• Linkdin

Duni Q2'FY14 net sales hike 7.1%

11 Jul '14
5 min read

The trend in our largest business area, Table Top, gradually improved. The market for full-service restaurants has experienced weaker growth than the market in general, and consequently the 7% increase in sales during the quarter was generated by currency effects and also increased market shares. Due to certain disruptions in delivery capability and costs for growth initiative projects, profitability will not fully match that of last year.

The Meal Service business area operates in a more positive market climate. Growth amounts to 8% and we believe that the increase is well in line with the market as a whole. Meal Service is enjoying strong growth in Central Europe, but facing a tough challenge on the Nordic domestic market.
 
The Consumer business area has strengthened its positions significantly since 2012. During the past two years, several important contracts have been won and the change in strategy has resulted in a more attractive market offering. Among other things, the “Designs for Duni”® initiative has come to play an increasingly important role and it is pleasing that the concept is continuing to grow with strong profitability. Consumer increased its revenues during the quarter by 36% compared with last year. Paper+Design accounts for approximately one third of the growth. Profitability in the quarter is slightly stronger than last year.
 
As a consequence of last year's acquisition of Duni Song Seng, New Markets is continuing to grow at a very fast rate. Sales increased by 85% during the quarter. Excluding Russia and Singapore, other export markets have a growth of approximately 10%. We are continuing to face challenges on the Russian market, where domestic demand has fallen due to a sharp devaluation of the currency combined with the political climate. We are witnessing stable growth in other prioritized areas.
 
Materials & Services is experiencing a slowdown in sales but with more stable profitability. The trend is entirely in line with the phase-out model decided upon for the hygiene products business.
 
Duni's overarching ambition is to grow with profitability on prioritized markets. Growth will take place organically through gradually improved efficiency and market offerings, complemented by acquisitions. An additional acquisition was carried out during 2014, at the same time as initiatives vis-à-vis the market were intensified. Improved customer service, enhanced brand attractiveness and improved cooperation between market, logistics and sales are very highly prioritized in the work going forward.
 
As we now enter the second half of the year, we are doing so supported by underlying growth and the acquisition of Paper+Design. This is, of course, very gratifying, and top priority is now being given to implementing efficient, value-driving integration work,” says Thomas Gustafsson, President and CEO, Duni.
 

Duni AB

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