Kerry Group Revises Full-Year Forecast After Solid First Half
Group revenue at Kerry Group increased on a reported basis by 1.4% to €3.2 billion in the first six months of 2018.
The dairy group said that this growth reflects ‘strong volume growth and contribution from acquisitions, offset by adverse currency movements’.
The group’s trading profit increased by 0.5% to €340 million year-on-year, but said that the increase reflected an 8.7% growth after adverse translation currency impact of 8.2%.
Business volumes grew by 3.6% and pricing increased by 0.6%. Contribution from acquisitions accounted for 3.9% growth, and adverse translation currency impact of 6.6% and an adverse transaction currency impact of 0.1% both offset revenues.
“Evolving consumer trends and the changing marketplace have provided increased opportunities and demand for Kerry’s industry-leading RD&A and broad technology portfolio,” said Edmond Scanlon, Kerry CEO.
“This, along with the Group’s enhanced end-use market focus, drove healthy volume growth and underlying margin expansion in the first half of 2018. We also continued to make progress with and invest in business development initiatives aligned with our strategic growth priorities.
Taste & Nutrition delivered 4.1% volume growth and Consumer Foods’ business volumes increased by 1.3%. Both areas saw an increase in pricing.
Group trading margin reduced by 10 basis points to 10.5%, reflecting a 10 basis points improvement in Taste & Nutrition, positive underlying margin improvement in Consumer Foods offset by adverse sterling exchange rates resulting in a 60 basis points margin reduction.
Kerry said that its growth prospects for the full year ‘remain strong due to a good innovation pipeline’. It said that it will continue to invest in business development aligned to strategic growth priorities.
“In light of the above, we update our guidance and now expect to achieve growth in adjusted earnings per share of 7% to 10% in constant currency,” Scanlon concluded.
© 2018 Checkout – your source for the latest Irish retail news. Article by Aidan O’Sullivan. Click subscribe to sign up for the Checkout print edition.