The Dutch company Greenyard has strengthened its relative market position in the last six months. That is despite "unprecedented macro-economic and geopolitical unrest," co-CEO Marc Zwaaneveld said at a press event explaining the published half-year results. He further called on the Dutch and Belgian governments to reduce VAT on fruits and vegetables to zero percent as soon as possible.
"There's nothing to discuss. Have some political guts and introduce it." Marc says deciding which product groups would be covered can be hashed out later. "That needs to be discussed, but they shouldn't get bogged down now in what should or shouldn't be included. The unprocessed fruits and vegetables situation seems to be well known," he adds.
"I urge the Netherlands and Belgium to reduce the VAT on these product groups to zero percent. Now. Fresh fruits and vegetables are healthy, and their consumption benefits the climate more than processed fruit and vegetable consumption. Don't keep arguing because some multinationals would like to see the regulations include their products too. You can always consider that later."
Co-CEO Hein Deprez was not at the press conference but stated this in a press release about the results: "Current economic conditions mean average fruit and vegetable consumption per person remains well below the minimum WHO recommended 400 g/day. Today we truly have unique momentum to fully utilize fruit and vegetables' pure power."
"Favorable policy priorities and strategies are being taken and rolled out. These highlight this healthiest, most sustainable food category's essential role. Plus, fruits and vegetables have a limited impact on purchasing power. Inflation barely affects people buying these products. This, more than ever, is the time to increase fruit and vegetable consumption. For people and the planet's sake."
Improved relative position
Greenyard has strengthened its market position in the past six months. "War, high inflation, and turmoil throughout the chain - at growers, the industry, and end customers - characterize these extraordinary times. At the European level, the market's total volume fell by ten percent; at Greenyard, that was three percent, so the decline was limited. The group's Fresh segment market share even grew. Volumes also increased in the Long Fresh segment in the first half of the 2022-2023 fiscal year," continues Marc.
The company indicates it is standing firm in a tough market. Greenyard's sales increased by 7.3% over last year to nearly €2.3 billion. Fresh product sales grew by 5.9%, and frozen product sales by 14.5%. Net profit from continuing operations did decrease slightly. It was €7.1 million compared to €8.5 million a year ago. But, net debt fell to €328.4 million. For the same period last year, that was €338.1 million.
"High inflation and high energy, transportation, and labor costs all weigh heavily on the sector." Greenyard cannot yet entirely pass on the cost increases. "Still, ongoing profitability and market share increases are crucial for continued growth," Marc continues.
"There will come a time when calm will return; then our new market position will benefit us." Does the company intend to resume dividend payments? "We'll discuss that further at the end of the financial year. It's too early to say anything about that, but we're absolutely reconsidering it," he says.
Possible fresh produce shortages
Greenyard, thus, looks to the future with confidence. "The current economy and geopolitical climate make giving a clear outlook hard, but in the short term, we're confident that we've shown that our company's solid. Long-term growth depends on the global situation. A world where a shift to private brands and zero percent VAT will benefit Greenyard."
Still, there are daunting challenges. "Plenty, obviously, needs to be done regarding product availability. However, regarding Longfresh, there's no discussion about availability," says Marc. "As for Fresh, it's a little tougher. We'll always keep supporting regional cultivation, but the fact is, there could be a shortage of certain local products."
"We have options on site then, but our customers may have to make choices. A product might be less available at certain times of the year, or they may have to opt for cheaper products. Generally, however, we won't have any supply issues. We're convinced that our way of working and transparency will let us maintain this position," Marc concludes.
You can read the complete half-year results for the Greenyard Group here.
For more information:
Greenyard
Website: www.greenyard.group