Rising prices for products, expansion of capacities and increased exports helped large oil and mayonnaise producers Efko Group of Companies and Rusagro Group of Companies to show the highest revenue growth in the food industry. Over the past year, the turnover of the groups grew by 20.4% and 15%, respectively. It will be difficult to maintain the pace in the future, given the strengthening of the ruble, state regulation of prices and export restrictions.
The fastest growing in the food industry in terms of revenue last year was the Efko Group of Companies, which produces sauces, vegetable oils and other products under the Sloboda and Altero brands, according to the Infoline rating. The group’s turnover increased by 20.4%, to 146.9 billion rubles, which corresponds to the fifth place and allowed Efko to outstrip the Russian structure of the American Mars with a turnover of 139.5 billion rubles. Rusagro Group of Companies (produces sugar, meat, fat and oil products under the brands “Chaikofsky”, “Word of the Butcher”, “Dream of the Hostess”) of ex-Senator Vadim Moshkovich showed dynamics comparable to Efko: the group’s revenue grew by 15%, to 158 , 9 billion rubles. As a result, Rusagro took third place, ahead of the snack and confectionery manufacturer KDV (Kirieshki, Yashkino, etc.) with a turnover of 153.9 billion rubles.
Infoline associates Efko’s results with an increase in exports, including to China and India, an expansion of soybean processing capacity in the Belgorod Region, the launch of new lines for the production of margarines in the Krasnodar Territory, and the purchase of 51% of the Lipetsk oil plant Liboil. Efko did not provide a comment. In its financial statements, Rusagro explains the increase in revenue by an increase in prices for fat and oil products, pork and agricultural crops, as well as an expansion of meat processing, which offset the decline in sales and sugar prices. In the first quarter of this year, Rusagro’s revenue grew by 52% to RUB 49.93 billion. Group CEO Maxim Basov did not give forecasts for the whole year.
PepsiCo (Pepsi, Lay’s, J7, “House in the Village”) and Nestle (Nescafe, Kitkat, Gerber) kept the first and second places in the rating. The revenue of companies in Russia increased by 2.8% to RUB 217 billion. and by 12.7%, to 165.8 billion rubles. respectively. PepsiCo says revenue was boosted by a diversified portfolio of dairy products, baby food and snacks, beverages, and e-commerce. The company refused to give a forecast for 2021. Nestlé does not comment on financials.
According to Infoline estimates, in 2021, AB InBev Efes (beer BUD, Stella Artois, Corona Extra) may enter the ten largest players in the food industry, while maintaining sales growth rates. Last year, the company’s revenue increased by 16.5%, to 76.9 billion rubles, which corresponds to the conditional 11th place. In the first quarter of this year, sales of AB InBev Efes brands grew in the range of 10-27%, and the supply of non-alcoholic products online – by 400%, according to Infoline. In AB InBev Efes itself, they are more cautious in their forecasts. Oraz Durdyev, Director of Legal Affairs and Corporate Relations of the company, recalls the difficult economic situation, which affects the income of the population, and clarifies that sales will depend on currency fluctuations, the cost of materials and excise taxes, regulatory measures, as well as the weather.
Sovecon director Andrei Sizov says that global prices for all major food items, including sugar, butter and pork, generally continue to grow year-on-year, and in the case of meat, one can see an acceleration in the pace. In Russia, according to him, the financial results of companies will also depend on the ruble exchange rate and state regulation: the maximum prices for sunflower oil have been set until October 1, and a “floating” duty will start working in the new season. Taking into account the beginning of the strengthening of the ruble, Mr. Sizov is not sure that Efko and Rusagro will be able to maintain the same level of revenue growth this year.