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According to market insights provided by Fact.MR, a renowned market research and competitive intelligence provider, the global apple juice concentrate market is anticipated to reach a valuation of USD 4.67 billion in 2024. The market is poised to witness a steady growth with a projected Compound Annual Growth Rate (CAGR) of 5.5 % between 2024 and 2034.

Apple juice concentrates, known for their versatility, have become a prevalent ingredient in a wide range of food and beverage products. The rising consumer inclination towards natural and healthier beverage options is fueling a robust demand for apple juice concentrates on a global scale. Noteworthy within the market is the ongoing trend of continuous product innovation. Leading manufacturers are actively engaged in developing organic and non-GMO variations of apple juice concentrates. Additionally, they are exploring novel flavors and blends to cater to the diverse preferences of consumers.

The key segments highlighted in the Apple Juice Concentrate Industry Research Report include growing consumer awareness and an increasing demand for clean-label products. Manufacturers are responding to these trends by placing a strong emphasis on environmentally friendly and transparent supply chain practices in the production of apple juice concentrates. This reflects a broader industry commitment to sustainability and responsible sourcing.

Key takeaways from market study

  • The global apple juice concentrate market is forecasted to reach USD 8.01 billion by the end of 2034.
  • Apple juice concentrate sales in the United States are predicted to rise at a CAGR of 4.9 % from 2024 to 2034.
  • Preference for organic products and a rich culinary culture is generating lucrative opportunities for apple juice concentrate producers in Germany.
  • Demand for apple juice concentrates in Japan is estimated at a market value of USD 120.6 million in 2024.
  • Organic apple juice concentrate sales are projected to reach USD 3.06 billion by the end of 2034.

“Rising trend of healthy food habits is boosting the demand for apple juice concentrates as natural and nutritious food ingredients,” says a Fact.MR analyst.

Winning strategy

Leading apple juice concentrate companies are focusing on continuous product innovations and forming strategic alliances to stay competitive. Product differentiation, sustainable practices, and agility in responding to market trends are key factors shaping market competition.

The landscape of the apple juice concentrate industry is marked by a diverse array of participants vying for substantial market shares and consumer attention. This includes not only prominent multinational corporations but also regional producers.

Established brands with a rich history command a strong presence in the market. Their enduring reputation, expansive distribution networks, and dedicated consumer following contribute to a competitive advantage and significant revenue streams.

In 2019, Coca-Cola India, a subsidiary of the renowned beverage conglomerate Coca-Cola, introduced a groundbreaking beverage product called Minute Made Apple Sparkle. This innovative addition was meticulously crafted using the finest Kashmiri apples and fell under the overarching brand name Minute Maid.

Key manufacturers of apple juice concentrate are Juice Generation, Hain Celestial, CEDAR Juice, Juice Warrior, Rauch Fruit Juice, Tree Top, and Huiyuan Juice.

Many German consumers highly value product quality and authenticity, creating an opportunity for apple juice concentrate producers to cater to this preference. By emphasizing premium quality and transparent sourcing practices, producers can tap into the demand of a consumer base that appreciates genuine and traditional appeal.

In Germany, the environmentally conscious consumer demographic actively seeks products with sustainable and eco-friendly production practices. The trend towards sustainability is particularly evident in the rising demand for organic apple juice concentrate products. Producers meeting this preference for organic options are not only aligning with consumer values but also securing substantial profit shares in the German market.

In the United States, an increasing awareness of health and wellness is fueling a demand for natural and healthier beverage choices. Apple juice concentrates, being versatile and widely used ingredients, align with consumers’ preferences for nutritious options.

The adaptability of apple juice concentrates in various food and beverage applications is another factor contributing to their steady demand. These concentrates serve as sweetening agents, extracts, flavor enhancers, and base ingredients in a wide range of products, including juices, sauces, and bakery items.

Back to his old domain: on January 1, 2024, Tobias Wetzel will become the new managerial head of Sales and Service at KHS. This has now been confirmed by the company’s supervisory board. The 50-year-old switches from the Mannesmann Stainless Tubes group, one of the world’s leading manufacturers of seamless stainless steel and nickel-based alloy tubes and pipes, to the systems provider. Between 2011 and 2020 Wetzel already held various managerial positions at KHS, most recently as head of the Service Division. He joins Kai Acker (CEO), Martin Resch (CFO Finance, Procurement and IT) and Beate Schäfer (CHRO) to complete the KHS Executive Management Board.

