Swiss food and beverage company Orior plans to divest certain assets of Albert Spiess to the local animal protein processor, Mérat.
Today, during a trading update for 2024, Orior disclosed this strategic plan along with details surrounding a “valuation discrepancy” previously communicated in February.
This inventory discrepancy specifically pertains to Orior’s dried meats subsidiary, Albert Spiess, as part of the ongoing review of the Orior group’s business framework.
In its strategic deliberations, Albert Spiess AG has opted to concentrate on its core business, focusing on producing Graubünden dried meat specialties.
Consequently, a new home has been secured for its gastronomy depots located in Landquart and Davos. Mérat AG is set to acquire both depots from Albert Spiess effective 1 April 2025, along with the corresponding business and all 15 employees, the company confirmed in the update today.
In light of new findings, Orior anticipates recording an impairment charge ranging from SFr10–12m ($11.2m to $13.5m) at Albert Spiess, which will “affect neither cash nor EBITDA.”
The inventory discrepancy was identified as totaling SFr10m, impacting EBITDA but not cash, with SFr2–4m related to the 2023 financial year.
“Full details, including the origin of, and responsibility for this, are being analyzed,” the company stated.
In another significant update, Orior announced in December that plans for a new “hub” at its Oberentfelden facility would no longer proceed. Today, they provided additional insights.
The company indicated that previously communicated adjustments to its accounts, amounting to SFr8m regarding that discontinued project, are likely to impact EBITDA—specifically SFr2-4m to be reclassified for the 2023 fiscal year and SFr4-6m for 2024.
“A sales process has also been initiated for the annex building at the Oberentfelden site, which is not utilized for operational purposes,” Orior announced today.
Additionally, another Orior site is scheduled for sale in Olen, Belgium, following the termination of a significant volume contract with a foreign customer in Belgium.
Orior explained, “A mutual and more considerate interim solution has now been agreed with the customer for part of the volume.”
“To mitigate the impact of the first tranche of the reduction, expected at the end of 2025, the closure of the small plant in Olen, Belgium, is set to proceed.”
Orior also estimates a currency-adjusted organic growth of 0.5% for 2024, an improvement from previous expectations of a decline.
Nevertheless, financial adjustments have necessitated a downward revision of the company’s EBITDA margin.
Orior now estimates a margin between 3.2% to 3.7%, a decrease from the earlier projected range of 5% to 5.3%. Furthermore, excluding one-off effects, the adjusted EBITDA margin is projected at 6% to 6.5%, down from a prior estimate of 8% to 8.3%.
In light of the reclassification of plant development costs, Orior has revised its 2024 capital expenditure forecast to SFr37m–SFr39m, down from the previous SFr41m–SFr43m.
Consequently, Orior’s board of directors will propose suspending dividend payments for 2024 at the forthcoming annual general meeting. The final results for the previous year are scheduled for release on 2 April.
Looking ahead, Orior asserted that its “core business remains robust, and various positive factors for the future have been confirmed.”
Casualfood, its travel catering and foodservice subsidiary, has secured two major European contracts, winning rights to operate nine new airport outlets for an average term of eight years.
The inaugural locations are anticipated to commence operations in early 2026.
Moreover, Culinor, focusing on ready-made meals, acquired a significant cross-border foodservice contract, while Fredag, a provider of protein-based meal solutions, achieved a large foodservice order that strengthens sales in the convenience sector.
However, non-recurring factors are expected to negatively impact 2025 sales, including the partial termination of a significant Culinor contract, the discontinuation of sales from Albert Spiess depots, and repercussions from lost tenders in 2024.
As a result, Orior anticipates a mid-single-digit percentage decline in sales for 2025.
Despite these challenges, the company projects a stable EBITDA margin, aligning with its adjusted EBITDA margin update for 2024.
