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Arnott’s plots to become ‘regional powerhouse’ of consumer brands

Arnott’s sold more than 270 million Tim Tam biscuits during the last year.

Arnott’s says it plans to build a “regional powerhouse of consumer brands” based in and run from Australia. 

The FMCG company has reported what it describes as its strongest financial performance in years, just nine months after it was bought by private equity investment firm KKR – and even adopted a new slimline corporate logo for inhouse use only to signify change to staff and stakeholders. (The company says the new logo will not be consumer facing or replace its existing branding which has been used since 1997). 

Arnott’s Group’s new internal logo, which will not be appearing on products.

“We have a fantastic legacy, a strong business and a plan for growth by building a world-leading group of businesses from right here in Australia,” said Arnott’s Group CEO George Zoghbi.

“A big part of our strategy will be investing in our people and products while minimising our environmental impact and supporting the communities in which we operate.”

The company says lockdowns in its core Australian and New Zealand markets helped boost sales in the second half of its fiscal year as consumers snacked and cooked at home more.

Some 4 million additional packets of chocolate biscuits, 2 million cans of soup, 2.7 million packets of stocks and 1 million more cans of V8 juice were sold during the lockdowns. 

Overall sales rose by 6 per cent in the year to June 30 with growing exports to Malaysia, Japan and Hong Kong adding to improved performance in Australasia. 

But the Covid-19 crisis brought additional expenses, with production costs rising by 6 per cent over the full year due to supply-chain constraints. 

As a privately owned company Arnott’s did not reveal details of its profitability or operating results across different divisions. But the company did highlight a $66 million investment in new infrastructure, including the construction of a 1.6ha warehouse in Huntingwood in Sydney’s west, due for completion early next year. 

Three-year plan

Meanwhile, Arnott’s regional expansion plan is plotted over three years, covering key markets in Asia Pacific led by what the company describes as “a Tim Tam takeover”, focused on increasing sales of snacks, biscuits, soups and meals in various markets.

“In Australia and New Zealand, our focus will be on growth in our existing biscuits business, delivering an efficient meals and beverages business and addressing gaps in key snack food categories.”

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