Wiesenhof increases turnover by 14.9 percent
PHW Group grows by 5.5 percent to 1.14 billion euros / investment totalling 52.5 million euros / quality system extended / TAD Pharma aims to expand foreign business.
Rechterfeld/Hamburg, 19 February 2004. The PHW Group (Rechterfeld) continues to grow: in the 2002/2003 ﬁnancial year ended (30.06.), the company increased total consolidated turnover, adjusted for internal sales, to 1.14 billion euros (previous year: 1.08 billion euros), representing growth of 5.5 percent or 59 million euros. This growth can primarily be traced back to the pleasing development of “Wiesenhof”, the leading German poultry brand. At 695 million euros in the ﬁnancial year ended (previous year: 605 million euros), an increase in turnover of 14.9 percent was achieved. With a sales volume of 59.7 million euros, the Human Nutrition and Healthcare division remained at the same level as the previous year (2001/2002 ﬁ nancial year: 60.7 million euros). The Animal Nutrition and Animal Health division reported a decline in sales of 7 percent to 304.7 million euros. The remaining turnover of the PHW Group is accounted for by the Breeding and Rearing division (sales increase of 2.3 percent to 45 million euros), upstream of the “Wiesenhof” brand, and the Polish poultry processor Drobimex GmbH in Stettin (37.3 million euros) which is owned to around 94 percent by the PHW Group. The number of employees remained stable in 2002/2003, so that today 3,855 employees work in the PHW Group (previous year: 3,866). Alongside PaulHeinz Wesjohann, the management of the PHW Group includes his son Peter Wesjohann as well as Harm Specht.
Wiesenhof: Quality concept further expanded
In the ﬁnancial year ended, “Wiesenhof” reaped above average gains from the continuing high demand for poultry meat. Per capita consumption in Germany rose from 17.5 kg to 17.9 kg. At the same time, the brand proﬁ ted from the trust consumers place in its origin, quality and safety concept. This concept is implemented in conjunction with about 700 partner farms or producer associations and involves a production process according to the single source principle. This means that all production stages take place in Germany, since 1996 feed from our own feed mills is guaranteed not to contain animal proteins and since 1997 this guarantee has been extended to include the exclusion of antibiotic performance enhancers as well. The farms which rear the birds are named on the origin labels. As the only European provider to do so, “Wiesenhof” additionally provides proof that the feed from its own mills does not contain any genetically manipulated soya and is also produced free of salmonella. All the poultry slaughterhouses and processing plants belonging to the Group are certiﬁ ed to ecological and quality assurance standards.
Last autumn, “Wiesenhof” extended the origin, quality and safety concept by another component: residue monitoring. The inspection of poultry and feed by internal and external laboratories forms an integral part of the sophisticated quality and origin concept. Since October 2003, the results of all residue controls for poultry and feed have been made available to all trade customers. With this disclosure, “Wiesenhof” takes on a pioneering role within the entire food industry.
Industry: Continued strong import pressure from third countries
Investment in a cast-iron safety system and in the “Wiesenhof” brand has been undertaken in the face of dramatic changes and abrupt developments in the poultry market. The ongoing high import pressure from third countries, such as Thailand and Brazil, resulted in falling market prices in the year under review. At the same time, crises such as avian inﬂ uenza in the Netherlands in early 2003 resulted in short-term production increases in Germany.
The medium and long-term trend for poultry meat offers good growth opportunities for the brand. In the Central and Eastern European accession and candidate countries, demand for poultry meat will grow in the next few years. The signiﬁ cant inﬂuencing factors are the growth in income since the mid-nineties and the effects associated with this growth such as the increased tendency to eat out, the demand for convenience products and the change in price relationships. With its investment in Poland – besides its existing shareholding in the poultry processor Drobimex in Stettin, the PHW Group also has a 50 percent share in the turkey processing plant Bomadek in Trzebiechow near Posen – the PHW Group has set the basis for further growth in Eastern Europe.
PHW Group sets up a European household in the medium-term
In the medium-term, Paul-Heinz Wesjohann sees the entire German poultry industry, including the PHW Group, on its way to setting up a “European household”. In order to retain its competitive edge and to comply with European trade structures, the company is currently working on cross-national solutions which take into account the highest quality requirements. Mr. Wesjohann explains: “We could imagine implementing the process quality in production and marketing formulated for Wiesenhof internationally. This is why an accepted European quality mark should be set up in the long-term.” According to Mr. Wesjohann, the poultry industry is better prepared for such European internationalisation than other industry sectors because it has never received government subsidies.
Investment in expansion and additional environmental protection measures
Having invested 90 million euros in the 2001/2002 ﬁnancial year, investments made by the PHW Group in the ﬁnancial year ended remained at the previous year’s level. Of the overall investment amounting to 52.2 million euros, the largest share (22.1 million euros) went into the production plants of the “Wiesenhof” brand, including the extension of the poultry slaughter house in Bogen (6.3 million euros) and the expansion of the production, order picking and loading capacities of the “Märkische Geﬂügelspezialitäten” in Eastern Germany’s Niederlehme (2.4 million euros). Investment at Lohmann Animal Health (LAH) amounted to 8.7 million euros due to the expansion of the vaccine plant. Expenditure in research and development increased once again. In the ﬁnancial year ended it amounted to 9.4 million euros (previous year: 7.4 million euros), of which just under 5 million euros alone was spent on the development and approval of new medicines at TAD Pharma.
Last year, the PHW Group again invested in environmental measures. Together with a local operator, the company built a biogas plant for 1.3 million euros on the premises of Wiesenhof Möckern (Saxony-Anhalt). The plant generates energy from the organic waste from the poultry slaughterhouse which is then fed into the local network. The municipality of Möckern has been proﬁ ting from Wiesenhof ever since 1996 as local waste water is puriﬁ ed via the Wiesenhof treatment plant at low cost.
Generic drug producer TAD Pharma aims to expand foreign business in 2004
The generic drug producer TAD Pharma (Cuxhaven), which belongs to the PHW division of Human Nutrition and Healthcare, achieved sales of 43 million euros in the ﬁnancial year ended with a staff of 237, and expects continued growth in the current ﬁnancial year. The Cuxhaven-based company intends to extend its export activities and expand its top position in the generic drug segment through more extensive cooperation with foreign partners. For several years now, TAD Pharma has been working together on product development with various companies, including the Icelandic pharmaceutical company Delta (Hafnarfjördur).
Nutrilo GmbH, specialising in the production of vitamin mixes for the food industry, increased sales in the year under review by 23.3 percent to 16.4 million euros (previous year: 13.3 million euros). This marked growth in sales was primarily achieved in its domestic business (up 37 percent).
Outlook: PHW Group expects moderate growth
With regard to the Wiesenhof brand, the PHW Group intends to maintain a consistent quality policy and will not be entering into any price wars. The marketing investments planned at Wiesenhof for the next ﬁ ve years are in the two-digit million region and aim to further consolidate the brand and quality philosophy in the trade world and in the minds of consumers. All in all, the PHW Group expects total investment in the current ﬁ nancial year at the same level as in 2002/2003 and moderate growth.
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