The group's investment in associates and joint ventures with other companies contributed €24.5 million to the total operating profits of €109.1 million, compared with a €9.97 million contribution up to July 2003.
A joint venture with the Tim Hortons coffee shops in the US and Canada, through which IAWS supplies baked goods to all 2,582 Tim Hortons outlets, has produced sales growth of more than 100 per cent after IAWS opened its new supply bakery in Canada.
One of IAWS' best-performing associates has been the Swiss gourmet baking firm Hiestand. IAWS bought a 22 per cent stake in the group in 2003 and the reported a 39 per cent growth in net income from Hiestand for the first half of 2004.
The improved performance of these ventures has formed the bulk of IAWS' profit increase, without which the company would have been staring at an operating profit of €84.6 million before goodwill amortisation, more than a million euros down on its 2003 figure of €85.8 million, due to a difficult year for its nutrition/agri division hit by poor volumes and the weak dollar.
That the added-value business is seen as the bright hope for the future is clear from the amount of cash that IAWS has invested in it in the last few years. Since 1998, some €540 million has been poured into the Lifestyle Foods division, and food (rather than ingredients or agricultural products) now accounts for 70 per cent of company operating profits. Underlying sales in this sector were up 5 per cent at the end of July.
The forecast for IAWS also looks promising with the company looking at launching its US-based La Brea brand in Europe, and new product launches such as a new range of croissants filled with raspberry jam.