Ornua’s PPI drops again for October

Ornua’s Purchase Price Index (PPI) has dropped in the most recent index, according to a statement from the Irish agri-food cooperative.

The dairy exporter’s price index for October is 106.5 – adjusted from 110.4 for September.

This translates to 31.9c/L, VAT inclusive, based on Ornua’s product purchase mix and assumed costs of 6.5p/L.

The October 2018 Index reflects weaker returns, specifically for fat, according to an Ornua spokesperson.

This is the lowest level the PPI has been at since its May price index.

The September PPI came in as the third highest recorded in 2018, behind only January and August in first and second place respectively.

Kerry growth

The announcement comes from Ornua after Kerry Group has announced a 3.5% growth in business volumes for the first nine months of 2018.

Issuing its interim management statement up to September 30, the firm revealed that its Taste and Nutrition division saw growth for 4.1%, while its Consumer Foods department recorded a business volume boost of 1.2%.

Pricing fell marginally by 0.2%, though group trading margin has been maintained, leading to the reaffirmation of the earnings guidance for 2018 in total.

At the end of September, net debt was €1.4 billion, similar to the year end 2017 level.

The group’s consolidated balance sheet “remains strong which will facilitate the continued organic and acquisitive growth of group businesses”, according to Kerry in its report.

The group reaffirms its full year 2018 guidance of adjusted earnings per share growth of 7% to 10% on a constant currency basis.

Commenting on the growth, CEO of Kerry, Edmond Scanlon, said: “We are pleased with our performance to date in 2018, with volume growth well ahead of our markets and underlying margin expansion in line with expectations.”