Today Galletas Gullón has opened its industrial plant VIDA, the latest investment of the Palencia-based company, in which it has already invested 64 million euros, in addition to another 20 million which will be invested this year.
VIDA is built on an area of 55,000 m2 and there are three production lines: one for sponge cakes, one for corn and rice crackers and a third for snack bars. The company anticipates that eight more lines can be accommodated on the site which was opened today.
However, in the future VIDA is expected to reach 110,000 m2 and the company’s objective is to gradually expand on the current plant until the whole space is occupied, implementing new lines each year.
The VIDA plant also has a warehouse for finished products with a capacity for 19,000 pallets. Likewise, there is also a new R+D laboratory where new products which are subsequently manufactured in the plant are created.
Record Sales
VIDA is Galletas Gullón’s latest project. A company that, as announced today, closed 2014 with a turnover of 286.6 million euros, almost 30 million euros more than the previous year, obtaining a 12 % increase and achieving a new sales record. The Palencia-based company has thus confirmed the upwards trend that it has maintained for the past three decades, in which it has continuously increased sales year after year by double digits.
One of the reasons explaining last year’s positive results is an increase in exports which represent 35 % of total income. The positive performance of foreign sales has compensated for the standstill in domestic consumption as the Spanish market, in global terms, has dropped by 0.6 %. In this respect, the company’s growth depends on internationalisation, and the company has focused on this objective in the past decade. Gullón reaches more than 110 countries throughout the world. Geographically speaking, Europe and Asia-Pacific are the two most important regions as far as foreign sales are concerned, especially the latter.
Furthermore, in 2014 Gullón increased its workforce by more than 200 people, 20 % more than in 2013, reaching more than a thousand employees. Currently more than 1,100 people work at Gullón and it is estimated that in the next five years this figure will increase considerably as new production lines are opened at VIDA.
This data reflects the importance of the company in the north of Palencia where Gullón acts as an economic driving force in the region. Around 80 % of Gullón’s employees are from Aguilar de Campoo and other nearby towns such as Cervera, Herrera or Guardo, in Palencia; or Reinosa and Santander, in Cantabria.
At the beginning of the year, Gullón announced that it would allocate 35 million euros in 2015 to productive investments, of which 20 million for VIDA and 15 for Gullón-2. This is in line with the investments implemented in recent years. In 2014, Gullón invested 31 million euros and became one of the top ten companies in the agriculture sector with the highest investments, according to data by the magazine Alimarket. Gullón topped this ranking in 2013 after inverting 44 million euros. This data is especially important considering that in the past five years, in the midst of the economic crisis, Gullón has inverted a yearly average of 35 million euros.
Profit Reinvestment
While the company has not provided profit data from last year, it has reported an improvement compared to the previous year. It has also confirmed that the biscuit company’s Administrative Board, in a meeting held on 25 March, has agreed not to distribute dividends and to reinvest profits in the company.
The profit reinvestment policy defended by Gullón’s president, María Teresa Rodríguez, since she took on the management of the company in 1983 is one of the company’s hallmarks. In fact, this business strategy has allowed Gullón to self-finance its investments and grow without debts.
Finally, it is worth noting the growth experienced by the Gullón brand which has increased by 8.8 % in the past year. In a year in which the consumption of private label or white label brands has stalled (although it still represents 53 %), the increase in sales of the own brand becomes much more important.
In line with the above, the Gullón brand still leads the health-biscuit sector with a 30 % market share in Spain. In 2014 it extended its range of healthy products with Vitalday, a new line made up of biscuits and crackers produced with high-fibre wholemeal cereals. The company allocates almost 2 % of its turnover to R+D+i projects.