New ‘Captain Iglo’

May 15, 2013, 10:24 am

Iglo Foods Group, Europe’s largest frozen foods business, announced on Wednesday the appointment of Elio Leoni Sceti as its new chief executive, with effect from May 23, 2013.

Leoni Sceti, has over 20 years of experience in the FMCG and media sectors. He served as CEO of EMI Music until 2010, while the company was under private equity ownership.

He will succeed Martin Glenn, who took over as CEO when Permira bought the company, known for its Captain Iglo and Captain Birds Eye fish finger branding, from Unilever in 2006. Glenn was rewarded well for his six years of hard work, taking home €4.4 million last year, up 310% year-on-year, after getting a payment from the refinancing of the business.

Undercurrent News sources see the job as a tricky one, with Iglo coming under increased competition.

Prior to EMI,  Leoni Sceti held senior leadership roles at Procter & Gamble and Reckitt Benckiser, where interim CEO and Iglo Group chairman Erhard Schoewel worked for many years.

Schoewel will revert back to his position as non-executive chairman of the company, which had a tough year in 2012.

“I am delighted to welcome Elio to Iglo Group," said Schoewel, who took over as interim CEO after Glenn left.

"He has an impressive record of encouraging innovation and accelerating top line growth at world class consumer businesses and brands. Specifically, Elio managed and extended an innovation machine at Reckitt Benckiser. From many years of working together at Reckitt Benckiser I know that he has the right credentials for the job."

The Iglo Group board believes the frozen food category has huge potential for significant growth and to this end has agreed to invest in the business at "record levels", he said.

"We believe Elio’s experience and track record will lead Iglo Group to realise its growth ambitions in existing and new markets.”

Leoni Sceti said "leading brands that command consumer loyalty and thrive on innovation will always outperform and I believe the group’s brands have the perfect profile to do so. I look forward to working with the team to build on the company’s strong position and finding exciting new avenues for growth".

Leoni Sceti is currently chairman of Zeebox, the leading second screen platform and since 2010 has built a portfolio of early stage social/web technology companies.

He is also an advisor to the board of Anheuser-Bush Inbev, the leading global brewer, and he is a counsellor at One Young World, the global forum of future leaders.

Tough 2012 

The fierce competition affecting Germany’s fish processing market has not spared Iglo Group.

The company said sales of its core category products — ie. fish, vegetable and poultry — in Germany fell by 1.5% in 2012, in its annual report.

In comparison, sales of those products in the UK rose 2.1%, while in France they recorded ”strong double-digit” growth driven by coated fish and recipe fish.

Core sales overall for Iglo, which operates in a range of European countries including Russia, Italy, Austria and Portugal, were only marginally up 0.4%.

Germany “was particularly hard hit by the price decreases from discounters and increasing private label pressure”, said Achim Eichenlaub, managing director of Iglo’s continental Europe division.

In Germany, the arrival of a new player in the frozen fish sector, The Seafood Traders, has made an already tough environment in private label supply even tougher. This has served to bring down the prices for commodity fish products in discounters, such as Aldi and Lidl.

“2012 was a challenging year that saw discounter retailers lowering their prices across the fish category and all retail chains increasing their private label offering and pushing up promotion levels in order to deal with the tough economic climate in Europe,” said Eichenlaub, in Iglo’s annual report.

Despite this the company’s market share fell by less than 0.5%, thanks to increased promotions and the launch of a new batter-coated fish range, Filegro Backfisch, said Eichenlaub.

A “good portfolio mix” also led to improved profitability, he added.

The company revealed it will install a new coated fish line in its Bremerhaven factory.

Weak year

The comments were part of Iglo’s annual report, which shows a weak year for the company whose owners Permira tried, but failed, to sell the business in 2012.

Net sales, or revenue, fell 1.5%, to €1.539 billion.

The bulk of that is from core categories — fish, vegetables and poultry — which were virtually flat from last year, up 0.4% to €1.22bn.

Gross and operating profit were up, by 1.6% and nearly 10% respectively, to €607 million and €321m.

The net loss slightly narrowed to €78m, from €82m in 2012. Gross margin was 34.6%, roughly stable from 2011 (34.4%).

Earnings before interests, taxes, depreciation and amortization (EBITDA) before exceptional items were up 4% to €341.3m.

As in 2011, the board decided no dividends will be issued.

Debt increase

Net debt increased by €219m to €1.629bn in 2012. The company’s net debt to EBITDA ratio increased to 4.7 times by the end of the year, compared to 3.9 times in September 2012, and 4.3 times in December 2011.

The group said it “successfully refinanced the business” in November 2012, raising €250m in new senior debt and extending the maturity date of 88% of its existing senior debt, to 2017 and 2018. Senior debt due in 2013 has been repaid, it said.

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