Czech Republic Food and Drink Report Q2 2012 - new market research report

London 5/17/2012 09:48 AM GMT (TransWorldNews)

The price of this market report covers 4 quarterly reports on this sector. This quarterly report will be downloadable instantly as a PDF document, with the 3 remaining reports delivered at regular intervals throughout the year.

The Czech consumer outlook remains very challenging. As austerity measures continue, both household and government spending are expected to remain in the doldrums over the course of 2012, as they were throughout 2011. Unemployment remains high, and there is little optimism on this front over the coming year. In addition, a confluence of macroeconomic headwinds has led to revise down our real GDP growth forecast for the Czech Republic, pencilling in 1.9% economic growth in 2011 from 2.3% previously, and 0.8% in 2012 down from 2.3% previously. All this will continue to weigh on consumers discretionary spending.

Headline Industry Data (local currency)

- 2012 per capita food consumption = -0.1%; forecast compound annual growth rate to 2016 = +1.27%
- 2012 beer volume sales = -0.08%; forecast compound annual growth rate to 2016 = +0.01%
- 2012 confectionery volume sales = +2.3%; forecast compound annual growth rate to 2016 = +2.93%
- 2012 mass grocery retail sales = -0.3%; forecast compound annual growth rate to 2016 = +3.78%

Key Company Trends

Tesco Launches Online Shopping in Czech Republic: At the beginning of 2012, Tesco rolled out its online grocery shopping service to serve customers in the Czech capital Prague. Under the new service, more than 20,000 lines of fresh and frozen food and groceries, as well as non-food items such as toys, stationery and accessories, will be on offer. The move came after a successful trial with customers and staff in November 2011.

Food Sector Shows Signs of Consolidation: There was significant mergers and acquisitions activity in the countrys bakery and meat processing sectors in late 2011. The countrys largest bakery company, United Bakeries, was acquired by food manufacturer Agrofert. The acquisition provides Agrofert with plants in the Czech region of Bohemia and facilities across the border in Slovakia. Subsequently, private equity firm Penta Investments became a co-owner of Schneider, the countrys largest meat processor. The deal is subject to competition authority approval, with the two companies stating that the move was an important step in terms of consolidating the meat processing industry in Central Europe.

Key Risks To Outlook

Continued Slowdown In Eurozone: Growth is set to slow markedly in the eurozone on the back of weakened external demand globally and rising uncertainty as to the longer-term economic trajectory of the bloc. We believe that small, open economies in Central Europe where recoveries have been based largely on exports, such as the Czech Republic, will be hit hard by the sharp moderation in external demand.

Click for Report details:Czech Republic Food and Drink Report Q2 2012

 

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