Arla Foods Consolidated Annual Report 2021
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Arla Foods Consolidated Annual Report 2021 / Performance Review / Performance overview
PERFORMANCE OVERVIEW/ CONTINUED
Contents
III
Foodservice and e-commerce had a good year
In the continued pandemic in 2021, with both
re-openings and lockdowns in our key markets in
Europe, our foodservice business captured the
opportunities in the marketplace, gaining shares in
most markets due to strong delivery, key account
management and agility.
Our European foodservice business delivered 7.8
per cent branded volume growth, resulting in EUR
38 million revenue growth in 2021. Half of the
growth was delivered by our Arla® Pro brand. From
a geographical perspective, most of the growth was
coming from the UK, Sweden and Denmark.
On the back of an exceptionally strong 2020, Arla
e-commerce managed to grow revenue above
expectations in 2021, by 17 per cent, despite the
slowdown in the market. All six European core
markets reported positive growth, with the UK
contributing 65 per cent of total growth. To
accelerate our e-commerce presence, we invested in
digital tools and human resources. Our newly
formed, specialised e-commerce acceleration team
rolled out digital shelf analytics to measure, track and
influence Arla's performance on the digital shelf.
Calcium concluded successfully
In 2018, we launched our four-year savings and
efficiency programme Calcium in response to the
volatility of fat and protein prices and the GBP
falling due to Brexit. Calcium created operational
efficiencies across the organisation and delivered
underlying savings (excluding inflation) of EUR 634
million over the past four years, surpassing our
original expectations. In the past two years, we
managed to deliver efficiencies at the same pace as
during the first half of the programme, even though
Covid-19 posed serious challenges to our supply
chain and the continuity of our operations. In 2021,
savings primarily came from optimised supply chain
operations, in-sourcing of marketing activities and
optimised trade investments. Moreover, Covid-19
restrictions led to extra savings in indirect costs, as
there were minimal travel and events in 2021.
Net savings from the programme came under
pressure in 2021 due to the unprecedented
inflation with a EUR 221 million negative effect.
However, with active pricing efforts we recovered
some of the loss due to inflation.
With our new strategy, Future26, we also launched
the next phase of our efficiency programme called
Fund our Future in 2021. Fund our Future largely
builds on the successes of Calcium, with the
additional focus on net revenue management and
end-to-end planning across our supply chain.
Carbon emissions on farm
on a par with last year
In 2021, we continued to work towards lowering our
CO₂e emissions throughout our supply chain.
Compared to our baseline, 2015, scope 1 and scope 2
emissions lowered by 25 per cent, which puts us well
in progress to reach our science-based reduction
target of 63 per cent by 2030. Our scope 3 CO₂e
emissions were reduced by 7 per cent since 2015.
Calcium
In total, CO₂e emissions increased to 19,783
million kg compared to 19,376 million kg last year.
The development is explained by an increase in
externally purchased whey in Arla Foods Ingredi-
ents and increased emissions related to expanding
production capacity at our production site in
Bahrain. These factors were partly offset by
increased purchase of biogas certificates.
Scope 3 emissions per kg milk and whey amounted
to 1.21 kg, unchanged compared to last year. In
2021, emissions specifically from Arla's owners
amounted to 1.15 kg CO₂e per kg of owner milk, on
par with last year.
CALCIUM SAVINGS
(EURM)
7 Read more about the progress towards
our sustainability target in our ESG report.
195
141
143 130
155
114
109
2018
2019
■Calcium savings excluding estimated inflation
634
287
-66
2020
2021
Accumulated
Calcium savings
savings, 2021View entire presentation