Kerry Group has reported revenues of more than €4 billion, despite inflationary challenges, in its half-year interim results published today (July 29).
Group revenue of €4.1 billion represents 13.3% increase and a volume growth of 6.8%, with earnings before interest, taxes and depreciation (EBITDA) reaching €518 million.
Headline figures and facts
- Group volumes: +6.8%, with taste and nutrition up 8.6% and Dairy Ireland up 1.2%;
- Group pricing: +8.3%;
- Interim dividend per share of 31.4% reflects an increase of 10.2% from the prior year interim dividend;
- Divestment of Russian subsidiary completed.
Commenting on the results, Kerry Group chief executive officer, Edmond Scanlon said, despite inflationary challenges and geopolitical volatility, Kerry Group is pleased with the results and overall performance.
“Volume growth was very strong in both retail and foodservice channels, driven by an increased level of innovation activity,” he said.
“This growth was based across our regions, led by excellent performances in beverage, meat, and bakery end-use markets in particular.
“We continued to make good progress in actively managing the unprecedented inflationary environmen. We also made good strategic progress by expanding our footprint and completing a number of strategic acquisitions in the period.”
While recognising the marketplace is facing into a period of heightened uncertainty and volatility, this also presents significant opportunities for the group, the CEO added.
According to the group, the overall demand environment was positive through the period, with heightened demand for new food and beverage experiences.
The resilience of supply chains remains a key focus across the industry due to geopolitical volatility and inflationary pressures, the group said.
Taste and nutrition
According to the interim results, the taste and nutrition side of the business reported increased revenue of 27.5% to €3,445 million, driven by volume growth, positive pricing, favourable foreign-currency impacts and a positive contribution from acquisitions net of disposals.
H1 2022 Performance Revenue €3,445m +8.6% EBITDA €515m +24.9% EBITDA margin 15% -30bps
The foodservice channel delivered strong double-digit growth across all regions, supported by increased seasonal menu offerings, innovations to reduce operational complexity and solutions designed to improve their overall sustainability impact, the group said.
Overall, growth across the group’s key growth platforms was strong, led by increased demand for Kerry’s range of food-waste solutions, with good growth across authentic taste and plant-based, while health and bio-pharma performed in line with expectations.
Business volumes in emerging markets increased by 10.7% in the period, as very strong growth in the Middle East, Southeast Asia and Latin America (LATAM) were partially offset by challenging conditions in China due to localised restrictions in place, and in Russia and Eastern Europe due to the ongoing war in the region.
Dairy Ireland
Dairy Ireland delivered solid overall volume growth through the period, while managing the heightened inflationary cost environment, which resulted in significant price increases across the business.
H1 2022 Pro-forma Reported Revenue €695m +2.2% +1.2% EBITDA €38m +4.6% -52% EBITDA margin 5.5% -140bps -280bps
Within dairy consumer products, most categories saw significant price increases, which led to overall volumes being more challenged.
Within the spreads category, good performance was achieved across its customer-branded ranges.
Volumes in cheese snacking were impacted by reduced promotional activity and operational issues.
A new plant-based range of Dairygold products was also launched
Kerry Group future prospects
The group said it remains strongly positioned for growth and is confident in its ability to continue to manage through the current inflationary cycle.