After finishing his Bachelor of Business Administration (BBA) in general management at what is now the Zeppelin University in Friedrichshafen, Wetzel gained a Master of Business Administration (MBA) from FOM International University for economy and management. His studies complete, he then started his career at Coca-Cola where he remained for over three years, amassing extensive experience in the beverage industry.

Prior to his starting in his new post, Wetzel held a number of managerial positions for the Dortmund systems provider over a period of ten years, first as head of RC Service Sales Support, then as executive vice-president of Corporate Controlling and finally as head of the Service Division until his departure. Between April 2015 and August 2019 he also assumed the management of the production site in Hamburg, then active under the name of KHS Corpoplast GmbH (now KHS GmbH). Before his time with the turnkey supplier, the graduate business economist spent around ten years in various functions at and companies of Mannesmannröhren-Werke – and has thus been working for Salzgitter AG, to which both companies belong, for over 20 years.

Symrise AG outstandingly capitalized on the economic recovery in 2021 and successfully continued the profitable growth course. The Group once again significantly increased sales and earnings. Symrise grew Group sales in reporting currency by 8.7 % to € 3,826 million (2020: € 3,520 million). Without taking into account portfolio and currency effects, organic growth amounted to 9.6 %. Earnings before interest, taxes, depreciation and amortization (EBITDA) at € 814 million were significantly above the prior-year figure of € 742 million. The Group maintained profitability at a high level with an EBITDA margin of 21.3 % (2020: 21.1 %). Against the backdrop of the positive development, the Executive Board and the Supervisory Board of Symrise AG propose a dividend increase for the 12th year in succession. Shareholders are to participate in the success of the company with a dividend of € 1.02 for the fiscal year 2021.

Symrise achieves strong sales and earnings growth with high profitability in fiscal year 2021
Dr. Heinz Jürgen Bertram (Photo: Symrise)

“2021 was a successful year all round for Symrise. We made good use of the tailwind generated by the global economic recovery and we aligned our sails accordingly. As a consequence, we very successfully continued our course of profitable growth. Additionally, we were also able to realize trailblazing purchases and investments. This allowed us to strategically diversify our know-how and our portfolio, further increase our appeal to customers and differentiate our profile in the market. Since September, Symrise has also been a member of the DAX, Germany’s leading index. As a result, our share has continued to gain a higher profile and enhanced appeal, particularly on the international capital markets. Part of our capital market philosophy is for our shareholders to participate in the successful development of Symrise AG. The Executive Board and Supervisory Board therefore propose the twelfth dividend increase in succession in the amount of € 1.02 for the year 2021,” said Dr. Heinz Jürgen Bertram, CEO of Symrise AG. “For the current fiscal year, we confirm our long-term target to achieve an average increase in sales of between 5 and 7 % (CAGR) and to exceed market growth. Furthermore, we are once again targeting high profitability for 2022 with an EBITDA margin of around 21 %, in spite of the increasing raw materials costs and energy prices.”

Economic recovery drives demand and leads to strong sales growth

The impacts of the coronavirus pandemic significantly diminished in large parts of the world over the course of the year. The behavior of consumers normalized and demand surged. Symrise increased sales in reporting currency by 8.7 % to € 3,826 million (2020: € 3,520 million). Organic sales growth amounted to 9.6 %. Symrise not only exceeded the average growth of the relevant market but also the most recent sales forecast issued in November 2021 of around 9 %. Regarding the regions, Latin America once again recorded the strongest organic growth of 13.5 %, followed by Asia/Pacific with 10.3 %. The regions EAME and North America also delivered very good growth with 8.8 % and 8.5 % respectively.

Significant increase in EBITDA and net income

In fiscal year 2021, Symrise increased earnings before interest, taxes, depreciation and amortization (EBITDA) to an outstanding € 814 million. The Company exceeded the prior-year level by 9.6 % (2020: € 742 million) in spite of the increased raw materials costs and costs of strategic growth initiatives amounting to € 174 million.

The group-wide EBITDA margin rose in the second year of the pandemic to 21.3 % and therefore exceeded the prior-year level (2020: 21.1 %).

Symrise increased net income by € 68 million to € 375 million (2020: € 307 million). Earnings per share rose to € 2.74 (2020: € 2.27). In view of this positive development, the Executive Board and the Supervisory Board will propose to the annual general meeting on 3 May 2022 a dividend increase to € 1.02 per share for the fiscal year 2021 (2020: € 0.97).

