Swiss chocolate maker Barry Callebaut has remained upbeat about its prospects despite a fall in first-half profits after it embarked on moves to support its future growth.
For the six months to 28 February, net profit slid 18% to CHF121.8m as a result of lower EBIT, higher financing costs related to a bond placement last year in addition to a less favourable tax mix, the company said today (2 April).
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EBIT dropped 12.5% to CHF175.1m as Barry Callebaut invested in initiatives to “support further growth”, including “ramp up” costs on recent outsourcing deals and increases in production capacity.
However, the company, which supplies chocolate to the likes of Kraft Foods, Nestle and Hershey, reported an increase in sales. Revenue was up 6.7% at CHF699.1m. Sales volumes rose 6.7% in the first half.
CEO Juergen Steinemann said, after “an anticipated slow start” in the first quarter, the company “regained momentum” in the second quarter, in all regions and across all product groups.
“Once again, we outpaced the global chocolate market. Several major new partnership deals were signed, confirming an important part of our business model. In the last six months, we initiated selective investments in our future growth. This temporarily affected our bottom-line results,” he said yesterday (2 April).
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By GlobalDataLooking at trading conditions, Steinemann warned the “economic environment in Western Europe and North America remains fragile”.
Nevertheless, he added: “We are dedicated to investing along the route of our four strategic pillars, expansion, cost leadership, innovation and sustainable cocoa, paving the way for our future growth. With this, we are confident of reaching our mid-term financial targets.”
Shares in Barry Callebaut were down 2.71% at CHF880 at 11:55 CET.
This article was originally published on 2 April. It has been re-published due to a hardware failure that affected the site between 18:00 and 21:30 that day. All original articles are currently unavailable but we are working to fix the problem.
