The last financial year was particularly complicated given that it marked another year impacted by the pandemic. This was in addition to runaway inflation on all costs within the entire scope of VIVESCIA Industries. VIVESCIA Industries has shown great resilience considering this objectively unfavourable context, posting financial results as measured by Ebitda up 9% year-on-year and positive net income. Our total revenue has grown by €460 million, including nearly €430 million of organic growth, reaching a record €2.5 billion over the last financial year. This growth is linked in part to favourable price effects, but also very healthy volume growth. The level of debt is stable compared to last year and fully under control. Indeed, we have relaunched our investment plans with nearly €100 million invested in preparing for the future.

We decided to immediately stop production in our two malting plants there to protect our employees, who we continue to provide financial support for. This conflict led us to record significant provisions for certain Ukrainian assets, such as stocks of raw materials and finished products. Regarding Russia, we are careful to comply with local and international rules.

The return of inflation was clearly noticeable in all our businesses before the conflict began, but the war was a catalyst. From March 2022 onwards, all our costs – energy, raw materials, ingredients, transport and packaging – skyrocketed with, in addition, high price volatility. Our external costs increased by 25% compared with the previous year. That is unprecedented and exceptional.

We used several methods to avoid an impact on our Ebitda this year. First of all, we negotiated targeted price increases with our customers and worked to increase volumes by winning market share. We have continued to work on our consumer range. We have sometimes streamlined our product ranges to simplify production, enable longer production runs, and reduce our costs. And finally, we have pursued our efforts to improve efficiency and optimise our operational processes.

We have seen growth in all our regions except for Asia, due to the repeated lockdowns that harm tourism and have therefore impacted our frozen bakery sales in this part of the world..

Malt sales are practically stable in volume if you ignore the closure of our two plants in Ukraine. This business, which is very sensitive to energy prices due to the necessity to dry the barley, has maintained its profit margins despite inflation. Our frozen bakery business has seen strong volume growth thanks to a return to a more dynamic market, less affected by the pandemic, and market share gains. The same is true for the milling business, in particular food processing customers as well as our iconic flour brand, Francine, which has achieved record market share among French households of more than 37%. The performance of our frozen bakery and milling businesses have improved despite the headwinds of inflation.

The maize processing business, Kalizea, has seen volume growth thanks to good results in Romania, but Ebitda is down due to the slight delay in passing on price increases to our customers, with whom we often have annual contracts. Our animal nutrition business is suffering due to inflation in plant ingredients, especially for cattle and poultry feed. In addition to this, high levels of rainfall during the summer of 2021 means farmers have abundant fodder and don’t need to buy as much feed. And finally, ARD has posted good revenue growth and Ebitda. Both a project incubator and innovation accelerator, this business operates on a buoyant segment (industrial biotechnologies, plant fractionation, and plant chemistry). These are high-potential markets, and our teams boast world-renowned expertise. Furthermore, ARD can manage the entire process from laboratory trials to industrial scale-up with contract manufacturing solutions. In short, we help our customers get from the test tube to large-scale production. By the spring of 2023, we will have completed works to increase our production capacity, which is reaching saturation.

We obviously don’t have much visibility regarding our industry – much like the economy as a whole. Price increases will have to continue, but the impact on consumption remains uncertain – this is an unknown factor. The directors of our various businesses are working hard with their teams and monitoring our markets closely. I would like to take this opportunity to pay tribute to them and hail their incredible endurance. In any case, we will continue to move forward and invest so that we can make the most of the recovery when it comes. All our transformation plans and aims to win market share are now more than ever done in line with our “LINK” sustainable development policy and our climate strategy, which will be finalised during the current financial year.