This week in FMCG
The first week of December saw some big headlines, as 2018 draws to a close. Here’s a look back at what happened this week.
Coca-Cola Amatil (CCA) has ceased production at Thebarton in South Australia after it became increasingly constrained and no longer suitable for modernisation. Bottling at Thebarton was relocated to the expanded Amatil facilities in Western Australia and Queensland. It began creating the century-old ‘contour’ bottle in 1952 and was the sole bottler in Australia for Powerade and Jim Beam. CCA general manager for Sales, Jarrad Mortimer said CCA worked closely with all employees over the two year transition period, to help them find new work or be redeployed elsewhere.
Food and grocery wholesaler Metcash has reported a 3 per cent net profit increase for the first six months of 2018 to $95.8 million. Metcash Group CEO Jeff Adams said that “the first half results were pleasing in the face of challenging market conditions, with the Group delivering improved sales and earnings.” Sales revenue rose by 2.2 per cent to $6.19 billion due to the rise of its food and hardware business. It also announced a long-term lease for a new purpose built distribution centre in South Australia.
Australian law now requires businesses with turnovers of more than A$100 million to publish annual reports on how they are addressing modern slavery in their operations. Daniel Baker, ALDI Australia’s corporate responsibility director, said the laws play an important role in creating awareness. Most of the discount grocer’s suppliers are based in Australia but its supply chain is “diverse” and some of its products are manufactured off shore. The supermarket is working closely with suppliers to tackle issues such as forced labour and labour trafficking.
Procter & Gamble (P&G) has acquired Merck’s Consumer Health in Darmstadt, Germany. The FMCG giant said the acquisition will see the introduction of new OTC products for muscle, joint and back pains; colds and headaches; including products for supporting physical activity and mobility. It also expanded the multinational’s health care commercial and supply capabilities, technical mastery and consumer health care leadership. Tom Finn, president, P&G Global Personal Health Care said it marked the beginning of an exciting new era for P&G Personal Health Care.
The Federal Court has fined the former Murray Goulburn managing director, Gary Helou, $200,000 for false claims on the farmgate milk price it expected to pay dairy farmers during the 2015-16 milk season. He admitted his involvement in the misleading representations made by Murray Goulburn, including not informing farmers of risks known to the dairy giant and making unfounded assumptions that the co-operative could achieve its milk powder sachet sales targets. ACCC deputy chair Mick Keogh said the penalty reflected on “his seniority at Murray Goulburn and involvement in misleading representations about the farmgate milk price.”
Multinational FMCG giant Unilever has acquired GlaxoSmithKline’s Health Food Drinks portfolio, including malt drinks Horlicks. This will boost Unilever’s position in India. Nitin Paranjpe, president, Food & Refreshment, Unilever, said. Nitin Paranjpe, president, Food & Refreshment, Unilever, said that the company’s latest deal is “transformative for our Foods and Refreshment business allowing us to enter the Health Foods Drinks category, further strengthening our position in health and wellness.”
UK’s supermarket Tesco’s former directors were acquitted this week of fraud and false accounting. Tesco’s former managing director, Christopher Bush, and former food commercial director, John Scouler, were accused in 2014 of supporting the grocery’s share price and securing huge compensation packages. UK’s Serious Fraud Office (SFO) filed a case against Tesco after the overstatement of its profit forecasts more than $318 million in 2014. Judge John Royce announced at London’s Southwark Crown Court that the former officials were acquitted by the Court of Appeal on Wednesday. He said the Court of Appeal concluded that his judgment at the mid-trial showed that the defendants had no case to answer was correct and refused the SFO permission to appeal.
That’s it for this week in the FMCG sector. Have a good weekend everyone!