06/11/2019 | Industry, International

Barry Callebaut: mid-term guidance delivered

The Barry Callebaut Group increased its sales volume by 5.1% to 2.140 m tonnes in fiscal year 2018/19 (ended August 31, 2019), with, as expected, a stronger contribution in the second half of the year. According to the company, sales volume in the chocolate business grew by 5.9%, well above the growth rate of the global chocolate confectionery market (source: Nielsen, + 1.8% in volume, August 2018 to August 2019 – 25 countries). All Regions and key growth drivers – Outsourcing (+ 5.2%), Emerging Markets (+ 9.7%) and Gourmet & Specialties (excluding Beverage, + 6.1%) – contributed to the good momentum. Global Cocoa volumes increased by 2.4%. Sales revenue increased by 7.8% in local currencies (+ 5.2% in CHF) to CHF 7.309 bn. The increase in sales revenues was supported by the first-time adoption of IFRS 15 and higher raw material prices, which the Group passes on to its customers for a large part of its business, based on its “cost-plus” model.

Gross profit developed in line with the growth in sales volume and amounted to CHF 1.188 bn, up 5.1% in local currencies (+ 2.7% in CHF). The positive effect from volume growth and product mix was offset by costs for structural improvements of operations. Operating profit (EBIT) increased by 11.9% in local currencies (+ 8.5% in CHF) to CHF 601.2 m, affected by a strong headwind from currencies (CHF - 19 m). The Group’s EBIT per tonne continued to improve to CHF 281, an increase of 6.5% in local currencies (+ 3.3% in CHF). Net profit for the year – excluding one-off costs for early bond repayment of CHF 33 m, partly offset by the tax effect of CHF 7 m – grew by 14.2% in local currencies (+ 10.4% in CHF) to CHF 394.7 m. Reported net profit amounted to CHF 368.7 m, up 6.9% in local currencies (+ 3.2% in CHF).

CEO Antoine de Saint-Affrique said: “I am delighted to announce another set of strong results, with profitable growth and good cash generation. We are also proud to have successfully delivered on our mid-term guidance, which was on average 4-6% volume growth and EBIT above volume growth in local currencies for the 4-year period 2015/16 to 2018/19. On average, we have achieved above-market volume growth of 4.5% and EBIT growth in local currencies of 13.9% per year. These achievements confirm the strength of our long-term ‘smart growth’ strategy.”