Bell Food Group, first half of 2020
Broadly supported business model and high productive capacity ensure a good operating result
Financial analysts' presentation
13.08.2020 | Bell Food Group, first half of 2020
Overview of first half of 2020.
13.08.2020 | Bell Food Group, first half of 2020 | Seite 2 |
Key facts at a glance and important events
Results for first half of 2020
Sales revenue | Half-year profit |
in CHF million | in CHF million |
1,995 | 34.9 |
+ 2.9 % adjusted* | Previous year reported |
- 9.6 |
Number of | EBIT |
employees | in CHF million |
FTEs as at 30.06 |
12,141 | 59.4 |
- 3.1 % | + 2.4 % |
65 locations in 15 countries
*Adjusted for currency effects and acquisitions/divestments
13.08.2020 | Bell Food Group, first half of 2020 | Seite 3 |
Key facts at a glance and important events
Operating growth in first half of 2020
- Broadly supported business model and high productive capacity ensured attractive operating
sales growth | Operating sales growth |
- In Switzerland, large increases in meat and charcuterie retail sales made up for the sharp decline in food service sales; changes to the product range/channel mix had a positive effect
- Excellent performance by Bell International: concentration of international business on air- dried ham and poultry had a positive effect on earnings
- Development of the Convenience business area was curbed by the coronavirus pandemic; decline in sales and profit could not be prevented
13.08.2020 | Bell Food Group, first half of 2020
Key facts at a glance and important events
Coronavirus pandemic - effects on markets
- Effects of the pandemic on work processes
- Implementation of protective measures such as social distancing, remote working, travel restrictions and meetings generated additional expenses
- Restrictions to travelling/border crossings complicated the commute to work for employees
- Multi-weeklockdown and restricted mobility had a severe impact on consumers' shopping and eating habits
- Substantially increased consumption by private households as consumers prepared more meals at home
- Strong decline in demand for to-go products and meals to eat at the office
- Closure of many catering establishments led to the collapse of the food service market during lockdown
- In Switzerland, retailers benefited from the complete standstill of shopping tourism
13.08.2020 | Bell Food Group, first half of 2020 | Seite 5 |
Key facts at a glance and important events
Coronavirus pandemic - significant changes in demand, depending on product group
Development of retail product groups in Switzerland
+/- in %
60
50
40
30
20
10
0
-10
Meat / charcuterie Non-perishable convenience Fresh convenience
Bread / baked goods Fruit / vegetables Sweets / snacks
January | February | March | April | May | June |
13.08.2020 | Bell Food Group, first half of 2020 | Seite 6 |
Key facts at a glance and important events
Coronavirus pandemic - great distortions in the retail and food service markets
Index of retail and food service markets
Retail | ||||||
Food service | ||||||
130 | ||||||
120 | ||||||
110 | ||||||
Index | 100 | |||||
90 | ||||||
80 | ||||||
70 | ||||||
60 | ||||||
50 | ||||||
January | February | March | April | May | June |
13.08.2020 | Bell Food Group, first half of 2020 | Seite 7 |
Key facts at a glance and important events
Coronavirus pandemic - effective reaction by the Bell Food Group
- Timely and efficient implementation of protective measures - the health of employees has the highest priority
- Consistent implementation of protective measures such as social distancing has prevented the spread of the virus in facilities to date
- Additional relief and benefits for employees in recognition of their great commitment
- Production and delivery readiness could be guaranteed at all times - delivery and supply mandate fulfilled
- Strong fluctuations in order volumes mastered thanks to the high productive capacity and great commitment of employees
- Product ranges adjusted to market needs at short notice; e.g. limited to one core product range
- Retail market posts substantial increase in all product groups except fresh convenience
- Slump in food service sales compensated by meat and charcuterie thanks to guaranteed delivery readiness at all times
- Cost levels immediately adjusted to new sales conditions
13.08.2020 | Bell Food Group, first half of 2020
Strategic directions.
