Cristal Union revenues fall 14% as European prices of sugar plunge

French sugar and alcohol maker Cristal Union reported a 14% drop in its annual revenue on Tuesday. It warned that high 'energy costs' and low-duty imports would exacerbate the pressure on European producers who are already under extreme pressure from rock-bottom prices.

The revenue of Cristal Union fell to 2,28 billion euros (2,57 billion dollars) for the year ending January 31. A 462 million-euro impairment charge resulted in a 442 million-euro net loss, compared to a 117million euro net profit last year.

The?plunging prices of sugar have also led to impairments for European?sugar companies, such as Germany's Suedzucker or France's Tereos.

The cooperative group stated that "this impairment is primarily attributable to?the impact of inflation on operating margins within the sector and has no effect on either the cash position of the group or its future investing capacity."

The latest official EU data shows that European sugar has hit a three-year low of 516 euros per metric ton, down by 8% on a year-over year basis and by 40% over the past two years.

The 'Cristal Union' opted to favor alcohol and ethanol production in the last year, and to target sugar sales at Mediterranean markets that were deficit.

The group stated that it believes sugar prices have 'bottomed out' and expects them to re-bounce in the coming months due to further reductions of beet acres for the next crop year 2026/27. (Reporting and editing by David Goodman.)

(source: Reuters)