Net debt with 2.4 in targeted margin range

As of 31 December 2021, net debt including pension and leasing liabilities decreased to € 1,964 million (2020: € 2,029 million). This corresponds to a ratio of net debt to EBITDA of 2.4.

The business free cash flow amounted to € 486 million (2020: € 564 million).In spite of the increase in earnings, it was defined above all by higher investments, an increase in inventories (strategic stockpiling in order to mitigate the risks due to delays in international supply chains) and a high level of trade receivables as a consequence of the strong growth in sales.

In a year-on-year comparison, the equity ratio rose from 39.8 % to 49.0 %. Symrise thus has a very solid foundation for continued sustainable growth of its business in the future.

Taste, Nutrition & Health segment

In April 2021, Symrise merged the former two segments Flavor and Nutrition into a new segment and renamed it Taste, Nutrition & Health to reflect the purposefully implemented portfolio expansion. It is intended to align the expanded activities even more closely with customer needs and hence make know-how, technologies and product knowledge a shared asset. Over the course of the year, Symrise strengthened the activities through the acquisition of the Canadian manufacturer Giraffe Foods and invested in a stake of the Swedish animal health company Swedencare. The core business no longer includes the food color application areas which have been sold to Oterra as well as the Drinkstar Velcorin activities. The distribution model with Lanxess was terminated effective 1 January 2022.

Taste, Nutrition & Health increased sales by 8.5 % to € 2,335 million (2020: € 2,151 million). Organic growth even amounted to 10.6 %. The change in behavior in out-of-home leisure activities and the increasing trend of on-the-go consumption resulted in a particular high demand for beverage applications. Furthermore, the segment benefited from very dynamic growth rates in the Pet Food segment.

Taste, Nutrition & Health increased EBITDA to € 531 million (2020: € 471 million). The EBITDA margin at 22.7 % was at an outstanding level and significantly exceeded the prior-year value (2020: 21.9 %).

Symrise confirms long-term growth and profitability targets

According to experts estimates, the global economy will slow down slightly in the current fiscal year after the strong recovery in 2021. Symrise is excellently positioned with its robust business model, the diversified application portfolio and its broadly based regional presence and customer base. The Company therefore confirms its long-term growth and profitability goals. Symrise continues to target above market growth and increase average annual sales by 5 to 7 % (CAGR). This objective also applies to the current financial year 2022, in spite of increasing raw material costs.

Symrise is committed to organic and inorganic growth, which includes the acquisition of the Dutch company Schaffelaarbos in January 2022 and the Chinese Wing Pet Food in February 2022. Furthermore, Symrise will maintain strict cost consciousness and continue the holistic sustainability management in all its divisions.

Profitability is projected to remain at a high level in 2022 with an EBITDA margin of around 21 %. Over the medium term until the end of fiscal year 2025, Symrise has a target of achieving an EBITDA margin in the corridor of 20 to 23 %.

Krynica Vitamin, one of the top Polish producers of non-alcoholic and low-alcohol beverages, faced many challenges in the second quarter of this year, which influenced the delivered financial result in the first half of 2021. The key factors influencing the achieved results included, in particular, the unpredictability on the raw materials market, which translated into low availability and increased prices of packaging, coupled with growing transport costs, including freight. According to published estimates, the WSE-listed company achieved $52 million (PLN 202.5 million) in sales revenue in H1 2021, which converted into operating profit of $1,3 million (PLN 5.2 million) and net profit of $1,2 million (PLN 4.8 million).

Krynica Vitamin stresses that in its core business, beverage revenue increased by more than 15 percent year-on-year. The Company’s goal is to attract customers with high production volumes. In the second half of the year Krynica Vitamin will focus on further improvement of its standing on the beverage production market, and geographical diversification, looking for customers also in Europe and customers that can be reached by truck, for example France.

Our financial situation is stable and our development is not threatened, despite turbulences. The coronavirus pandemic has shaken the global market, disrupting the supply chain, while the rise in commodity prices has caught businesses by surprise. This has translated into limited access to packaging, particularly aluminum cans, as well as other materials needed to package products like wooden pallets, foil and cardboard. We also experience a continuous increase in labour costs, as well as transport costs – said Piotr Czachorowski, President of the Board of Krynica Vitamin SA.

The Company’s Board notes an increase in transportation costs, primarily by sea. In 2021, the two major markets were the U.S. and Germany.

