Danisco steps up probiotics presence with European dairy launch

Related tags Danisco Yoghurt

The first dairy food range in Europe containing Danisco's Howaru
probiotics has been introduced in Slovenia by one of the region's
top dairy product manufacturers Ljubljanske Mlekarne.

In addition to the Slovenian market, the licence agreement allows the dairy company to use the Howaru Bifido and Howaru Rhamnosus strains in several of the surrounding countries.

The Howaru strains are already available in dairy foods in Chile and in South Africa, through a range launched by supermarket chain Woolworths. But entry to a European market "is an important step forward for the rollout of our premium probiotic concept",​ said probiotics product manager at Danisco, Siegbert Philipp.

He added: "Woolworths quickly experienced a considerable increase in sales of yoghurt made with Howaru - a success we hope to see repeat itself for Ljubljanske Mlekarne."

The new range, called Kako Si​ ('how are you' in Slovenian), includes fat-free yoghurts, yoghurt drinks and dairy desserts and is being backed by a major marketing campaign involving TV spots, billboard advertising, flyers and a new website.

The Howaru strains have over 20 scientific publications to support their claim to be probiotic, according to Danisco​. However the company is also hoping the 'consumer-friendly name' for its strains will influence its success in Europe's highly competitive probiotics market, currently dominated by major brands Danone and Nestle.

Danny O'Regan, cultures business director at Danisco, recently explained that the firm had adopted a selective approach to marketing the Howaru range, working with only a handful of companies, because of the large number of probiotics on the market, and Danisco's reluctance to cut prices in order to gain competitive edge.

Yesterday Danisco reported full year operating profit for the ingredients and sweeteners segment was down by 10 per cent from DKK1.5 billion (€0.14m) in 2002/03 to DKK954 million in 2003/2004. Sales for the segment were on a par with the year before, DKK8.653 billion compared to DKK 8.651 billion, lifted by a 5 per cent rise in overall sales in the last quarter of the fiscal year.

The company, the world's biggest food ingredients group, also revealed that it intends to launch a 'restructuring programme' in its ingredients and sweeteners business. "After implementation over the next 12 months, annual savings are expected to reach around DKK 75 million. This is on top of the synergies expected from the Rhodia acquisition,"​ the firm said in a statement.

The Rhodia deal, completed this month, will now see cost synergies of DKK150 million according to Danisco, more than previously announced. It will also significantly expand Danisco's cultures range, leading to the creation of a new business division. (Cultures were previously included in the Specialities unit).

While integration of the Rhodia food products is expected to see some product lines disappear, the probiotics range is more likely to be strengthened by the deal, as the Danisco and Rhodia lines currently have little overlap, Fabienne Saadane-Oaks, the new division head, told NutraIngredients.com in a recent interview​.

Europe's probiotics market is set to more than triple in value over the next six years, according to Frost & Sullivan, to reach $137.9 million (€118.5m) in 2010.

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