Kerry Group has announced a decrease in group revenues by 5.9% in the first six months of the year, attributing this to the reduced prices affecting their dairy Ireland and taste and nutrition operations. However, the company has increased its earnings per share forecast for the full year based on its robust financial results, according to CEO Edmond Scanlon, who highlighted increased volume in the company’s two key business sectors.
The group stated a 4% price deflation across all sectors for the said period, documenting revenues of €3.9 billion, showing a decrease of 5.9% compared to the previous year. The company mentioned the sale of group assets, including buildings, machinery and equipment in North America and Europe during this period, along with the lasting effects of the sale of its sweet ingredients operation last year, as contributing factors to the decreased revenues.
Inclusive of global milk market fluctuations, the company’s dairy Ireland branch reported a 1.9% decrease in revenues to €592 million during the first half-year period due to a 6.9% price reduction. However, Kerry’s more substantial taste and nutrition sector reported an increase in revenues by 3.1% to €3.4 billion despite a 3.1% decrease in prices. The EBITDA within this division grew by 5.5% to €551 million during the same period compared to the first half of 2023.
Nevertheless, the group’s pre-tax profits fell approximately 3.8% from €379.2 million last year to €364.8 million this year. A one-time non-commercial cost of €20.2 million was also reported by Kerry, in relation to its ongoing transformation program.
“We are content to report a favourable performance throughout the first half of the year. Taste and nutrition realised substantial volume growth beyond our finish markets, with considerable profit enlargement and margin expansion across the industry, leading to our earnings per share growth of 9.1% for the period,” stated Mr Scanlon.
Outstanding outcomes in the food service sector across every region nudged the development in both taste and nutrition. Our efforts to aid long-standing food service chains in enhancement and diversification of their business, in conjunction with aiding rising leaders in upgrading their operations and services, are ongoing,” said Mr Scanlon of the Kerry Group.
He also mentioned that a significant part of the volume growth achieved by the Kerry Group in the retail channel was due to commendable outcomes in the Americas and Asia-Pacific/Middle East areas.
Furthermore, the conglomerate revised upwards its annual earnings per share guidance. It now suggests an expected increase ranging from 7 to 10 per cent, up from a previous forecast of 5.5 to 8.8 per cent increase.