With net income of CHF 99.5 million, the Baby Care business area achieved sales growth of 4% after adjustment for special effects. HOCHDORF achieved its largest share of turnover with sales to Pharmalys. Bimbosan increased its share in the Swiss specialist market to just over 39%. The basis for further growth has been established with the development of innovative products for special nutritional needs and intensified market development.
In 2020, the Baby Care division (HOCHDORF Swiss Nutrition Ltd and Bimbosan AG) achieved net sales of CHF 99.5 million. After eliminating the value adjustments on receivables made in 2019 and the market sales of Pharmalys Laboratories SA, we increased net sales by 4% compared to 2019, despite the loss of a major customer and the challenges posed by the Covid-19 pandemic. Net income is therefore within the projected sales range of CHF 90 million to 110 million. The largest share of turnover was achieved with sales to Pharmalys. Despite the recall of baby food products, Bimbosan AG remained at the previous year's level and was able to increase its specialist market share to just over 39%.
Innovative products for special nutritional requirements are fuelling growth
In 2020, the Baby Care division focused more on project development with existing and new customers as well as on the development of new products. With the change in EU regulations in February 2020, we launched the newly developed products successfully on the markets in Switzerland and Europe. These are based on the latest scientific findings and positioned in the premium segment.
We have incorporated current trends in nutrition to extend our product range. On the one hand, we have developed a product range based on goat milk; ”Baaa is our new moo“. On the other hand, we have managed to develop a vegan infant formula based on GMO-free soy. At the end of 2020, we launched both new product concepts on the Swiss market under the Bimbosan brand.
By launching Babina Plus in Central America, we expanded our own brand business together with our long-term distribution partner. Babina Plus is a milk formula for growing children and adolescents. Unlike Babina (infant formula) it is sold in retail outlets as well as pharmacies and chemist stores. You can find more information on our website: www.babinaplus.ch. Due to the Covid-19 pandemic, HOCHDORF was unable to provide on-site training on the benefits of Babina Plus to the medical sales force. Instead, our training team organised targeted webinars at short notice, which received positive feedback from our partners.
Our Pre-Term baby food (special food for premature babies) is another product development highlight. Our aim for the current business year is to place this special food with our partners in different markets.
Outlook
To support the further development of the Baby Care business unit, we have formed three sales units: Bimbosan Switzerland, International Own Brands, and Private Label.
The Bimbosan brand will be further strengthened in Switzerland. To achieve this, we are investing in the expansion of our sales force, the launch of new products such as goat milk and vegan soy milk, the relaunch of baby food products and updated branding.
We are specifically strengthening our sales team to accelerate the international expansion of our two own brands, Bimbosan and Babina. We are also consolidating sales from online channels globally. Our aim is to acquire at least two new export markets in 2021.
To ensure existing production capacities are met in Sulgen as quickly as possible, it is important to expand our Private Label business significantly. To achieve this, we want to acquire new customers and place the newly developed products, like our goat milk-based infant formula, with our business partners. We are also working on developing new formula for babies with special requirements and laying the process and technical foundations to enable us to meet individual customer needs more flexibly. We will expand our range to include semi-finished products, known as base powders, for industrial customers.
Due to the ongoing uncertainties around the Covid-19 pandemic and related project delays, we have not published a net sales revenue projection for the Baby Care business.