13.08.2020 | Bell Food Group, first half of 2020 | Seite 9 |
Update on strategic directions
Systematic implementation of the Group strategy
1
• Construction of a new deep-freeze store | |
Strengthening of | started; state-of-the-art store in Oensingen |
to be finished by the beginning of 2023 | |
the leading | |
position in the | • It will allow the concentration of current |
traditional meat, | internal and external storage facilities in a |
poultry, seafood | single location while substantially |
and charcuterie | expanding productive capacity and halving |
segment | resource requirements |
Seite 10
Update on strategic directions
Systematic implementation of the Group strategy
1
• Internationally, focus on segments with | |
Strengthening of | intact perspectives that can achieve critical |
mass | |
the leading | |
position in the | • Clear focus on air-dried ham specialities |
traditional meat, | and poultry |
poultry, seafood | • In this context, two production locations in |
and charcuterie | |
Hungary and France and the logistics | |
segment | |
centre in Belgium were sold | |
Seite 11
Update on strategic directions
Systematic implementation of the Group strategy
1
Strengthening of
the leading position in the traditional meat, poultry, seafood and charcuterie segment
- Bell Food Group is to increase its investment in the Dutch start-up Mosa Meat, which is the world's leading company for cultured beef with some 40 employees
- Mosa Meat wants to be the first to launch a cultured meat product on the European market
- Bell Food Group highlights its commitment to sustainability and publishes a complete Sustainability Report in accordance with the GRI standard for the first time
www.bellfoodgroup.com
Seite 12
Update on strategic directions
Systematic implementation of the Group strategy
2
Expansion of our market share in the high-growthand high-margin convenience
- Successful launch of "The Green Mountain" plant-based burger in the Swiss retail channel further expanded our leading position in vegetarian and vegan products in Switzerland
market | • Further expansion of vegetarian |
ranges is ongoing |
Seite 13
Update on strategic directions
Systematic implementation of the Group strategy
2
• Expansion and modernisation of the | |
Expansion of our | production infrastructure |
progressed further - construction of | |
market share in the | |
the new Hilcona building in Schaan | |
high-growth and | |
on schedule | |
high-margin | |
convenience | • Various innovations to further |
market | enhance the attractiveness of the |
product range and gain market share | |
• Growth momentum curbed by the | |
coronavirus pandemic, but fresh | |
convenience and to-go segments | |
remain medium- and long-term | |
drivers of the convenience business |
Seite 14
Update on strategic directions
Systematic implementation of the Group strategy
3
• Strengthening of the food service | |
Substantial | channel with tailored "Smart Cuisine" |
product and concept solutions | |
strengthening of | |
• From the end of June 2020, a path- | |
the food service | |
channel | breaking cooperation with the |
University Hospital of Basel (UHB) for | |
the marketing of nutritional solutions | |
based on the promising MicroPast | |
technology for hospitals and frail care | |
centres | |
• UHB is a pioneer in this field and | |
boasts a wealth of expertise in the | |
challenging nutritional aspects of frail | |
care nursing | |
• Hilcona division will in future market | |
menus produced by UHB and will thus | |
considerably expand its service | |
portfolio for this growing segment |
Seite 15
Update on strategic directions
Systematic implementation of the Group strategy
4
Expansion of geographic presence
- Foray into the DACH region with fresh convenience thanks to new production capacities
- Restructured export organisation made further progress; exports to China and other world regions picked up speed
Sites Convenience DACH-Länder (CH/DE/AT)
Seite 16
Comments about financial reporting.
