
Tel: +358 50 596 0978, elisa.markula(at)paulig.com
Anita Laxén, VP, Communications, Paulig Group
Tel: +358 40 770 0873, anita.laxen(at)paulig.com
Paulig Group is an international family business in the food industry, known for its high-quality brand products. The business areas are Coffee, World Foods & Flavourings, Snack Food and Industrial Flavourings. The strong brands of the Paulig Group include Paulig and Santa Maria. The Group has almost 2,000 employees in fifteen different countries and net sales were EUR 850 million in 2013.
PauligGroup’s Coffee division is the market leader in Finland and the Baltic countries and in Russia it is the second-biggest supplier of roasted coffee. Paulig supplies its products and services to the retail trade, the HoReCa sector and workplaces through the Paulig Professional business unit. In Finland, Paulig's best-known brand products include Juhla Mokka, Presidentti, Paulig Brazil and Paulig Mundo as well as the coffee beverage Paulig Frezza and the drinking chocolate beverage Paulig Tazza. The most popular products on the Russian and Baltic markets are the Presidentti and Paulig Classic coffees and Paulig espresso products. The company's coffee roasteries are located in the Vuosaari district of Helsinki and Tver, Russia. The Vuosaari roastery produces some 100 million packages of coffee or roughly 45 million kilos of coffee per year.
Mikael Aru elected Chairman of Paulig Ltd
The Annual General Meeting elected Mikael Aru as the new Chairman of the Board of Directors of Paulig Ltd on 24 April 2014. Aru has been a member of the Board since 2013. He succeeds Philip Aminoff, who announced that after 17 years on the Board, three of which as the Chairman, he will resign from the Board.
Mikael Aru has gained extensive experience of the food industry at companies such as Procordia (President and CEO 2003–2013), whose brand portfolio includes e.g. Felix, Ekströms, Grandiosa and Risifrutti.
Before Procordia, he was CEO of Kraft Foods Norway and Executive Vice President of Kraft Foods Nordic’s confectionery and food businesses. He has also held senior management positions at Kraft Jacobs Suchard Europe and the Nestlé Group. He is currently a Board member of several companies and Senior Advisor for Orkla ASA.
Mikael Aru was born in 1953 and has a degree in business administration from the University of Linköping. He lives in Sweden.
The General Meeting also elected Jon Sundén (b. 1971) as a new member of the Board. He is the Managing Director of Oy Telpak Ab, a packing materials wholesaler. He also has many years of extensive experience in leading and developing the supply chain gained at among others Fazer.
The other Board members were re-elected by the Annual General Meeting and are: Mathias Bergman, Christian Hallberg, Eero Heliövaara, Christian Köhler and Sanna Suvanto-Harsaae. Berndt Heikel will continue as the secretary of the Board of Directors.
VP, Communications, Paulig Group, Anita Laxén: +358 40 770 0873
The Paulig Group's operating profit grew in 2013
The Paulig Group had a good year in 2013 and all four divisions of the Group attained or exceeded the targets set for operating result. Net sales were EUR 849.7 million and operating profit rose to EUR 75.9 million.
The Paulig Group's results were good in spite of challenging market conditions. The Group's net sales declined by 1.0 per cent on the previous year to EUR 849.7 million. The Group's sales volume grew by more than 5 per cent during the year. The decrease in net sales was mainly due to lower world market prices for coffee in 2013 compared with the previous year. Since the beginning of 2014, the drought in Brazil has raised the price of green coffee once again.
The Group's operating profit rose to EUR 75.9 million (70.0) and operating profit relative to net sales to 8.9 per cent (8.1).
"I am very pleased with last year's results and with our systematic work to enhance our core business with coffee, flavourings and world food concepts. Strong values, consumer insight and capable personnel are behind the success," says CEO Jaana Tuominen.
2013 in brief
- Net sales were EUR 849.7 million (858.3)
- Operating profit was EUR 75.9 million (70.0). Operating profit's share of net sales was 8.9 per cent (8.1)
- Return on equity (ROE) 10.4 per cent (9.2)
- Net debt fell to EUR 12.6 million (96.6)
- Equity ratio was 69.8 per cent (57.8)
- The number of personnel at year-end was 1,881 (1,846)
The Paulig Group's Coffee division took a particularly satisfactory track during the year. The division's net sales were EUR 322.6 million (343.6). The downturn in net sales was mainly due to lower world market prices for coffee. The sales volume developed well and in Finland both the Juhla Mokka and the Presidentti brands grew relative to the previous year. In Russia and its nearby markets, sales volume grew by more than 20 per cent and in the Baltic countries by 18 per cent. Out-of-home coffee consumption is growing steadily and this business sector is an increasingly important part of the Coffee Division's commercial operations. Gustav Paulig Ltd and Oy Vendor Group Ab merged at the turn of the year 2014, and at the same time the Coffee Division established a new business unit, Paulig Professional.
