GERMANY- German dairy group Hochland has announced that it will not exit Russia and will continue operations at its three plants in Moscow, Belinsky, and Prokhorovka.
Hochland joins the likes of Danone, Unilever, and Nestle who have continued operations in Russia undeterred.
The company, one of the largest cheese manufacturers in Europe with a total of around 5500 employees, has a significant footprint in Russia, where the Hochland brand continues to post steady growth.
The Hochland Group’s three plants in Russia have a total of 1,600 employees, with Ukrainian employees among the staff in various national Hochland companies.
CEO Peter Stahl said: “We share the view of the German government that the necessary international sanctions should hit those responsible for this war hard, but not the people in Russia. That is why we are currently maintaining food production at our Russian sites. “
Hochland has invested more than US$158.58 million in Russia, where almost a quarter of sales are achieved.
In protest of Russia’s invasion of Ukraine, the company announced in March that it has imposed an advertising and investment freeze in Russia.
Hochland’s decision to maintain its Russia operations comes as its business in Germany booms.
According to the company’s 2021 annual report, Hochland achieved a 4% increase in cheese sales as well as an increase in turnover across the group to around US$1.8 billion.
“Despite a difficult environment in the past financial year, cost increases in all central areas as well as strained supply chains, the company business has grown stronger in both the brand and the food service business,” Hochland said.
The German brand business again has grown faster than the market and the foodservice business has reached pre-Corona levels.
There are also positive turnover developments in the Eastern European subsidiaries Hochland Romania, Hochland Polska, and Hochland Russia.
Hochland is also taking a strategic move of investing in the infrastructure at the Heimenkirch site and a fully automated high-bay warehouse with two climate zones being built at the Schongau site.
At the same time, the French site in Dieue-Sur-Meuse is under construction and will be used to process a wide variety of milk types, enabling Hochland to expand its territories.
Furthermore, the growth was also contributed by Saputo Dairy UK and Hochland Deutschland’s long-term partnership in the management of the cheddar brand Cathedral City in Germany and Austria.
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