Prawns and shellfish have in recent years been a fast-growing pillar of Alfesca’s business through Lyons Seafoods in the UK. In 2007, the prawn and shellfish pillar of Alfesca was strengthened considerably by the acquisition of the French company Adrimex, a leading specialised processor and distributor of high-quality shellfish. This acquisition means that the prawn pillar is now pan-European, with a leading market position in both the UK and France. Prawns and shellfish account for 30% of the net sales of the company.

Lyons Seafoods and Adrimex rely essentially on tropical farmed prawns but a small part of the turnover consists of coldwater prawns. Availability of warmwater prawns is progressing everywhere in the world, leading to very stable prices for the raw material. Lyons Seafoods and Adrimex source prawns from different parts of the world, mainly Asia and South America, making Alfesca less dependent on conditions in any one area.

Lyons Seafoods currently has more than 50 suppliers in approximately 20 countries around the world.

Market trends

There has been a steady increase in demand for prawns and prawn-based products in the food market, and today prawns are a fast-growing pillar of Alfesca’s business. Alfesca’s prawn business is aligned with fundamental consumer trends, as prawns have become more popular as a premium product with more affordable price positioning, together with a consumer shift towards convenience and healthy foods; these are strong attributes of prawn-based products.

These underlying trends explain the sturdy growth of the market in Europe. The UK market grew by 5.7% with respect to last year while the French market grew by 14%.

The increased range of products on offer, covering every possible occasion, whether indoor or outdoor, beginning with the aperitif, covering the starters and the main course, also helps to explain the good market trends.

Adrimex’s strong position in the prawn market in France and good fit with Alfesca’s existing business and brands provide Alfesca with a strong platform to build the prawn and shellfish business up further in an exciting growth market.

In addition to healthy eating trends, consumer concerns about sustainable, ecological and ethical aquaculture, where Lyons Seafoods leads the industry, are driving growth. All Lyons branded farmed warm-water prawns now carry an “E” logo, clearly indicating to consumers this excellence in sourcing.

The philosophy of Lyons Seafoods and Adrimex is to provide customers with the highest quality seafoods, which are sourced from controlled, ecologically sound and sustainable sources, processed to the most stringent standards. This is to ensure that Alfesca’s products always meets its customers’ expectations regarding quality, choice, flexibility and convenience at affordable prices.

Lyons Seafoods is the category leader in shellfish production and sales in the UK retail and food-service markets.

Approximately 90% of Adrimex’s net sales derive from tropical prawns, which are largely sold to a large portfolio of clients among hyper- and supermarket retailers in France.

Outlook

The prawn market has a strong potential for further development.

Innovation will drive this growth forward. The key to increasing the market is to develop new products to promote more frequent consumption and on more occasions. Alfesca is well equipped to face this challenge, with a strong track record in innovation, and a large portfolio of projects in the development pipeline, both in France and in the UK. Alfesca’s aim is also to attack on a larger scale the Spanish market. Although Spain consumes the most seafood per capita in Europe, for the time being it still has only a very basic prawn offer on the market.

It is anticipated that raw material prices will continue to increase, as a consequence of a possible strengthening of the dollar, and an increase in domestic market demand in the countries where prawns are farmed.

This pillar is expected to represent an important part of Alfesca’s development for this financial year.