CEE economies and expensive hazelnuts hurt Manner

Central and Eastern European (CEE) economies in trouble and expensive hazelnuts are hurting Viennese sweets producer Manner financially.The firm reported today (Weds) that its turnover declined by 6.7 per cent year on year to 35.8 million Euros in the first quarter of 2010. Turnover declined substantially in Slovenia, Hungary and Croatia and also fell in Austria.Manner said it had compensated by cutting personnel costs by laying off 10.2 per cent of its employees to 715 in the first quarter and noted that some of the decline in turnover had been the result of “strategic decisions” it had made.The firm said that it could not exclude the possibility of additional lay-offs if its results continued to be bad.Manner also noted that the percentage of its products exported abroad had risen from 57.7 per cent in the first quarter of 2009 to 58.4 per cent in the same period this year.The firm added that it believed that the prices of its raw materials, particularly cacao, would continue to rise in 2010. It said it would compensate for that trend with new products and stronger marketing activity.Manner had earlier reported that its 2009 turnover had fallen owing in part to “massive price hikes” for cocoa beans.The firm said turnover had dropped by 7.6 per cent to 155.4 million Euros year on year in 2009.”Temporarily decreased prices for sugar, flour, milk products, vegetable fat and hazelnuts dominated circumstances, as well as a 25-per-cent rise of cocoa bean prices,” a spokesman said.While turnover slumped, Manner managed to improve its earnings before interest and taxes (Ebit) from 4.6 million Euros in 2008 to seven million Euros last year.Manner laid off 48 employees last year as demand for its products declined in Austria, Germany and Eastern Europe.The company, which was founded in 1890, produces most of its waffles and chocolates abroad.