Purina expands Iowa pet food plant, gets tax break

The pet food factory expansion will allow for augmented production and installation of additional manufacturing equipment.

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(urfingus | BigStock.com)
(urfingus | BigStock.com)

Nestlè Purina PetCare plans to expand their pet food production facility in Clinton, Iowa, USA by increasing the size of its finished product warehouse. The Purina pet food factory expansion will allow for augmented production and installation of additional manufacturing equipment. Purina started manufacturing operation in Clinton in 1969.

The Iowa Economic Development Authority Board granted Purina tax benefits through its High Quality Jobs program. The Purina pet food plant expansion qualified for these tax incentives because the project is forecast to generate US$140 million in capital investment for Iowa, while creating 73 jobs, paying  US$16.63 per hour. 

Nestle Purina PetCare sales neared US$14 billion in FY19

Sales of Purina PetCare supported Nestlé’s growth globally in fiscal year 2019 (FY19). Nestlé reported their performance in FY19 on Feb. 13, including overall organic growth of 3.5%, and sales of US$94.9 billion (CHF92.6 billion). Purina PetCare sales reached US$13,955 (CHF13,622 billion) in FY19, representing organic growth of 7%.

While all Nestlé’s product categories saw positive organic sales growth, the largest contribution came from Purina PetCare and its premium brands Purina Pro Plan and Purina ONE. 

Purina PetCare financial data

  • Sales FY2019 –US$13,955 (CHF13,622 billion)
  • Sales FY 2018 – US$13,130 (CHF12,817 billion)
  • Real internal growth – 5.3%
  • Organic growth – 7.0%

Nestlé Purina Petcare performance by region

North America’s largest contributors to organic growth were Purina PetCare and the beverages category. Purina PetCare saw strong sales development in e-commerce, premium brands such as Purina Pro Plan and Purina ONE, and veterinary products. Tidy Cats litter had double-digit growth.

Latin America recorded double-digit growth for Purina PetCare.

Europe, Middle-East and North Africa largest growth contributor was Purina PetCare, supported by Felix, Purina ONE and Tails.com. 

Japan and Oceania maintained low single-digit growth with strong demand for Purina PetCare products. By product category, one of the largest contributions to Asia, Oceania and sub-Saharan Africa’s growth came from Purina PetCare. 

"We saw strong progress in 2019, with key operating and financial metrics improving significantly for the second consecutive year,“ Mark Schneider, Nestlé CEO, said in a press release. “Organic growth accelerated, fueled by strong momentum in the United States and Purina PetCare globally. Profitability improved again and reached our guided range one year ahead of plan. Cash flow was strong, while underlying earnings per share and returns to shareholders reached record levels. In 2020, we expect continued organic sales growth improvement as we take further steps to decisively address underperforming businesses.

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