May 26, 2022

French poultry firm LDC to boost plant-based foods in growth strategy

LDC, France's largest poultry company, said that it plans to more than triple its plant-based product volumes by 2026 and is open to acquisitions in the sector as part of its strategy to improve profitability by 40% in the next four years, Reuters reported.

In recent years, the market for plant-based foods has exploded, garnering significant investment from big agrifood companies such as Nestle, PepsiCo, and Archer Daniels Midland, all seeking to profit from a trend toward better eating.

Philippe Gelin, LDC's new chief executive, said the company's goal is to accompany the flexitarian movement with the goal of reaching 10,000 tonnes of products (from 3,000 tonnes today) by 2026, with sales of EUR 60 million euros (~US$64 million; EUR 1 = US$1.07).

He said the firm is open to any prospects for external expansion.

Plant-based meat will, however, remain a minor component of LDC, which focuses mostly on fresh poultry and ready-to-eat meals.

The company, which had revenues of EUR 5.1 billion (~US$5.4 billion) in 2021/22, up 14.5% year-on-year, wants to reach EUR 7 billion (~US$7.4 billion) by 2026, with EBITDA of EUR 560 million (~US$599 million).

Gelin declined to provide advice for the fiscal year 2022/23, citing too many unknowns, both in terms of volumes and pricing, at this time.

Due to France's worst-ever avian flu epidemic, LDC predicts a 12-15% drop in group poultry output from March to August.

Gelin said the company still needs to pass on a considerable amount of the higher costs it is suffering to consumers as a result of the recent increase in the price of grains, which make up the majority of the diet of chickens.

-      Reuters