News briefs: Campbell, StarLink corn and Ebro

By Laura Crowley

- Last updated on GMT

Related tags Food Campbell soup company

This week, Campbell announced a series of strategic moves designed
to improve efficiency and profitability, the FDA withdrew its
guidance for testing StarLink yellow corn, and Ebro Puleva's
profits have increased in Q1.

Campbellfocuses on core business to improve future finances ​Campbell Soup Company is to close its Ontario food plant, exit the snack foods business in Australia and discontinue its private label biscuit and industrial chocolate production there to "improve operational efficiency and enhance long-term profitability"​. The global manufacturer of products including soup, baked snacks, and healthy beverages said it anticipates it will incur costs of $230m (€148m) as a result of the initiatives, which will mostly effect the third and fourth quarters of this year. However, the company said positive effects on the earning and cash flow should be achieved from the start of fiscal year 2009. Douglas Conant, Campbell's president and chief executive officer, said, "Through a relentless focus on our core businesses of simple meals, baked snacks and healthy beverages and by eliminating inefficiencies in our portfolio and operations, we will be able to meet the needs of customers and consumers faster, better and more completely than the competition." ​The Canadian food plant in Ontario that will be closed primarily produces frozen products such as soup and noodles. Campbell intends to continue production there for a further 12 months and then transfer production to its network of North American contract manufacturers as well as its Pennsylvania plant. Meanwhile down under, Campbell has entered into an agreement to sell its Australian snack foods business to investors, including senior management of The Real McCoy snacks food company. The transaction includes the sale of brands such as Cheezels and Kettle Chips as well as two production plants in Australia that currently produce snack foods. Campbell expects to complete the transaction in the fourth quarter of fiscal 2008. Additionally, subject to union consultation, the company will discontinue its private label biscuit and industrial chocolate production at its Miranda facility in Australia. FDA ceases testing of yellow corn for Cry9C protein ​The US Food and Drug Administration (FDA) concluded Cry9C protein is no longer present in StarLink yellow corn and dry-milled yellow corn, and has withdrawn its testing guidelines. StarLink corn was found to contain Cry9C, a unique protein designed to repel the corn borer pest, in 2000, sparking a massive food recall and disrupting export markets. The corn variety was not approved for human consumption in the United States because of concerns it might trigger allergic reactions but was allowed for use as animal feed. Since then, the Environmental Protection Agency, the FDA and the US Department of Agriculture (USDA) have tested millions of corn samples. Last week, the FDA announced the withdrawal of its document drawn up in 2000,​ entitled, "FDA Recommendations for sampling and testing yellow corn and dry-milled yellow corn shipments intended for human food use for Cry9C protein residues"​. ​The FDA concluded the product now carriess no allergic risk, saying: "The protein has been sufficiently removed from the human food supply to render the level of risk low enough that continued testing for the protein in yellow corn at dry mills and mass production facilities provides no added public heath protection.​" Ebro Puleva announces growth in Q1 ​Spanish ingredients company Ebro Puleva has announced a first quarter net profit of €29.3m, up slightly from 2007 as a result of increased focus on its core businesses. The firm said it achieved a turnover of more than €717m, representing a year-on-year growth of 10 per cent. However, its EBITDA dropped 2 per cent to €73m as a result of the depreciation of the dollar and an increased advertising campaign. The pasta division had a successful quarter, with new product launches and a stable raw material market contributing to increased market shares. Ebro reported a €230.6m turnover in this division, helped by the recently incorporated German pasta firm Birkel, which contributed €26.4m to the turnover. The company's rice division experienced EBITDA growth of 21.2 per cent to €25m, with a turnover of €206.2m. The company also announced this week it is to sell or spin off its sugar division so it can focus more on its core businesses, particularly its durum wheat segment.

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