DENMARK

Danish Crown creates new foundation

To ensure full focus on value creation and regain competitiveness in the pig market, Danish Crown has decided to divide its core business into three business units with immediate effect.

Posted on Apr 08 ,00:25

Danish Crown has now entered the second phase of the three-part transformation program that Group CEO Niels Duedahl put himself in charge of shortly after taking office seven months ago. The first part was about creating an overview and gaining control over the overall business. That goal has now been achieved, and the next task is to create a more efficient structure.  

"We must ensure a sharp focus on value creation, so we have decided to split Danish Crown's core business into three business units, each of which must generate earnings that can be passed on to the owners", says Niels Duedahl, Group CEO of Danish Crown.   

Effective April 1, what was previously called Danish Crown Business Unit has been divided into three business units: Danish Crown Industry, Danish Crown Foods and Danish Crown UK.  

• The operation of the pig slaughterhouses and sales to industrial customers will in future be the responsibility of Danish Crown Industry, which will employ approx. 5,200 employees and have a turnover of approx. 17 billion kroner. The core tasks of Industry are to ensure efficient operation of the pig slaughterhouses and sell the many different products at prices that make it attractive to deliver pigs to Danish Crown. 

• Sales and production of both fresh and processed products for customers in retail and foodservice will in future be handled by Danish Crown Foods, which will employ approx. 3,000 employees and have a turnover of approx. 13 billion kroner. Based on efficient production, Foods' core task is to sell fresh and processed products, develop Danish Crown's brands and generate earnings for the group. 

• The UK business will in future become an independent business unit with around 1,000 employees and a turnover of approx. 4 billion kroner. Danish Crown UK is a growth case for the group that can best be developed with a strong and local management that is fully focused on running the UK factories efficiently and servicing customers throughout the UK.   

The split follows a thorough analysis that establishes that the merger that took place of the then Pork and Foods in 2021 is not working as intended.  

"Instead of continuing to spend resources on a complex integration, we choose to make a division. All three business units will have their own management and will be measured individually. In short, they will each receive a sharp focus, and as management we will gain transparency in relation to where and how profit is created in the business", says Niels Duedahl. 

During a transitional period, Niels Duedahl will be the chief executive of all three business units. A process has been initiated to find the three directors who will lead Industry, Foods and UK respectively.  

"Each business area will have a much sharper focus, stronger management power and know exactly where and how they can and should create profit. This will undoubtedly contribute to restoring our competitiveness on the listing, and at the same time we will set up the organization for the strategy work that we will start before the end of the year," says Niels Duedahl. 

The division into the three business units is essentially a matter of internal organization. In accounting terms and in the dialogue with customers, suppliers, owners and other stakeholders, the three business units will continue to be called Danish Crown.     

Danish Crown Group will now consist of eight business units in one consolidated group : Danish Crown Industry, Danish Crown Foods, Danish Crown Beef, Danish Crown UK, DAT-Schaub, ESS-FOOD, KLS, Sokolow. 

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