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Animal feed giant Nutreco incurs significant losses

May 1, 2024 - Wouter Baan

The Dutch animal feed giant Nutreco, which has spread its wings globally through its subsidiaries Trouw Nutrition and Skretting, is clearly going through a rough patch. The company - owned by the Fentener van Vlissingen family through SHV - had to incur a significant loss of tens of millions of euros in 2023. This was also the case in 2022.

In short:

  • For two consecutive years, Nutreco has reported losses of tens of millions of euros
  • CEO Fulco van Lede recently announced his unexpected departure 
  • According to their own statement, market conditions were less challenging last year compared to 2022
  • From a turnover of over €8.5 billion, the bottom line shows a loss of €75.4 million, as revealed by data filed with the Chamber of Commerce at the end of last month. This represents a deterioration compared to 2022 when the total loss was €63.4 million. The worsening of the results is attributed to higher interest expenses and unfavorable exchange rates. Additionally, the company mentions that higher labor costs are impacting the results. In 2021, a modest profit was recorded after revenues exceeded €100 the year before. The only conclusion that can be drawn is that Nutreco's results are on a downward trend.

    CEO Departure
    This may help explain the unexpected departure of CEO Fulco van Lede. He announced his departure in early April for personal reasons after working his way up through various positions and leading the company for three years. It is also noteworthy that Nutreco did not make any acquisitions in 2023, unlike in previous years. The solvency of 22% is at the lower end of the acceptable range.

    Looking at the figures, it seems that the upward trend has resumed. In 2023, the operating profit showed an increase, as did the cash flow. Nutreco also achieved a few percentage points of volume growth in both livestock and fish feed, despite a decrease in demand due to African swine fever and avian influenza. Nutreco itself also states that market conditions were less challenging than in 2022 when many commodity markets went haywire.

    Leading Position
    Nutreco emphasizes that cost reduction is and will remain a priority. Significant gains can be made, especially in the logistics chain. The company states in its annual report that it continues to strive for leading positions in the markets it operates in, mainly animal and fish feed. Nutreco also invested in cultured meat a few years ago in collaboration with Mosa Meat.

    Wouter Baan

    Wouter Baan is the editor-in-chief of Farmerbusiness and a market specialist in dairy, pork, and meat at DCA Market Intelligence. He also tracks developments within the agribusiness sector and conducts interviews with CEOs and policymakers.
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