When we shipped beverages to New Zealand and Australia at the beginning of the year, we did not consider intercontinental trade restrictions. Not even six months later we noted a nearly tenfold increase in the cost of deliveries. This is a huge challenge in overseas exports. Not only have freight prices risen, but Europe is suffering from a shortage of containers, with delays in unloading operations at U.S. and Chinese ports. Many industries have been affected by this disrupted supply chain. The obstruction of the Suez Canal for a just a few days or restrictions on the operations of major ports in China, have a negative knock-on effect for the trade. Despite the challenging environment, we are focused on maximizing the use of our resources and assets. We have rescheduled our investment pipeline due to the delays in obtaining administrative permits. Thus, our capex plan of PLN 38 million will be performed at the level of about 60 percent. Other outlays will be moved to later periods – said Piotr Czachorowski.

Krynica Vitamin in the current difficult market conditions is focused on driving the beverage segment, in which it has the highest competence, best experience, and strongest market position. Recently, the Company notified its investors that it has signed new agreements. In order to increase financial efficiency, the R&D is developing new beverage formulas with less sugar, among other things.

For nearly 30 years, Krynica Vitamin has been shaping the beverage market in Poland, creating innovative products in response to health trends. The company is a showcase of the Polish food and beverage industry in the world. The Company’s products are present in nearly 40 markets around the world. In 2020, exports accounted for more than half of revenue, with Germany, the United States, and the United Kingdom being the main overseas markets.

The coronavirus pandemic is leading to a surge in demand for organic and sustainable foods. Retailers across the globe are experiencing hefty sales increases for organic products. Ecovia Intelligence expects the sales lift to continue in the coming years.

Online retailers are reporting the highest sales growth. Whole Foods Market, the world’s largest natural food retailer, has started limiting the number of its online grocery customers because of unprecedented demand. In the UK, Abel & Cole reported a 25% increase in sales orders, whilst Riverford is reporting a demand surge. Nourish Organic, an Indian online retailer, experienced a 30 % sales rise last month.

Physical retailers are also benefiting from emergency measures introduced by various governments. Organic and health food shops have remained open in many countries; they are attracting new shoppers, whilst existing customers are spending more. In France, some organic food shops are reporting sales increases of over 40 %. COVID-19 is raising consumer awareness of the relationship between nutrition and health. Consumers are buying more organic and healthy foods as they look to boost their personal immunity.

The surge in demand is however bringing supply issues. The organic food industry is now global with international supply networks that are coming under pressure. Many of the raw materials used by European and North American organic food companies are produced in Asia, Latin America and Africa. Lockdowns are disrupting supply chains. For instance, India is a major source of organic tea, herbs, spices & related ingredients. Emergency measures introduced in March have halted food processing and exports.

Ecovia Intelligence expects demand for organic & sustainable foods to remain strong after consumer fears subside. Previous food and health scares caused an initial sales spike followed by sustained demand for organic products. For instance, the BSE crisis in 2000 escalated demand for organic meat products in Europe; sales remained buoyant in subsequent years. Similarly, SARS led to a spike in demand for organic foods in China (and Asia) in 2004. The melamine scandal in 2008 bolstered demand for organic baby food in China. Within a few years, the Chinese market for organic infant formula became the largest in the world.

Organic foods were first introduced on a large-scale in the early 1990s. It took over 15 years for global organic product sales to reach USD 50 billion in 2008. Ten years (2018) later, they surpassed the USD 100 billion mark. With COVID-19 changing the way we shop and eat, the next leap to USD 150 billion could be within the next 5 years.

About Ecovia Intelligence

Ecovia Intelligence (formerly known as Organic Monitor) is a specialist research, consulting & training company that focuses on global ethical product industries. Since 2001, we have been encouraging sustainable development via our services portfolio: market research publications, business & sustainability consulting, technical research, seminars & workshops, and sustainability summits.

The heavy rains that hit São Paulo State in the first fortnight of February did not result in losses in orange groves, but reduced sales and hampered activities in the field. It is worth to mention that the harvesting pace is usually a lot slower in the first quarter of the year and that many of the fruits available in the market in the first half of the month had undesirable features, such as larger size, thick peel and were beginning to crystalize.

According to Fundecitrus (Citrus Defense Fund), the harvesting of the current crop is ending in the Brazilian citrus belt (São Paulo and Triângulo Mineiro), having reached 96 % of the area, on average, for all varieties. In pera rio groves, 97 % of the oranges have been harvested, for valencia and folha murcha, 95 %, and for natal, 93 %.

Despite the lower quality in the current off-season period, precipitation should not reduce the output in the 2019/20 crop, but underpin prices in the in natura market – as supply is low, the demand for higher quality oranges should be firm. Between February 3 and 14, pear orange prices averaged 32.68 BRL per 40.8-kilo box, on tree, 10.8 % up compared to that in the first half of January.

