Instant noodles giant Monde Nissin says it may book £80-100 million ($101-126 million) in impairment charges for its Quorn mycoprotein-based meat alternatives business in fiscal 2024, after the division posted double digit declines in sales in the fourth quarter.
The firm, which launched a b2b ingredients division to sell mycoprotein to other businesses in 2023, recently installed former Heineken UK boss David Flochel as CEO as part of a restructuring plan with a view to becoming EBITDA positive in 2025.
While Quorn posted mid-single digit year-over-year declines in revenue in the third quarter, things had worsened slightly in the fourth quarter, said Monde Nissin in a press release.
“Our meat alternative business continues to operate in a challenging environment, as we expect an approximate mid-teens sales decline year-on-year on a constant currency and comparable basis for the fourth quarter, partly due to fewer selling weeks compared to last year. We expect to achieve positive EBITDA in the fourth quarter despite the ongoing topline weakness.
“Our ongoing annual impairment test for the meat alternative business indicates a significant impairment charge this year, estimated between £80 million and £100 million ($101-126 million). Although substantial, this figure is notably lower than last year’s impairment.”
High in protein and fiber and low in saturated fat and calories, Quorn mycoprotein is an edible filamentous fungus called Fusarium Venenatum first discovered growing in soil in Buckinghamshire in the UK in the late 1960s and grown at a commercial scale using a controlled fermentation process in large steel tanks.
Launched in the UK in 1985, Quorn was introduced to the US in 2002 and acquired by Monde Nissin – one of the leading consumer packaged foods companies in the Philippines – in late 2015 for £550 million ($695 million).
Further reading:
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Author Elaine Watson
