SUBSCRIBE

Breaking News on Food and Beverage Processing and PackagingWorldUSEurope

Total plant assurance model is reaping rewards, says Ecolab

By Joe Whitworth , 27-Feb-2013

A total plant assurance approach has enabled Ecolab to win new business and offset slow conditions in the beverage and protein markets.

Cleaning and sanitizing, water treatment, wastewater and pest elimination solutions were identified as plant-wide solutions by Michael Monahan, senior vice president of external relations as the firm reported Q4 results for the period ending 31 December 2012.

The firm reported the segment sales were up 2% with good gains in dairy and food offsetting beverage or lower beverage and protein sales while foodservice foot traffic remained soft.

Growth of 3% in pest elimination sales was driven by food processing and healthcare.

Food & Beverage and Pest Elimination continue to grow at double-digit rates despite some slowing in Latin American markets, such as Brazil.

Douglas M. Baker, chairman of the board and CEO, described the quarter as a “very good end to a very good year”.

Europe uncertainty

In an analyst conference call, Baker said that “steady” would be a hard word to use in a sentence with Europe and added that he expected it to be the same as last year.

“We do not see significant degradation, but you still see real softness in countries I think you would expect and particularly Italy, Greece, Spain and some of the other countries. And we expect to see that continue through this year. We think we will offset it, hence, our forecast of growth.

“Now, we did it last year. I think our plan is right, and we expect to have nominal growth again in 2013. But Europe, I don't think it'd be fair to call it steady-state right now.”

Special gains and charges included €43.4m of restructuring costs compared to €16.2m in the same period last year, attributed to 2012 charges for Europe restructuring, Nalco integration and restructuring and Champion acquisition costs which has been approved by all required countries except the US.

2013 outlook

In an earlier statement, Baker said the formula for 2013 was familiar to ensure growth and the ability to overcome sluggish economic headwinds.

We expect modest raw material inflation early in the year which we believe will abate. We also expect another year of higher pension costs due to the extremely low interest rate environment.

“However, and more importantly, we see significant new business opportunities and further cost efficiency and synergy improvements.”