2023-05-03 02:13:38
-Last year was difficult from an economic point of view. How did Ferrero Ibérica do?
The difficulties have been real for all of society and the entire business system. Despite them, our group has followed its roadmap, which plans to continue growing both at the level of geographical expansion and through acquisitions. We recently approved the annual accounts for the year ending on August 31, 2022 with a consolidated turnover of 14,000 million euros, which represents an increase of 10.4% compared to the previous year. At Ferrero International we have 109 companies and 32 manufacturing plants around the world, selling directly and through distributors in more than 170 countries. We employ more than 41,000 people around the world. Ferrero Ibérica, in a turbulent macroeconomic context, has been able to consolidate its leadership thanks to a management policy in keeping with the situation, the determination and perseverance of our team, the size and quality of our brands and our business model. We have closed the year with a turnover of 289 million, which represents an increase of 6.2% compared to the previous year.
– Was the fact of being part of a segment such as impulse purchases noticeable at a time of high inflation and in which buyers look more closely at what they spend on food?
It must be said that the candy market in general terms has an anticyclical behavior. In difficult times, people are more willing to be self-indulgent. We must bear in mind that the frequency of consumption of this type of product is quite sporadic. It is true, in any case, that in an inflationary context, consumers control their expenses more and this has determined a stability of the general volumes of the entire confectionery sector. Faced with this stability, at Ferrero we have consolidated our leadership and our size, as I had been saying. At the end of the year, we have strengthened our position as leader in the national confectionary market (chocolate-based products) with a global market share of 16.2%, leading market segments such as chocolates, where our flagship brands Ferrero Rocher, Mon Chéri and Raffaello have a market share of 26.5%. In the chocolate snacks segment, where we compete among other brands with Kinder Bueno, we continue to be absolute leaders with a share of 33.1%. Kinder Sorpresa and Kinder Joy give us another absolute leadership in the novelties market with a market share of 46.5%. Ferrero also stands out for its presence with relevant market shares in the segment of spreads with Nutella. Likewise, in 2022 we have carried out significant launches in the biscuit market, with Kinder Cards and Nutella Biscuits; and we have successfully entered the ice cream segment with the Raffaello and Ferrero Rocher brands, to which we recently added the launches of the new Kinder Bueno and Pocket Coffee ice creams.
– To what extent is the increase in the cost of raw materials such as sugar affected the firm?
Sugar is just one of the raw materials that we use in our products and that have increased. And a lot: cocoa, hazelnut and milk have registered double-digit increases, as well as energy and fuel costs. Clearly, this affects the cost structure. Faced with this type of situation, the only solution is to optimize our resources to the maximum, systematically analyzing our processes to detect any possibility that allows improvement. Applying careful management is the only solution to avoid transferring the full effect of rising costs to the final consumer, and we have done so. It is true that we have had to raise the final prices of our products, but in a much smaller way compared to inflation levels.
– Have initiatives such as the one announced by Consumption to prohibit the advertising of high-sugar foods and beverages aimed at children affected the company?
At Ferrero, we have been pioneers of what is known today as responsible marketing. Having to manage a brand like Kinder, which has an impact on families with children, we have had the ethical need to place clear limitations on both the content and the language and scope of our messages. Any type of regulation that seeks to set limits will not affect us excessively. As a member of the International Food and Beverage Alliance (IFBA), at Ferrero we are committed to self-regulation and the application of the “Framework for responsible communications in the marketing of food and beverages” approved by the International Chamber of Commerce (ICC), as well as compliance with the pertinent regional and national self-regulatory codes. We are also a member of the World Federation of Advertisers (WFA), an international organization that promotes correct and efficient practices in relation to responsible advertising. At the EU level, at Ferrero we are a founding member of the EU Pledge or EU Commitment, which is why it undertakes to avoid communications directed at children under 13 years of age. There is a whole series of highly articulated self-regulation standards to which a large part of the companies adhere, which leads me to think that there is neither urgency nor need to have a specific law.
– What perspectives do you have for this exercise?
Making forecasts for this year is complicated. The macroeconomic situation is complex and the effects of the war between Russia and Ukraine continue to generate tension at the industrial level both due to the costs of energy and raw materials and the availability of the latter. It is true that in recent months there have been some positive signs of a drop in inflation and a reactivation of demand, a fact that may somehow improve current expectations. For our part, there is a duty to continue to maintain maximum concentration and improve the efficiency of all business functions, as well as our ability to react to situations of high volatility.
– At what point are you in your goal that all your packaging is recyclable and reusable by 2025?
We continue to make progress in our sustainability strategy regarding the circularity of our packaging. We committed to 100% of our packaging being reusable, recyclable or compostable by 2025, reaching a maximum of 83% of it already in 2021. On the other hand, we are already immersed in the eco design culture, which will allow us to have in the near future the ability to design containers and packaging with minimal or no impact. We still have a way to go, but each time we see ourselves closer to reaching the goal set.
-What strategies has the company followed and will continue to achieve this?
To achieve these objectives, at Grupo Ferrero we focus on four key areas. The development and redesign of existing packaging, R&D in Innovation, partnership with national waste management institutions and consumer education to complete a successful transition towards a circular economy and actions to eliminate waste. Within the framework of our commitment to the circularity of packaging, at Grupo Ferrero we have joined forces with suppliers, recycling companies and industry leaders. In this sense, the company has signed the Ellen MacArthur Foundation’s Global Commitment for the New Plastic Economy, a step forward in our ambition to play an active role in the elimination of single-use plastic packaging through of its redesign and innovation.
– Do these types of strategies, sustainability in general, give companies revenue? Are they a self-demand or a consumer-driven trend?
We believe that sustainability, beyond the revenue it can give to companies, is a requirement of all of society, companies included. Our duty is to intensify our commitment to reduce carbon emissions and prevent climate change from continuing to advance. We should not be part of the problem but be active and proactive actors of the necessary and pertinent solutions. In this sense, our approach is based on self-demanding a firm commitment to sustainability that requires us to continue in this direction regardless of consumer-driven trends. That is why we have proactively anticipated all the corrective measures necessary to comply with the new regulatory frameworks.
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