The Australian FMCG industry had big news this week. Rival supermarkets made headlines as one of them decided to spin off their grocery store; Dairy giant chief resigned from company right after major profit loss and rockmelon listeria outbreak death rate rose.
Will Coles lag behind Woolies?
Analysts said the supermarket Coles might take the second lead after Woolworths, which may happen after its parent company Wesfarmers decided to spin off the grocery as a separate ASX-listed company.
UBS analyst said Coles will face higher capital expenditure and costs as a stand-alone business which will weigh on its earnings. Shares in Wesfarmers rallied after the announcement. The retail giant wants to retain as much as 20 per cent of the new, publicly listed Coles business. Analysts said it may be worth about $18 billion, while keeping Bunnings, Kmart, Target, Officeworks and its industrial businesses. We’re keeping tabs on how this story will turn out for the supermarket giant.
Fonterra chief resigns after $348m profit loss
Dairy giant Fonterra CEO Theo Spierings has decided to step down later this year. He led the company for seven years. Currently, the dairy business is now shortlisting candidates after it began the search for new candidates last year.
The big news came after Fonterra announced it has slashed $405 million off the value of its investment in Beingmate Baby Child Food. AAP said the writedown – and a $183m settlement with Danone – led to a first-half loss. The net loss was $348 million in the six months ended January 31, from a profit of $418m a year earlier. Certainly a lot of big news has rocked the dairy giant this week.
Rockmelon listeria death toll rose
The rockmelon listeria outbreak in Australia continued as an elderly NSW woman became the sixth Australian to die. NSW Health said the 90-year-old woman had significant underlying health conditions too. Three Victorians and three people from NSW have now died as a result of the outbreak which was first revealed in February. Nineteen people were also infected during the outbreak.
Rombola Family Farms also voluntarily halted production of potentially contaminated melon types. All affected produce has been withdrawn from sale and distribution.
Enjoy the weekend!