FUNDECITRUS – On February 11, Fundecitrus released their third estimates for the current season (2019/20). According to the report, the output should total 384.87 million 40.8-kilo box, 0.11 % down compared to that forecast in December/19 and 1.03 % lower than the first crop estimates, released in May/19.

According to the report, the rain volume between May/19 and Jan/20 was lower than the historical average in almost all producing regions (except in northern and northwestern SP), which limited growth, primarily for the varieties hamlin, westin, rubi, folha murch and natal. In general, the oranges have reached different sizes among the producing regions in the citrus belt, due to irregular rains.

TAHITI LIME – The rainy weather in São Paulo in the first fortnight of February hampered field activities and helped to control supply (it is worth to mention that, currently, tahiti lime is at crop peak). Still, on the average of the period, tahiti lime prices dropped 18.2 % compared to that in the same period of January, averaging 11.65 BRL per 27-kilo box, harvested, in the first half of February.

TOP bv from Wageningen will outsource the sales and marketing of food processing equipment to Like Fresh. All equipment that is produced in series by TOP will be marketed by Like Fresh, starting this week. This will allow TOP to continue to focus on the development of new technologies.

TOP is the innovation organization behind successful introductions such as the Cold Press, Pluckr, PurePulse, Hygienisator and Compact Food Dryer. The demand from the food industry for these technologies is high, as a result of which the equipment is now produced in series. To maintain its unique innovation capabilities, TOP has decided to outsource the marketing of this equipment to Like Fresh.

TOP will continue to focus on the development of highly innovative food processing technologies. In addition, TOP will continue to offer consultancy projects for customers, and provide Like Fresh with the necessary engineering support.

Like Fresh – a sister company of TOP – is a new organization in which years of experience in the food industry has come together. “We offer extensive knowledge of the latest developments in mild preservation and storage of fruit and vegetables”, says Rob Veltman, director. “Like Fresh provides high-quality solutions for producers around the world, such as new process lines or innovative applications within existing processes. In this we work together with the engineers from TOP and other innovation partners.”

Dr. Johannes-Thomas Grobe is to be the new head of Sales and Service at KHS GmbH. This has now been confirmed by the company’s supervisory board. The 53-year-old shall be moving from Dürr Systems AG, a machine and systems manufacturer for the automobile industry, to the Dortmund systems supplier. Dr. Grobe joins chairman Kai Acker and Martin Resch on the KHS Executive Management Board.

The restructuring of the KHS Executive Management Board is now complete. “We’re very pleased to have gained a proven expert and leader for our company in Dr. Grobe. He brings with him a wealth of industrial experience gleaned during his professional career,” says Acker, chairman of KHS’ Executive Management Board. Dr. Grobe has extensive knowledge as an executive manager of product and technological developments, innovative projects and production and manufacturing processes.

The computer scientist, who obtained his PhD from RWTH Aachen University in 1998, initially held various posts at Bosch Rexroth AG, among them the vice-presidency of Sales for Industrial Management, Key Account Management and Application Development for Industrial Applications. Dr. Grobe was then managing director of Bosch Rexroth in India.

On September 1, 2015, he joined Dürr Systems AG as senior vice-president of Sales and Marketing for Paint and Final Assembly Systems. On April 1, 2019, Dr. Grobe will take up his new position as head of Sales and Service at KHS. “We’re well set up for the future and shall together generate key impetus for the growth of the KHS Group,” states Acker.

Cott Corporation announced the sale of its soft drink concentrate production business and its RCI International division (“Cott Beverages LLC”) to Refresco for USD 50 million, who in turn sold the RCI worldwide branded activities to RC Global Beverages Inc.

“This transaction is the final step in the transformation of our business where selling the remaining business unit of the traditional carbonated soft drinks business is consistent with our strategy of accelerating the growth across our platform in water, coffee, tea, extracts and filtration solutions,” commented Tom Harrington, Cott’s Chief Executive Officer. “We want to thank all the associates of Cott Beverages LLC for their contributions and wish them well as they rejoin their former traditional bottling business colleagues and become a part of Refresco,” continued Mr. Harrington.

