FDBusiness.com

Swiss premium chocolate manufacturer Lindt & Sprüngli has increased its annual sales growth once again, achieving substantial market share gains in all major markets. This growth is once more primarily based on higher volumes. With the successful first-time integration of Russell Stover/Whitman’s from September 2014, the group’s sales passed the SFr3 billion (Eur2.5 billion) mark by a considerable amount for the first time.

The highlights of an eventful 2014 for the Lindt & Sprüngli Group include the announcement of a joint venture in the retail sector in Brazil, the opening of the “Swiss Chocolate Adventure” theme world at the Swiss Museum of Transport in Lucerne by the LINDT Chocolate Competence Foundation, the opening of the highest-situated Chocolate Shop on the Jungfraujoch, and the acquisition of Russell Stover/Whitman’s in the USA. These activities took place in a persistently sluggish European economic climate, coupled with slightly improved consumer behaviour in North America. Rising rates for relevant raw materials and tough price competition were major challenges. Thanks to its uncompromising commitment to premium quality, efficient cost management, and numerous product innovations, the Group again grew much more quickly than the overall chocolate markets.

Excluding the effects of the acquisition, the group’s organic growth in local currencies reached +9.8%, by far exceeding the strategic growth target of 6-8%. The weaker parities of EUR, CAD, and AUD contrasted with a stable US dollar and slightly stronger British currency. The negative impact of currencies on consolidated group sales expressed in Swiss francs amounted to 1.1 percentage points. Including the first-time consolidation of Russell Stover/Whitman’s from September 2014, Group sales reached SFr3.39 billion, an increase of 17.4% against the previous year.

The European market segment achieved organic growth in local currencies of 6.5%, a positive performance to which all countries contributed. The major markets France and Germany reported particularly impressive progress. Due to a wide variety of innovations in both the seasonal and permanent sectors and the ever increasing popularity of the LINDT brand with consumers, Lindt & Sprüngli achieved excellent double-digit growth in the UK. Excluding the sales of Russell Stover/Whitman’s, the NAFTA region grew by an outstanding 14.3% against the previous year. All three US subsidiaries achieved double-digit sales growth thanks to the launch of numerous new products and the increasing interest of retailers and consumers in quality products from Lindt & Sprüngli. The rest of the world segment grew by 13.9%. Impressive progress was again recorded at LINDT in Australia and in worldwide distributor and Duty-Free business. The new subsidiaries opened in Japan, Russia, and China over the past few years also achieved high growth rates at lower absolute levels.

As part of its ongoing expansion into new markets, the “LINDT Global Retail” Division is playing an increasingly important role. Last year, the worldwide amount of own stores grew by twenty-nine units. The sales generated by the Lindt & Sprüngli shop-network amount to around 10% of overall Group sales and make a significant contribution to sustainable strengthening and further consolidation of the LINDT brand image and recognition.

Excluding the acquisition of Russell Stover/Whitman’s, the Lindt & Sprüngli Group expects to improve the EBIT margin in 2014 against the previous year within the range of the medium-term target of 20 to 40 basis points. Including Russell Stover/Whitman’s and the one-off transaction costs, the EBIT margin is expected to be about the same as the previous year.

Employing anout 12,000 people, Lindt & Sprüngli operates 12 production sites in Europe (key brands: LINDT, CAFFAREL, HOFBAUER) and the USA (key brands: LINDT, GHIRARDELLI, RUSSELL STOVER, WHITMAN’S).