Strauss to market hummus worldwide
Israeli food maker setting up international company with PepsiCo to sell salads and dips in Canada, Mexico and other countries
Strauss reported a 19% drop in its operational profit in the fourth quarter to NIS 103 million ($29 million), and a 5% decrease in its net profit due to the increase in coffee prices worldwide, Strauss' investments in China, Russia and Britain, and the rise in corporate tax in the countries it operates worldwide.
"There is hardly any raw material whose price has not gone up," said Strauss Group President and CEO Gadi Lesin. "Coffee in all colors and varieties has doubled its price. The price of oil – which went up – affects the price of plastic, the grain – which is the cow's food, and therefore milk and meat prices as well."
Therefore, it is quite possible that the prices of the company's coffee, dairy products, salads and water devices will rise in the near future.
"Almost every category has been influenced by the rising prices," said Lesin. "No company can deal with an increase in the prices of raw materials without raising prices. So the prices have gone up, are going up and will go up. But until Passover we'll maintain the current consumer prices. We're raising prices only as a last resort."
Hummus for North America
Nonetheless, the company's investments in the world will continue in 2011. Strauss plans to set up together with PepsiCo an enterprise which will sell hummus, dips and salad in the world.
The two companies are already collaborating in the American Sabra factory, and they plan to establish a company with joint and equal ownership, which will market similar products, first in Canada and Mexico and then in other countries. Giyora Bar-Dea, CEO of Strauss-North America, will be appointed as the company's CEO.
Strauss has managed to infiltrate 10% of US households with Sabra salads. "We will use the knowledge and experience we have accumulated with the Sabra company in the new company we plan to establish with PepsiCo," said Strauss Chairwoman Ofra Strauss.
The company's income in the fourth quarter of 2010 totaled NIS 1.81 billion ($510 million), a 5.4% rise compared to NIS 1.71 billion ($480 million) in the same quarter the previous year.
Annual sales totaled NIS 6.85 billion ($1.93 billion) – a 7.5% rise compared to 2009, with a 9.1% rise in gross profit, 5.4% in operational profit and a 3.9% drop in gross profit – NIS 211 million ($60 million) compared to NIS 230 million ($65 million) in 2009.
Ofra Strauss earned NIS 2.981 million ($840,000) in 2010, with NIS 2.521 million ($710,000) in wages cost. Gadi Lesin earned NIS 9.24 million ($2.6 million), with NIS 2.416 million ($680,000) constituting the wages cost and NIS 6.364 million ($1.8 million) in stock-based payments.
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