Hans Roelofs, CEO Refresco: “We are pleased to add Cott’s Columbus concentrate manufacturing facility to Refresco North America. It adds extensive innovation capabilities and skills and creates a global center of excellence for beverage concentrate manufacturing. It is a perfect fit with our business.  We have decided to divest the RCI International branded activities and find an owner who can bring similar focus and continuity to this iconic brand. With RC Global Beverages Inc., we believe we have found an excellent match. The sale of Columbus from Cott to Refresco and the sale of the RCI International activities from Refresco to RC Global Beverages Inc. took place simultaneously.”

Today more than two-thirds of consumers worldwide own a mobile phone, with figures surpassing the 5 billion mark in June 2017, according to GSMA data. For shoppers, a mobile phone is an integral part of their lives and they are keen to use its facilities – particularly when it comes to checking out food quality and traceability and winning prizes.

The key theme of this year’s Consumer Goods Forum global summit, held in Singapore, was ‘Consumer Centricity in a Data Driven World’. Minister for trade and industry S. Iswaran spoke of Singapore’s Retail Industry Transformation Map, which encourages retailers to use innovative technologies to improve productivity and the in-store experience for shoppers and suggests all consumer goods businesses embrace data and technology to drive innovation.

The connected consumer

This year, a sales promotion pilot using individual QR codes on every SIG carton pack was trialled in southern Brazil by Languiru, one of the largest dairies from the state of Rio Grande do Sul, with some impressive results. QR codes were used on all cartons of Languiru milk, including chocolate milk (Chocolan), with more than 12,000 codes generated every hour, connecting the consumer with product data via their smartphone.

Consumers in store said it was easy to download the Languiru app, developed by SIG, and liked that the milk was from the local region. Their children were delighted with the emoji cushions they were able to redeem with the coupons and took them into school to show to their friends and teachers. Those shoppers buying the largest volume of milk gained the most cushions and they were extremely popular, leading to a 6 per cent growth in sales for this milk and chocolate milk brand. Prizes included bicycles, smartphones and shopping vouchers!

Interestingly, 94 % of participants were android phone users and just 6 % apple users with 71 % of those using the code women, including 56 % in the 19 – 30 age group and 35 % in the 31 – 60 age group.

Tailor made promotions

Dirceu Bayer, President of Cooperativa Languiru, said: „SIG’s solution not only provides a 1:1 connection with our final consumers, but also opens up opportunities for tailored made raffle promotions with our retailer partners. The giveaway promotion ‘Bought, looked, won’ fully met expectations and improved our relationship with our customers. Through the use of this technology we can learn more about our consumers, providing valuable information for commercial and marketing teams“.

Languiru’s latest digital promotion is the next stage in making best use of the integrated Connected Pack Solution, designed by SIG and Siemens, which collects product quality data at every stage of the product journey, from the beginning of industrialization process of the raw material to the supermarket shelf, and stores all information in one database. The dairy concept ‘Qualidade do inicio ao fim’, which translates as ‘Quality from beginning to end’, was the basis for Languiru to engage with consumers who can access all important data, from production dates to quality analysis. The QR code has become Languiru’s quality stamp, resonating in other products and categories within the portfolio. This builds on the established inline monitoring system and vast data collection, which ensures efficiency in both production and logistics.

Monitoring operations and logistics

„QR codes on cartons mean our consumers are able to trace products from their industrialization right to the shelf,” said Euclides Andrade, Managing Director of Cooperativa Languiru.

“Besides that, we benefit from detailed end-to-end value chain performance monitoring, which enables us to improve operations and logistics. SIG understood our demands and developed a tailor-made solution for Languiru that demonstrates our quality and adds value to our brand ».

A further advantage of this new technology is that it is linked directly to the Languiru production lines. This maximises the dairy plant’s overall efficiency and cuts operational and investment costs by using a specific information intelligence tool known as Power BI.

The power of a single QR code is substantial in enabling track and trace from plant to store shelf. SIG is ahead of the game when it comes to enabling a connected pack experience and can offer customised solutions, benefiting the consumer, manufacturer and retailer along the supply chain.

Novozymes announced its results for the first quarter of 2018. Q1 organic sales growth of 2 % in line with our expectations: Household Care +1 %, Food & Beverages +5 %, Bioenergy +9 %, Agriculture & Feed -5 %, Technical & Pharma -10 %. EBIT margin at 28.9 %. FCF before acquisitions DKK 403 million. 2018 outlook maintained on all parameters.

Peder Holk Nielsen, President & CEO of Novozymes: “We’re well in line to deliver on our full-year sales growth outlook of 4-6 %, and margins are strong despite a significant currency headwind. We continue to see good progress on our key priorities, including increasing presence with new and existing customers to cater for their individual needs. There is still some uncertainty in the agriculture-related business, including from recent geopolitical tensions. However, with current insight, we remain firm about accelerating sales growth throughout 2018 and beyond.”

