KANSAS CITY, MISSOURI, US — Foreign grain-based foods companies turned in disappointing share price performance during 2020, the second straight year in which more than half of the companies tracked by Milling & Baking News, a sister publication of World Grain, finished lower year-over-year. The coronavirus (COVID-19) pandemic hit many companies’ share prices hard in mid-March, and while several companies were able to battle through the crisis, a significant number were unable to do so.
A total of 27 of the 40 companies tracked by Milling & Baking News recorded year-over-year decreases in share price during 2020 while only 13 posted increases. By comparison, 10 companies recorded year-over-year increases in 2019, while 19 companies recorded year-over-year increases in 2018, 23 companies recorded year-over-year increases in both 2017 and 2016, 19 posted increases in 2015, 25 companies posted increases in share price in 2014, and 32 companies posted year-over-year gains in 2013.
On the London Stock Exchange, Associated British Foods finished the year at 2264p, down 13% from 2598p in 2019 and compared with 2043p in 2018. “Grocery delivered another year of strong profit and margin improvement,” Michael McLintock, chairman of ABF, said in the company’s annual report. “In the second half of the year this included higher retail sales, which more than offset a decline in foodservice as a result of COVID-19. A significant improvement in the profits of our European and Chinese sugar businesses more than offset a disappointing result for Illovo. The improvement in Ingredients was driven by substantially higher demand for AB Mauri’s yeast and bakery ingredients.”
Carr’s Group PLC’s share price closed at 129.5p in 2020, down 16% from 154.5p in 2019. In September, Carr’s named Hugh Pelham chief executive officer, effective Jan. 4, 2021. Pelham has more than 30 years’ experience in leading growing businesses across various sectors. He most recently was global president at Minova, part of ASX-listed Orica, which is a manufacturer and supplier of chemical and mechanical earth control products, adhesives and support equipment.
Tate & Lyle PLC, the global sweetener company, had a 52-week high of 811.4p in early February and fell to a low of 493.8p in mid-March, before ultimately closing at 674.4p, down 11% from 760.2p in 2019. Tate & Lyle in early December acquired Sweet Green Fields, Bellingham, Washington, US, a manufacturer of stevia-based ingredients. Tate & Lyle and Sweet Green Fields have been working together since 2017, when Tate & Lyle became the exclusive global distributor of the company’s ingredients around the world. A year later, Tate & Lyle acquired a 15% stake in Sweet Green Fields. Earlier in the year, the company said it would invest $75 million in a natural gas-fired combined heat and power system at its corn wet milling facility in Lafayette, Indiana, US. The system will provide significant environmental and economic benefits at the Lafayette South facility. The investment supports the company’s sustainability targets for 2030, which include reducing greenhouse gas emissions, eliminating coal from its operations and reducing water use.
Premier Foods, the UK’s largest food producer, finished 2020 at 100.2p, up 165% from 37.85p in 2019. Premier’s stock price surged in late June as demand for its retail products, including Mr. Kipling cakes, jumped as consumers stockpiled products in connection with the coronavirus pandemic. In November, Premier (along with Gores Group) sold the Hovis bread brand to Endless LLP, a private equity firm based in the United Kingdom.
Finsbury Food Group PLC, the UK-based maker of cake, bread and gluten-free bakery goods, climbed to a 52-week high of 105p in early April before falling to 50.5p in mid-October. A slow rise over the past several months led to a year-end close of 79.5p, which still left the company’s share price down 20% from 99p in 2019.
Greggs PLC, an operator of retail bakery shops and cafes in the United Kingdom, finished at 1790p, down 22% from 2298p in 2019 and compared with 1266p in 2018.
The three leading UK retail chains suffered share price declines during the past year. Tesco closed at 231.4p, down 9% from 255.2p a year ago. Meanwhile, Marks & Spencer fell 36% to finish the year at 136.3p, down from 213.5p, and Sainsbury, PLC closed the year at 225.5p, down 2% from 229.9p in 2019.
In Ireland, Greencore Group PLC, a European maker of convenience food and malt products, finished at 116.5p down 57% from 267.9p in 2019. In July, Greencore sold its interests in its molasses trading businesses to United Molasses Marketing (Ireland) Ltd. and United Molasses Marketing Ltd.
Kerry Group finished the year at €118.5, up 7% from €111.1 in 2019 and compared with €86.5 in 2018. In a move that would allow the company to expand its core food ingredient business, Kerry Group PLC in mid-December was said to be exploring the possible sale or spinoff of its consumer foods business, according to Bloomberg. The company’s Kerry Foods division sells refrigerated meat and dairy products with brands that include Richmond sausages, Dairygold spreads, Charleville cheese and Cheestrings snacks. The company also makes Rollover hot dogs and Naked Glory meat substitutes. Earlier in the year, Kerry expanded its clean label food protection capabilities with the acquisition of IsoAge Technologies and Biosecur Lab Inc. IsoAge is a supplier of functional ingredients, including MOstatin All-Natural Antimicrobials and INNOstatin All-Natural Flavorings. The company also offers vinegar-based flavor systems, fruit and vegetable juices and purees, organic sweeteners, green tea extracts, decorticated flours and hydrocolloid gums. BioSecur Lab offers a range of citrus-based functional ingredients for food and beverage products.
Origin Enterprises, a food and agribusiness group based in Dublin, Ireland, finished the year at €3.1, down 16% from €3.71 in 2019.
