In the challenging year of 2020, the parent company of milk powder brands such as “meisujia’er” and “Zimu” (hereinafter referred to as “fislan”) has delivered a satisfactory answer in the Chinese market.
In the summary video of 2020 released yesterday, Hein Schumacher, Global CEO of freesland, said: “judging from the performance of the first three months, 2020 is probably one of the strongest years in our recent 10-12 years, and then the impact of the epidemic will come.” He said that freesland’s business was affected by the closure of outdoor channels such as restaurants and Hong Kong ports last year, but the global market has shown signs of stability.
According to the 2020 annual report released yesterday, the annual revenue growth of feishilan group has remained basically stable (Note: adjusted by currency conversion). “In order to prevent the spread of the new coronavirus, some ports between Mainland China and Hong Kong have been closed, and branches in Shanghai, Wuhan and other regions are also facing transportation restrictions. However, due to the great efforts made by colleagues, the annual revenue of freesland China has increased significantly,” simahan said in the financial report
Looking at the above annual report, xiaoshidai noticed that the Dutch dairy giant also talked about the recovery of China’s milk powder business and the outlook for 2021. Now, let’s take a look.
Further increase income in China
For the recovery of China’s milk powder business, fislan attributed it to the more high-end Royal Mercure Jiaer series and e-commerce business.
Referring to Royal Mercure, the company said in its annual report that since the second quarter of last year, China’s infant nutrition market has returned to the pre epidemic level, and royal Mercure has also achieved revenue growth. In addition, by solving the problem of lactoferrin shortage, the brand’s market position has also been significantly improved.
Last year, Royal Mercure’s product matrix continued to expand. According to the annual report, fislan launched two new products in Hong Kong, namely “new royal Mercure” and “Royal Mercure organic”.
Today, freesland China further revealed that as consumers pay more attention to immunity during the epidemic period, this has also driven the market demand for Royal Mercure, which mainly focuses on “high lactoferrin content”. The data showed that the lactoferrin content of Royal minocycline 3 was 450 mg / 100 g. After two years, the sales volume of this series of products has doubled rapidly, and the sales volume has exceeded 2 billion yuan last year.
As for e-commerce, this has become the latest “bet” position of freeslan under the epidemic situation.
Hong Kong, China, has always been an important gateway for the company’s products to the mainland, especially infant nutrition products, freesland said in its annual report. However, due to the closure of Hong Kong port, this affected the revenue and market share of Mercure. “By the end of 2020, we have adopted a new marketing strategy, focusing more on e-commerce.” The company said.
According to xiaoshidai, in the “accelerated transformation” plan released in November last year, freesland disclosed that it plans to seek new market channels to sell infant milk powder from Hong Kong to the mainland market, and stressed that e-commerce and product innovation play an important role.
In early May 2020, Chen Ge, President of fislan China, led the management to visit the stores in Wuhan
In fact, Mercure has made some achievements in cross-border e-commerce channels. Xiaoshidai introduced that in the first half of 2020, the net sales of freeslan China increased by 18%. In the 618 promotion last year, the sales volume of Mercure in general trade channels increased by 90%, while the sales volume of cross-border e-commerce increased by 782% compared with the same period last year.
Looking ahead to 2021, freesland said it expects business in Hong Kong and Mainland China to continue to recover over time. He also said frankly that it is “unrealistic” to expect a full recovery of cross-border trade between Hong Kong and the mainland. Although Hong Kong will still be an important market for freesland, it is less important structurally than before.
“At present, we are committed to formulating a new market strategy in Hong Kong, while the mainland market expects to follow the strategy adopted in 2020 and further increase revenue. China is a highly competitive market, and freesland will be committed to gradual growth. ” The company said.
Feishilan China also said today that based on the strategy of Chinese market, it will pay more attention to e-commerce channels, product innovation and expansion in more offline cities.
The annual revenue is nearly 90 billion yuan
Let’s look at the overall performance of freesland last year.
According to the 2020 annual report of the group, its annual revenue is 11.1 billion euros (about 87.357 billion yuan), which is basically stable after adjustment by currency conversion. Operating profit decreased to 268 million euros (about 2.109 billion yuan), which was affected by the decline of Hong Kong and outdoor channel performance, currency conversion and restructuring costs of 106 million euros.
In terms of sub markets, freesland said that 28 of the group’s 41 markets achieved strategic revenue growth last year. In early 2020, most of its operating companies achieved higher revenues and expanded market share in major consumer markets such as China, the Netherlands, the Philippines, Pakistan and Indonesia.
In terms of business, the performance of the four sectors of freesland is also different.
According to the annual report, in 2020, the revenue of consumer goods, which accounts for the highest proportion of the group’s revenue, dropped to 5.735 billion euros (about 45.134 billion yuan), affected by outdoor activities and adverse currency conversion, but the growth of consumer brands sold through retail channels was strong.
While the income of professional nutrition products where milk powder is located dropped to 1.119 billion euro (about 8.807 billion yuan), due to the continuous closure of ports between Mainland China and Hong Kong, China.
In addition, fislan’s ingredients and bulk dairy business achieved year-on-year growth. Among them, the revenue from ingredients increased by 5.3% to 1.816 billion euro (about 14.292 billion yuan), and the revenue from bulk dairy products increased by 3.4% to 2.467 billion euro (about 19.415 billion yuan).
Looking forward to 2021, simahan predicted in the company’s annual report that the global market will continue to be full of challenges in the first half of the year, as well as for freesland. If vaccination can effectively curb the spread of the epidemic, the economy will grow in the short term.
“I expect that by 2021, the prices of bulk dairy products will rise slightly and steadily. In general, it can be fully expected that everything will move in a positive direction again after the summer of 2021. This hope is also based on the quick response ability of our employees and the company, which I can experience every day. ” Said simahan.