Highlights Q1:

  • Organic sales growth of 2 % and -6 % in DKK. USD/DKK decline of 13 % in Q1 y/y
  • Growth in Household Care, Food & Beverages and Bioenergy
  • Agriculture & Feed and Technical & Pharma lower, mainly due to continued pressure from certain agriculture markets, as well as timing in Pharma
  • 6 % organic growth in emerging markets; developed markets on par with last year
  • Strong product development: launch of first yeast solution – Innova® Drive – for conventional biofuels, EU approval of probiotic solution Alterion® for poultry, approval of microbial corn bioyield product Acceleron® B-360 ST for the US and the EU, and launch of a new enzyme class for automatic dishwash enabling easy removal of dried-in cereals
  • Strong EBIT margin of 28.9 %, up due to timing of emerging markets’ ramp-up costs and despite currency headwind. Q1 2017 at 27.0 % (~29 % excluding reorganization costs)
    Free cash flow before acquisitions at DKK 403 million
  • Dividend payout of DKK 4.50/share. 42 % payout ratio
  • Full-year 2018 outlook maintained: Organic sales growth 4-6 % (growth relatively stronger in 2H y/y), EBIT margin ~28 %, FCF before acquisitions DKK 2.3-2.6 billion, ROIC 24-25 %

Over the first two months of 2018 UK retailers Waitrose, Tesco, Co-op, Asda, Sainsbury’s, Aldi, Lidl and Morrisons – the UK’s seven largest food retailers – all implemented their own bans on the sale of energy drinks to children. This is despite the lack of any formal direction or regulation from the UK government, observes GlobalData a leading data and analytics company.

In March 2018 Boots became the first non-supermarket retailer to join them. Specifically, this means banning the sale of products with a caffeine content of more than 150 mg per litre to under-16s. The fact this potentially profit limiting step has been taken without government regulation or a call for retailers to take voluntary action is unusual, but emphasises the importance large retail chains place on maintaining a responsible brand image.

Associate Analyst at GlobalData, William Grimwade commented, “Major retailers have become extremely concerned about monitoring opinion of themselves on social media, and the highly competitive nature of British supermarket retailing means retailers do not want to be seen to be out of step with their competitors on issues like this”.

The National Association of Schoolmasters Union of Women Teachers (NASUWT) has gone as far as attributing some cases of poor behaviour of children in schools to high energy drink consumption. The #NotforChildren campaign has become prominent on social media among a variety of stakeholders, including health concerned celebrity chef Jamie Oliver, the charity Action on Sugar, the MP Maria Caulfield and NASUWT, the teachers union.

Grimwade adds, „Retailers and energy drinks producers are also likely to suffer from the introduction of the sugar tax in the UK from 8th April 2018. The vast majority of energy drinks brands rely on sugar, as well as caffeine and other additives, to allow them to give the consumer the energy rush their brand depends on. This means that they will be unable to reduce sugar content and their prices in independent retailers still selling them to under 16’s will be forced upwards, compounding the effect of the supermarkets ban.“

The carbonated soft drink (CSD) sector in Australia is facing continued pressure amid consumer concerns about sugar. New research from global market intelligence agency Mintel reveals that total volume sales of Australia’s CSD category are expected to see a 2.3 % decline in 2017. In fact, CSD sales dipped 4.7 % in 2016 since 2014.

Mintel research indicates that negative sentiments towards sugar have driven many Australians to reconsider their sugar intake. One in three (34 %) metro Australian consumers* say that they are limiting the amount of sugar/sugar substitutes in their diets, while three in 10 (29 %) are avoiding items with sweeteners. Furthermore, as many as three in five (58 %) Australians say they are limiting their consumption of sugar and sugar substitutes in an effort to to watch their weight, while over half (53 %) do so because of future health concerns (eg. developing diabetes).

Jenny Zegler, Global Food & Drink Analyst at Mintel, said:
“With concerns about obesity rates and overall health in Australia, many consumers are now focusing on sugar and sweetener content when choosing food and drink, with some limiting the amount of sugar or sweeteners in their diets. These concerns have especially taken a toll on Australia’s carbonated soft drinks category, which is forecast to see further sales declines by the end of 2017. Carbonated soft drink companies that seek to reconnect with consumers must take into account that concerns about sugar and sweeteners will continue to be a focal point for consumers moving forward.”

