The company’s EBITA slid to €150.8m as consumers in both Europe and North America opted for lower priced products and raw material price hikes put margins under pressure.
CSM has conducted a restructured business review in a bid to reverse its fortunes that includes a focus on convenience products, such as frozen bakery.
The move will mean 100 jobs will be lost.
Artisanal out
Company CEO Gerard Hoetmer said: "2011 was a very challenging year for us. We faced substantial raw material cost inflation in a difficult consumer environment impacting our volumes in an intensified competitive landscape.
“This put our 2011 results under severe pressure and led to a disappointing EBITA level.”
Net sales for the year were up 4.1% to €3.1bn, though profits suffered a 30% decline. Profits in Europe were worst hit, down almost 38% to €61.8m.
Hoeter said this was down to a shift from traditional artisan bakery channels towards in-store and out-of-home bakery, triggered by consumers tightening purse strings in a tough economic environment.
Out-of-home and in-store in
The shift led to declining sales volumes for CSM in North America and Western and Southern Europe.
The company said it would look to cheaper products to return to growth, including the frozen segment.
In October last year, CSM issued a Relevance Cost reduction plan, which it claims will save it €30m in 2012 and a further €20m when the programme is realised in 2013.
So far this has meant 400 employees have been axed. A further 100 jobs are expected to go before the full cost reduction plan is completed by 2013.
Last month, the company acquired UK biscuit firm Cookie Man to leverage its position in out-of-home markets.
2012 outlook
This year is expected to be a transitional year for CSM.
“It is clear that the trading environment in 2012 will remain very challenging,” said Hoeter.
The company said consumer confidence remained fragile, which could impact demand. Raw material prices are also expected to remain high.
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