Decreased demand for natural & organic food ingredients in 2009 led to a 6% decline in sales for SunOpta Inc. The Canada-based natural & organic food supply company generated sales of $989.1 million for the year, which was down from $1.1 billion in 2008. “The economy has had an impact, there is no doubt about that,” Chief Operating Officer Tony Taveres told Nutrition Business Journal. The company experienced varying results from different sales channels in 2009. “We’ve had some items which have seen growth in Club stores, but in traditional mass market retail they’ve had a bit of a tougher time,” said Taveres. SunOpta showed signs of rebounding in Q4 with sales totals slightly above 2008 earnings. The ingredients division achieved record profit margins of 17.8% during the fourth quarter.
The company is looking forward to a return to profitability in 2010, according to a statement issued by President and CEO Steve Bromley. “In 2008 and 2009 we were trying to—I don’t want to say survive—but we were trying to get a grip on the business. They were digestive years,” said Taveres. “Going into 2010, we’re going to be a lot more capable of taking on acquisitions.”
NBJ Bottom Line
SunOpta was one of the victims of the “de-stocking” effect that impacted all ends of the food supply chain in 2009. Consumers cleaned out their pantries, distributors ordered fewer products, retailers reduced inventory and suppliers like SunOpta saw their order sizes shrink. Still, with a virtual 50/50 split between natural and organic food offerings and vertical integration that allows the company to leverage its vast supply chain, SunOpta remains very well positioned in the natural & organic food supply chain despite its 2009 performance. According to Taveres, the company has already identified potential acquisition partners in each of its operating segments and is poised to grow the business via strategic acquisitions in the coming years. More can be found on SunOpta and the state of the organic foods industry in NBJ’s upcoming March issue. To subscribe or order a free sample issue, visit NBJ’s subscriber page.
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