Indeed, it seems there is close scrutiny on the sugar content found in CSDs among Australian consumers; over a third of (35 %) metro Australians say that they check for the level of sugar/sweetener content in CSDs and 30% check for the types of sugar/sweeteners.
While personal preferences for or against sugar or specific sweeteners may vary by the individual, it appears that many Australians have a desire for more clarity around sugar content. More than three in five (64 %) metro Australians say they feel cheated when a company is not clear about the high sugar content of its products. What’s more, as many as three in four (76 %) agree that food and drink companies should make it easier to understand how much sugar is in their products.

Shelley McMillan, Trend & Innovation Consultant, ANZ, at Mintel said:
“Our research points to the necessity for simple and direct communication to reassure Australian consumers who are wary of their sugar consumption. To avoid consumer confusion or concern, products could define the amount and type of sugar or sweeteners on product labelling to ensure that consumers can easily understand the sugar content of food and drink. Currently, the provision of front-of-pack sugar descriptions by carbonated soft drink companies are few and far between. This challenges more companies to be transparent in their claims.”

Meanwhile, even though consumers are looking for reduced sugar products, innovation activity does not necessarily align with interest. According to Mintel Global New Products Database (GNPD), ‘low/no/reduced sugar’ is a claim carried by just 12 % of CSD product launches in Australia in the two years to October 2017**. This is just below the already low global average of 15 % of CSD introductions launched globally in the same time period.
Finally, Mintel research shows that consumers think that manufacturers could be more aggressive in creating reduced-sugar formulations, with three in four (74%) metro Australians agreeing that food and drink companies should be doing more to reduce the amount of sugar in their products.

“Though there is a demand for reduced sugar food and drink products, companies are not doing enough when it comes to new product development. In fact, our research indicates that there is a definite opportunity for players in the carbonated soft drink industry to introduce more low, no or reduced sugar offerings into the Australian market. Another key way of enticing consumers to stay engaged with the category is for CSD brands to consider developing low, no or reduced sugar limited edition flavour offerings,” Jenny concludes.

*1,406 internet users aged 18+ from major metropolitan cities in Australia, polled in 2017
**November 2015 to October 2017

Krones, the world’s leading manufacturer of filling and packaging technology, continued its stable growth in the first half of 2017. Overall, revenue improved 13.8 % year-on-year to €1,775.2 million. Adjusted for acquisitions, revenue was up 10.2 %. The increase was partly due to a relatively low baseline of sales in the first half of 2016. The strongest revenue growth came in the North and Central America, Asia-Pacific, and South America/Mexico regions in the period from January to June 2017.

Order intake at Krones increased 11.0 % in the first half of 2017 to €1,779.3 million. Adjusted for acquisitions, order intake was up 4.7 % year-on-year. Orders growth in Western Europe and Latin America was higher than overall orders growth. Order intake in China was lower. In the Asia-Pacific, North America, and Middle East/Africa sales regions, order intake was stable. At €1,148.8 million, orders on hand at Krones at the end of June 2017 were up 1.1 % over the year-earlier period.

EBT margin is 6.8 % after six months
Krones improved earnings before taxes (EBT) by 12.8 % to €121.0 million in the period from January to June 2017 despite a highly competitive market situation. As expected, market prices provided no support. By contrast, the Value strategy programme, with which Krones is increasing efficiency throughout the company, had a positive impact. At 6.8 %, the EBT margin for the first six months of 2017 was nearly unchanged year-on-year (previous year: 6.9 %). After taxes, net income was up 10.8 % to €82.4 million. Earnings per share increased from €2.37 in the previous year to €2.64.

The ratio of average working capital for the past four quarters to revenue came to 26.3 %, after 25.5 % in the year-earlier period. However, the ratio is an improvement over the first quarter of 2017 (26.8 %).

The return on capital employed (ROCE) increased to 16.3 % (previous year: 15.6 %). In the period from January to June 2017, the company generated operating free cash flow of -€126.7 million (previous year: -€155.5 million), which is an improvement of around €30 million.

Krones forecast for 2017 is unchanged
The company’s revenue growth target (excluding acquisitions) for the year 2017 as a whole remains 4 %. Profitability should be stable this year. Krones expects the EBT margin to be around 7.0 % for the year 2017. For its third financial performance target, working capital to revenue, the company is forecasting 27 % for the current financial year.

Krones has published the complete half-yearly report online at https://www.krones.com/en/company/investor-relations/reports.php.