Strong First Half From Kerry Group

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Strong First Half From Kerry Group

Strong First Half From Kerry Group
August 11
09:28 2015

Despite challenging market conditions and volatility in many regions of the world, Kerry Group delivered a strong financial performance throughout its core businesses in the first half of 2015. The global ingredients, flavours and consumer foods group reported a 4.7% increase in revenue to €3 billion for half year ended 30 June 2015. Business volumes grew by 2.7% in the period reflecting a strong overall performance in American markets, an improved performance in the EMEA region and continuing good growth in Asia despite a slowdown in some regional markets. Net pricing was 2.7% lower against a background of approximately 6% lower raw material costs. Currency tailwinds relative to the first half of 2014 contributed a positive 8.4% translation impact to revenue.

Group trading profit increased by 9% to €300 million with the trading profit margin advancing by 40 basis points to 9.9%. This reflects a 40 basis points improvement in trading margin in Kerry Group’s Ingredients & Flavours business to 12.1% and a 20 basis points improvement in the Consumer Foods division’s margin to 8%.

The consistent improvement in group trading performance was maintained due to operational improvements arising from the 1 Kerry Business Transformation Programme, improved product mix and portfolio repositioning in Kerry Foods.

Stan McCarthy, chief executive of Kerry Group.

Stan McCarthy, chief executive of Kerry Group.

Ingredients & Flavours increased trading profit grew by 12.3% to €281 million and reported revenue increased by 8.6% to €2.3 billion.

Following the sale of the Consumer Foods division’s pastry manufacturing assets in August 2014 and the management buy-out of the Direct-To-Store business in the UK completed at the end of February 2015, the repositioned Kerry Foods portfolio has achieved encouraging results to-date. Revenue was 6.4% lower at €749 million and trading profit decreased by 3.9% to €60 million due to the business disposals. However, trading in the division’s continuing businesses improved satisfactorily. Rollover was acquired in January, extending Kerry Foods’ ‘hot-to-go’ offering and channel distribution in the UK market.

Stan McCarthy, chief executive of Kerry Group, comments: “We delivered a strong financial performance in the first half of 2015 reporting continued business margin expansion and an 8.1% increase in adjusted earnings per share. Based on group year-to-date performance, current exchange rates and business momentum, we are increasing our market guidance for the full year.”

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