13.08.2020 | Bell Food Group, first half of 2020 | Seite 17 |
Details and explanations for first half
Sales development
Sales revenue | Breakdown of sales by product group | |||||||||
in CHF million | in % | |||||||||
17 | 18 | |||||||||
25 | 27 | 26 | ||||||||
2,061 | 2,023 | 1,995 | Convenience | |||||||
1,734 | 25 | 27 | ||||||||
1,616 | ||||||||||
809 | 700 | International | 25 | |||||||
767 | 25 | 27 | ||||||||
552 | Poultry, | |||||||||
473 | seafood | |||||||||
1,252 | 1,256 | 11,295 | 58 | 55 | ||||||||||
1,182 | Switzerland | 50 | 48 | Fresh meat, | ||||||||||
1,143 | 47 | |||||||||||||
charcuterie | ||||||||||||||
HY2016 | HY2017 | HY2018 | HY2019 | HY2020 | HY2016 | HY2017 | HY2018 | HY2019 | HY2020 |
13.08.2020 | Bell Food Group, first half of 2020 | Seite 18 |
Details and explanations for first half
Influences on sales
Sales revenue
in CHF million
First half of 2019
Currency effect
Acquisition/divestment
First half of 2019 adjusted
Bell Switzerland BA
Bell International BA
Convenience BA
First half of 2020
2,023
- 45
- 42
1,936
+ 38
+ 42
- 20
1,995
Operating growth + CHF 59 million
- Organic sales growth of 2.9 %
- Encouraging performance by Bell International; revenue lost through the sale of the German sausage business in 2019 could be compensated
- Coronavirus fallout burdens the development of Convenience sales
13.08.2020 | Bell Food Group, first half of 2020 | Seite 19 |
Details and explanations for first half
Development of gross profit and EBIT
Gross operating profit
in CHF million and in % of net income
36.7% 37.5% 38.2% 38.7% 38.8%
EBIT
in CHF million and in % of net income
3.8% | 3.8% | 2.7% | 3.0% |
0.6% | |||
585
772 768 761
642
61 | 65 | 59 |
55 | ||
11
HY2016 HY2017 HY2018 HY2019 HY2020
HY2016 HY2017 HY2018 HY2019 HY2020
13.08.2020 | Bell Food Group, first half of 2020 | Seite 20 |
Details and explanations for first half
Operational progress
EBIT
in CHF million
First half of 2019 reported
Reorganisation of Bell Germany
Once-off expenses and costs of idleness
Raw material prices
Start-up costs
1st HY 2019 adjusted
Organic growth 1st HY 2020
First half of 2020
11.0
- 37.0
- 6.0
- 4.0
58.0
+ 1.4
59.4
- Encouraging organic EBIT growth of 2.4 %
- Positive development of the retail channel compensated for the decline in food service
- Additional cost measures implemented
13.08.2020 | Bell Food Group, first half of 2020 | Seite 21 |
Details and explanations for first half
Reconciliation of half-year profit
2019 | 2020 | ||||
reported | adjusted | reported | |||
EBIT | 11.0 | 58.0 | 59.4 | ||
Result from associates | 1.1 | 1.1 | 1.0 | ||
Financial result | -7.5 | -7.5 | -9.9 | ||
of which foreign currency losses | -2.8 | -2.8 | -5.7 | ||
of which other financial result | -4.6 | -4.6 | -4.2 | ||
Taxes | -14.3 | -12.3 | -15.6 | ||
Third-party interest in profit | 0.1 | 0.1 | 0.0 | ||
Half-year result | -9.6 | 39.4 | 34.9 |
- Financial result down on the prior year due to higher foreign currency losses
- Improved earnings lead to higher tax expenses
- Prior year impacted negatively by the tax reform in Switzerland
13.08.2020 | Bell Food Group, first half of 2020 | Seite 22 |
Details and explanations for first half
Balance sheet and cash flow for first half of 2020
Cash and cash | Net financial |
equivalents | liabilities |
in CHF million | in CHF million |
143 724
Share of total assets 5.4 %
Operating cash flow | Investments in |
in CHF million | property, plant and |
equipment/software | |
in CHF million |
86 | 82 |
-11.9 % |
Equity
in CHF million
1,273
Share of total assets 48.5 %
- No material changes to the balance sheet compared to the end of 2019
- Focus on securing the liquidity situation for all Group companies
- Very steady equity ratio of 48.5 % and stable net financial liabilities
- Bell Food Group has a very solid financial foundation and is ready for the future
13.08.2020 | Bell Food Group, first half of 2020 | Seite 23 |
Details and explanations for first half
Investments
Capex for property, plant and equipment/software
93 | 82 | |
New construction projects | 48 | 39 |
Investments in modernisation | 45 | 43 |
and replacements | ||
HY 2019 | HY 2020 |
- Curtailment of investments due to the coronavirus where this is possible without negative fallout
- Expected capex in property, plant and equipment for 2020 in the lower range of the announced bandwidth of CHF 200 to 250 million
13.08.2020 | Bell Food Group, first half of 2020 | Seite 24 |
Performance of business areas.