”Paulig Professional provides a comprehensive service package embracing coffee and equipment as well as services and maintenance for out-of-home customers in Finland, the Baltic countries, Sweden and Norway," Jaana Tuominen reports.
The World Food & Flavouring Division developed in line with the targets and the business sector's internationalisation continued. The division's net sales were EUR 301.0 million. Systematic groundwork done in the course of 2013 made it possible to launch the Santa Maria brand in the UK at the beginning of this year. The range of the world's fourth-largest retail chain Tesco now includes a broad selection of Santa Maria spices and tex-mex products.
"We are very enthusiastic about this opening for the Santa Maria brand as it makes growth possible for us in a very challenging market," Jaana Tuominen notes.
The World Food & Flavouring Division already has the local Discovery brand in the UK, concentrating exclusively on tex-mex products.
The Group's two other divisions, Snack Food and Industrial Flavouring, also achieved their business targets in 2013. The Snack Food Division's net sales were EUR 185.2 million (177.7) and the Industrial Flavouring Division's net sales were EUR 53.2 million (51.8).
Taste is crucial
The aim of the Paulig Group is to be close to the consumer and to provide the kind of products and concepts that people enjoy and appreciate. The ability to transform trends plus knowledge of the market and consumers into successful products and services is important.
"As a food company, taste for us is crucial and the core of the business. Providing the best flavours will be at the heart of our operations in the future as well. This thought guides what we do for all new plans, whether they are new products, concepts, services or acquisitions," Jaana Tuominen points out.
CEO Jaana Tuominen, Tel. +358 9 319 8330
Requests for interviews:
VP, Communications Anita Laxén, Tel. +358 40 770 0873
About Paulig Group
At the Paulig Group we are united in the quest of exploring great taste. We are a family-owned international company in the food industry; founded in 1876 and noted for our high-quality products in key sectors Coffee, World Foods & Flavouring, Snack Food and Industrial Flavouring. Our portfolio includes strong brands such as Paulig and Santa Maria. The group has almost 2,000 employees in 15 countries and the net sales for 2013 were 850 million euros.
Drought in Brazil has raised drastically green coffee prices
Green coffee prices rocketed in the New York Stock Exchange between end of January and mid-March. Price increase for one kilo of green coffee was nearly 1.5 euros. Price has stayed on the same level. Price increase during a quarter is biggest since the Brazilian frost summer 1997. High green coffee prices will also affect consumer prices.
The price of Arabica coffee was in the end of January 120UScent/lb (2€/kg) and in mid-March already 210 UScent/lb (3.40 €/kg) and is now about 190 UScent/Lb. Sourcing Director Katariina Aho, Paulig Group Coffee Division, says the price increase is a consequence of severe drought in Brazil’s coffee cultivation areas. There are fears that it will reduce coffee crop, which is just ripening. ”There is a lot of uncertainty in the market. This severe drought has not been seen before in this stage of crop year. Part of the harvest is already destroyed, but the final truth turns out in May when the harvest starts. Just then we see how the drought has affected coffee quality and amount.”
This drought in Brazil may have long term effects to the harvests and prices in coming years, if coffee stocks decrease and coffee trees suffer. Brazil counts a lot to availability of coffee as world’s leading producer country. Its share of the world’s coffee production has during the last years been approximately 40 %. ”The other coffee producing countries in South and Central America won’t ease the situation very much. In Central America coffee rust -disease has destroyed plantations, but fortunately the recovered coffee production in Colombia can replace these losses”, Aho says.
There are also other threats affecting to price. Currently, El Niño –phenomenon is strengthening and some coffee countries are suffering from heavy rains and storms, some from severe aridity. Investors and funds are interested in coffee and they are expecting to gain good profit.
However, Katariina Aho accents that in order for the coffee farming to maintain as interesting business in the future, the profit assuring price level is very essential. ”At the end of last year the price level diminished onto too low level, even to 100 dollar cent per pound. This led to situation in which some of the farmers gave up using fertilizers and the effects can been seen already now.”
Background information on coffee:
- Aridity is throttling the development of both coffee berries and its seeds, i.e. coffee beans. They remain little, are likely to dry in the coffee bushes or drop too early, affecting to quality.
- There are about 25 billion coffee farmers worldwide.
- Coffee is traded on major futures and commodity exchanges, most importantly in New York (arabica coffees) and London (robusta coffees).
- Most coffees are blended from various origin coffee qualities, that each have their own special character. Each Paulig coffee variety has its own, carefully considered taste profile for the consumer who appreciates different flavours.
- Thanks to blending, the characteristics of various coffee brands remain the same from package to package and from year to year despite the fact that the characteristics of coffee, as natural produce, are affected among other things by the weather conditions and growing place.
Paulig Coffee Division, Sourcing Director Katariina Aho, tel +358 9 3198 234 or mobile +358 40 702 4220