Ebro Foods expects inflation to increase 2022 operating costs by $63m

MADRID, April 27 (Reuters) – Spanish company Ebro Foods expects accelerating inflation to push 2022 operating costs up 60 million euros ($63 million) more than forecast, largely due to a strike. of transport in Spain and the invasion of Russia in the Ukraine.

As wheat and energy costs have soared in recent weeks following the Russian invasion, the owner of brands including Tilda rice and Garofalo pasta said on Wednesday it estimates operating costs of 234.4 million euros in 2022. .

Ebro Foods said it has no exposure to Russia or Ukraine, but the war has had “considerable collateral impacts”, mainly in new waves of cost inflation for raw and auxiliary materials, transport, energy and labor costs.

He also mentioned a transport strike in Spain in March, which broke out in response to rising fuel costs and caused massive traffic jams across the country, prompting some factories to stop production as they could not guarantee deliveries would be received. on time.

“(The strike) had an impact on shelf inventory as consumers have been buying certain products and brands in bulk, while other products were out of stock as they could not be delivered to our customers on time or correctly.” Ebro said in a presentation of results.

Ebro Foods’ first quarter net profit fell 21.4% after posting a strong gain from the sale of its North American pasta business in the same period last year.

Profit from continuing operations increased by 14.5% to €41.5 million in the same period. (1 US dollar = 0.9495 euros) (Reporting by Emma Pinedo; edited in Spanish by Benjamín Mejías Valencia)

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