13.08.2020 | Bell Food Group, first half of 2020 | Seite 25 |
Performance of business areas
Bell Switzerland business area
- Substantially higher retail sales compensated for the slump in food service sales
- High productive capacity in spite of short-term changes in the mix of product ranges and channels
- Delivery readiness guaranteed at all times
- Very solid core business and better operating result than previous year
Sales revenue | Sales volume | Net investments |
in CHF million | in million kg | in property, plant and |
equipment/software | ||
in CHF million |
1,020 | 62.6 | 22.1 |
+ 3.8 % | + 1.6 % | + 22.8 % |
13.08.2020 | Bell Food Group, first half of 2020
Performance of business areas
Bell International business area
- All three divisions of this business area made operational progress and contributed to the improvement in results
- Strong organic growth in the poultry business, driven by the retail market for Bell Germany
- Sale of the German sausage business considerably reduced exposure to the food service sales channel and thus weakened the impact of the coronavirus pandemic
- Situation for raw material prices relaxed a little and the required and long overdue price increases could be realised
- Measures to enhance efficiency in the poultry business initiated last year have taken effect
Sales revenue | Sales volume | Net investments |
in CHF million | in million kg | in property, plant and |
equipment/software | ||
in CHF million |
482 | 102.4 | 17.4 |
+ 8.1 % adjusted* | + 2.0 % adjusted* | - 43.3 % |
*Adjusted for currency effects and acquisitions/divestments
13.08.2020 | Bell Food Group, first half of 2020
Performance of business areas
Convenience business area
- Hitherto growth drivers in the food service segment and to-go and fresh convenience in the retail segment harshly affected by the coronavirus fallout
- In contrast to Bell Switzerland and Bell International, the loss of earnings in food service could not be compensated to the same extent
- New production plants in Marchtrenk and Bad Wünnenberg laboured under the effects of the pandemic and have not yet achieved their planned volumes
- Product ranges and cost levels were immediately adjusted to the new sales conditions but a decline in earnings could not be prevented
Sales revenue | Sales volume | Net investments |
in CHF million | in million kg | in property, plant and |
equipment/software | ||
in CHF million |
515 | 96.9 | 42.8 |
- 3.6 % adjusted* | - 2.5 % adjusted* | - 4.3 % |
*Adjusted for currency effects and acquisitions/divestments
13.08.2020 | Bell Food Group, first half of 2020
Outlook.
13.08.2020 | Bell Food Group, first half of 2020 | Seite 29 |
Outlook
Outlook for second half of 2020
Bell Food Group
- Further effects of the coronavirus pandemic are difficult to gauge; careful crisis management to continue in order to limit the fallout
- Step-by-stepimprovement in food service expected while retail is expected to return to more or less the same levels as before the pandemic
- Further operational progress has to be achieved for all business areas
Bell Switzerland business area
- Securing of the earnings situation thanks to reaction and production capacity
- Implementation of strategic projects
Bell International business area
- Tension will remain high with regard to raw material prices due to volatile developments
- Focus still falls on air-dried ham and poultry as well as successful initiatives to improve efficiency and performance
Convenience business area
- On the strength of its strategic direction and high powers of innovation, it will benefit from the expected recovery of food service and out-of-home eating
- Will offer more added value to customers with innovative product ranges and food solutions
13.08.2020 | Bell Food Group, first half of 2020
Outlook
Outlook for second half of 2020
Bell Food Group
The pandemic-dominated first half of 2020 has shown that the Bell Food Group's robust and sustainable business model and its commitment to performance can stand firm in unusual situations. Thanks to its very solid core business with meat and meat products and its innovative and growth-driving convenience business, the Group is ideally equipped to weather extraordinary circumstances.
13.08.2020 | Bell Food Group, first half of 2020
Bell Food Group, first half of 2020
Broadly supported business model and high productive capacity ensure a good operating result
Financial analysts' presentation
13.08.2020 | Bell Food Group, first half of 2020
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Bell AG published this content on 13 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 August 2020 07:42:17 UTC