Sources inform ''Globes'' that Strauss Group Ltd. (TASE:STRS) intends to double its sales within four years. The firm, which is controlled by the Strauss family, has set a target of doubling its domestic and global turnover to $12 billion by 2012.
The target was unveiled in an internal group presentation, and a spokesperson for Strauss said in response, "The group does not publicize forward-looking data, and we are therefore unable to make any comment on this."
The increase in revenue will be generated primarily by international activity, which now accounts for 40% of group revenue. Activity will be expanded in countries where Strauss already operates, as well as in new territories. Strauss Group president and CEO Erez Vigodman has smade it clear in the past that the group had no intention of limiting itself to the countries it already operates in. "We still haven't reached everywhere, but it is only a matter of time until we expand to more and more countries, including in Asia," he said, "We are not ruling out other countries in the Middle East either."
The firm plans, as the first step, to expand its global coffee business, which is currently concentrated in Brazil and Eastern Europe. The business will be expanded primarily through acquisitions. In addition, Strauss intends to expand its prepared salads business in North America through its subsidiary Sabra Salads Food Industries Ltd. The firm also has plans to expand the business of its gourmet chocolate subsidiary Max Brenner Ltd., as well its secretive water venture H2Q Technologies, considered one of the firm's future sources of revenue.
In recent years, Strauss recorded sharp growth in revenue and profit, largely as a result of its expansion overseas. The group's full year revenue has climbed from NIS 2.9 billion in 2002, to NIS 5.96 billion in 2007. Strauss does not intend to maintain this level, and now aims to double it within four years. However, its international activity is currently characterized by margins that are quite low, compared with those in Israel, so if the group does double its sales in the said period, it is doubtful whether its profit would double as well. Strauss posted a net profit of NIS 292.8 million for 2007.
Published by Globes [online], Israel business news - www.globes-online.com - on July 29, 2008
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