The UBM Group, one of Hungary's largest agricultural company groups, continues to grow.
One of Hungary's largest agricultural company groups generated sales revenue of HUF 105.34 billion and profit before tax of HUF 1.03 billion in the first six months of the 2023/24 business year - which ended on December 31, 2023. Hungary's market-leading feed producer and one of the largest feed raw material trading company groups continued its investments and international expansion in the previous half year: in August 2023, it entered the animal husbandry segment and opened its commercial office in Italy.
The UBM Group significantly increased the proportion of its sales revenue from its export activities in the first half of the 2023-2024 business year. While in the first half of the previous business year - in the period from July 1 to December 31, 2022 - export sales accounted for 47.5 percent (HUF 58.25 billion) of the group's total sales, this ratio is the current, 2023- In the first six months of the 2024 business year, it already reached 54.3 percent (the 57.25 billion level). The group's most important export markets include Italy, Austria, Germany and Romania, four fifths of its total export sales come from these.
The significant drop in prices was a challenge
The UBM Group generated HUF 105.34 billion in sales in the first half of the 2023-2024 business year, after the record sales of HUF 122.67 billion in the same period of the previous business year.
Although this falls short of the sales revenue of the base period, it is definitely necessary to mention that the company group was able to achieve this performance in a market suffering a significant drop in prices. The average price of feed corn, used as a raw material for feed production, fell by more than 50 percent, and the price of feed wheat by around 40 percent in the half year ending December 31, 2023, which caused a significant negative price effect on sales revenue
- said Péter Horváth, CEO of the UBM Group. The pre-tax profit reached HUF 1.03 billion in the half year that ended on December 31 last year, which clearly shows an improving trend after the 1.50 billion profit of the entire 12-month business year of 2022/23.
Out of the two traditional business branches of the UBM Group, the commodity business dealing in grains and oilseeds traded 532,249 tons of goods outside the group in the first half of the previous business year. This volume increased to 622,151 tons in the first half of the current business year - with an increase of 16.9 percent. In the first six months of the 2022/23 business year, the feed raw material trading business sold 218,934 tons of goods, increasing this amount by more than a quarter to 274,763 tons in the half year ended on December 31 last year.
They would spread it in a two thousand kilometer area
In March of last year, the UBM Group presented its growth strategy and business plan outlined for the 2025-2026 business year, the main objective of which is to achieve an annual feed production volume of one million tons and an annual feed raw material trade volume of 2 million tons. To this end, the UBM Group continues to expand its continental commercial activities by opening new commercial offices until 2025, thus
within two years, it will be able to serve all markets in a roughly two thousand kilometer radius of Hungary.
For this purpose, the company group - also in the first half of the current business year - established its newest commercial office in Italy: UBM Italy Srl, according to the plans, in the 2024-2025 business year, already 100-150 thousand tons of corn, wheat, soybeans and barley for feed production , will also trade in sunflower, rapeseed and soybean meal in Italy.
"In addition to the domestic market leader status, we want to be among the three largest feed manufacturers in both the Romanian and Serbian markets within three years. At the same time, our wholesale business strives to increase our continental market share with constant market development. Thanks to all of this, we can achieve the annual feed production volume of 1 million tons and the raw material trade volume of 2 million tons per year, as agreed and published in our growth strategy."
Péter Horváth, CEO of the UBM Group, summarized the additional objectives.
Featured image: ubm.hu
