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Monday, 10 December 2012 00:00 - - {{hitsCtrl.values.hits}}
LONDON (Reuters): Lloyd’s Register, the world’s oldest ship classifier, is expanding in the faster growing food safety and certification sector partly to dilute its exposure to the volatile shipping business, its chief executive said.
Lloyd’s Register, which was founded in a London coffee house in 1760 and is known for verifying safety and environmental standards in ships, is also moving into other areas such as the energy, waste and water sectors.
Shipping is going through one of its worst ever downturns.
“Because of the fluctuating market in marine it is a very difficult business if you are just in marine. We can smooth that out (with other businesses),” CEO Richard Sadler told Reuters.
“Food is our fastest growing sector and that is really an interesting sector for us,” he said in an interview on Wednesday.
The British firm provides food safety and certification services, taking advantage of the globalise nature of food supply chains that require high standards to avoid contamination.
“We have food specialists working for us and they ensure that management of the food through all the different stages is such that by the time it goes from the farm to the fork it will be safe for consumption,” Sadler said.
Lloyd’s Register’s clients include the Mars Group whose brands include M&M’s, Uncle Ben’s rice and Wrigley’s chewing gum as well as US agri company Cargill.
Sadler said it was in talks with a major fast food producer and a leading soft drinks distributor, declining to name them.
The group generated total income of 893 million Pounds (US$ 1.4 billion) in the year ending, 30 June, 4% higher than the previous year. Its management systems division, which includes the food business, recorded a 3.7% rise in income of 176.8 million Pounds in 2011/12.
Sadler said the group, which has offices in 78 countries and employs 7,900 people, had a projected income target of 1.5 billion Pounds by 2015/16, which would be boosted by providing technical risk management services in other areas such as water, energy and waste.
In the past four years the company has invested 170 million pounds in acquiring offshore drilling and risk management specialist companies, such as Holland’s ModuSpec, Norway’s Scandpower and US based WEST Engineering, to give it an edge in the energy services market.
“Independent assurance of supply chain risk whether it’s for oil, water or food these are all linked together,” Sadler said. “That is why the opportunities are enormous.”
Lloyd’s Register, structured as a commercially operated company, is 100% owned by a charity. The proceeds of its profits are used to fund educational and vocational institutions, especially on the technology and science side.
“Without profit you cannot be sustainable,” Sadler said.