In Australia, GrainCorp Ltd. closed the year at A$4.19, down 45% from A$7.58 in 2019. In September, GrainCorp named Ian Morrison as chief financial officer. Morrison joined GrainCorp in 2011 and has held senior finance roles across all areas of the company, including CFO of the Grains division. His experience at the company includes commercial finance, IT, mergers and acquisitions, capital management, and shared services.
Nutrien Ltd., which was formed in January 2018 as a merger of Agrium Inc. and PotashCorp., closed 2020 at C$61.24, down 1% from C$62.17 in 2019.
In France, Groupe Danone SA, the country’s largest food and beverage company, closed 2020 at €53.76, down 27% from €73.9 in 2019. In November, Danone said it is undergoing significant changes. Management has shifted the company’s focus from global to local, committed to reducing costs by $1.9 billion by 2023 and is in the process of redesigning its approach to procurement, innovation and manufacturing. The latter efforts will have a lasting impact that will permeate throughout the organization. Henri Bruxelles, chief operating officer of end-to-end design to delivery for Danone, said the company plans to eliminate more than 2,000 stock-keeping units in 2021.
In London, England, Unilever, the food and personal products business, closed 2020 at €60.36, up 6% from €57.17 in 2019.
Ahold, the Dutch company with global food retailing and foodservice operations, finished the year at €23.1, up 4% from €22.3 in 2019, while DSM, the Dutch chemical company with food ingredient interests, increased 21% to €140.8 from €116.1 in 2019.
Corbion finished higher in 2020, rising 64% to €46.15 from €28.12 in 2019.
In Switzerland, Nestle SA, the world’s largest food company, closed at 104.26 Swiss francs, virtually unchanged from 104.78 Swiss francs at the end of 2019. In June, Nestle sold its North American Buitoni pasta business to Brynwood Partners VIII LP. The transaction includes the rights to the Buitoni brand in the United States, Canada and the Caribbean territories. Earlier in the year, Nestle launched Life Cuisine, a new brand designed to “feed modern lifestyles,” the company said. The lineup includes frozen bowls, egg bites and pizzas that cater to four consumer preferences: high-protein, low-carb, meatless and gluten-free.
Aryzta AG closed 2019 at 0.68 Swiss francs, down 37% from 1.082 Swiss francs in 2019 and compared with 38.65 Swiss francs in 2017. It was a rough year for Aryzta, as the company turned over management and battled shareholders over the best course of action to get the company back on track. In December, Aryzta announced it would focus on Europe and Asia-Pacific markets and dispose of businesses in both North America and Latin America. One business the company parted with was the North America take-and-bake pizza business, which was sold to Great Kitchens Food Company, Inc., a newly-formed portfolio company of Greenwich, Connecticut, US-based private equity firm Brynwood Partners VIII LP.
Share price movement in Japan was weaker during 2020. Nisshin Seifun, the Japanese holding company that includes Nisshin Milling, Japan’s largest flour miller, closed at Y1641, down 14% from Y1906 in 2019. The company’s share price had hit a high of Y1977 in mid-February before falling back in mid-March when COVID-19 emerged.
Nippon Flour Mills Co. Ltd. decreased 5% for the year, falling to Y1611 from Y1690, but Nissin Foods Holdings, a leading manufacturer of instant noodles, increased 9% to Y8840 from Y8120.
Baking leaders Yamazaki Baking and First Baking Co. Ltd. were mixed in 2020. Yamazaki closed at Y1724, down 12% from Y1949 in 2019. First Baking, meanwhile, finished at Y987, up 2% from Y967 in 2019.
Olam International, which supplies food and industrial raw materials, finished at 1.53 Singapore dollars, down 15% from 1.81 Singapore dollars in 2019.
Wilmar International increased 13% to 4.65 Singapore dollars from 4.12 Singapore dollars in 2019.
Indonesia’s Indofood, one of the largest food producers in Asia, decreased 14% to R6850 from R7925 in 2019.
South Africa-based Tiger Brands Ltd. fell in 2020, finishing at R20818, down 1% from R21071 in 2019.
Egyptian companies engaged in flour milling were mixed in 2020, led by a 29% increase at South Cairo and Giza Flour Mills. Other increases included North Cairo Flour, up 18%; and Alexandria Flour Mills and Bakeries Co., up 17%. Declines were noted at Middle and West Delta Flour Co., down 27%; Egyptian Starch, down 20%; East Delta Flour Co., down 20%; Upper Egypt Flour, down 16%; and Middle Egypt Flour, down 9%.
In Africa, Flour Mills of Nigeria PLC increased 32% after decreasing 15% in 2019. Flour Mills Nigeria is primarily involved in flour milling, pasta production and cements production.
In Spain, Ebro Foods shares fell 2% to €18.94 from €19.29 in 2019. Riviana Foods, a business unit of Ebro Foods, in December completed the sale of several regional pasta brands to Oak Brook, Illinois, US-based TreeHouse Foods for $242.5 million. The acquisition included the following regional pasta brands: Skinner, No Yolks, American Beauty, Creamette, San Giorgio, Prince and Light ‘n Fluffy, Mrs. Weiss’, New Mill, P&R Procino-Rossi and Wacky Mac, as well as a manufacturing plant in St. Louis, Missouri, US, that employs approximately 90.