The results of 2015 show Fazer performing well in operating environments that can be described as both demanding and highly volatile.

Our efforts to maintain this level of success, however, were complemented with actions focused on guaranteeing our future, strengthening our home markets and building prerequisites to develop international expansion. Fazer’s investments in facilities, production machinery and equipment during the year totalled in 60.4 million euros. Continued development of our personnel, brands and marketing process was in focus. 

There is a great spirit in the company, and I see examples of this at work each day. This was also visible in the results of our 2015 People Power personnel survey, which showed much positive development with engagement reaching all time high levels. The response rate was exceptionally high at84.4 per cent. 

To preserve this forward momentum, what we call Fazer behaviours have been introduced to define what the Group expects from managers and employees at all levels. This helps employees to act according to the Group’s values and principles at all times, supporting their colleagues and both giving and receiving constructive feedback. 

The world around us continues to transform at a fast pace. Needless to say, it’s difficult to forecast what the future holds, but we are prepared for changes as they come. In 2015, the EU refugee crisis was among the most prominent issues, and I’m proud to say that when it arose, Fazer took immediate action to support the communities it operates in, as well as making plans for long-term support. 

The risks related to Russia remain, with the effects of sanctions and the weakened rouble still substantial for us. In Russia, business has developed well in local currency, but in the translation to euros we see the inevitable impact. Raw material prices in Russia escalated at the end of 2014 and have continued on a high level since. The weakening of the rouble has had and will continue to have consequences for Fazer. 

However, we also saw positive changes in our operating environment in 2015, as the Finnish government announced that it will abolish its arbitrary excise tax on confectionery, ice cream and soft drinks, creating a fairer marketplace and clarifying the competitive landscape. 

 All our business areas delivered in 2015. Fazer Bakery saw good development in Sweden and launched innovative and successful products in new categories both there and in Russia. The Finnish bakery market is a concern due to price pressure as well as increased imports. Fazer Confectionery enjoyed a good year, with the chocolate business proving particularly successful. In Fazer Food Services, a newly formulated business park solution and the business area’s entry into the Swedish health care market both showed  our willingness to capitalise on the rapid developments of a dynamic environment. Fazer Cafés opened new units and demonstrated a significant result improvement and Fazer Mill& Mixes’ oat mill is now working at full capacity a year ahead of schedule, which leads me to the topic of investment. 

Maintaining Fazer’s competitiveness in the domestic market is very important to us, and over the last three years, we have invested around 100 million euros in Finland. In December 2015, we made the decision to double the capacity of our oat mill. We plan to invest over 100 million euros in Finland during the next three years in addition to this, boosting our market presence, our exports and creating more jobs. 

Several investments were also made internationally. In 2015, Fazer invested over 22 million euros in total outside Finland, for instance in the Ogre bakery extension in Latvia and the Kävlinge production kitchen in Sweden. 

September 2016 will mark 125 years since Karl Fazer opened his French-Russian café on Helsinki’s Kluuvikatu, and we plan to celebrate this anniversary in style. Remembering the birth of Fazer as a company can also fuel our future progress. Our founder’s courage and dedication to his vision is the inspiration for us to create the future we would like to see. I am pleased to point out that our new visitor centre in Vantaa will open in the anniversary year. The new centre, a strong investment in Finnish design in itself, will give our visitors an even more comprehensive experience of our brand and the many stories it encompasses. 

2016 and beyond will see us continuing on our chosen path, and making investments to ensure our success in the future. In closing, I’d like to thank you for being with us on this journey, and for the hard work and support of all our stakeholders. 

 

Christoph Vitzthum 

President  & CEO 

Fazer Group