Kerry Group has today (Wednesday, July 2) reported that revenue in the first half (H1) of 2023 increased by 1.6% to €4.1 billion, compared to the same period last year.
The Tralee-based global taste and nutrition company said this reflected business volume growth of 0.6%, pricing of 4.5% and a contribution from acquisitions of 1.1%.
This was partially offset by the effect of disposals of 4.5% and adverse translation currency of 0.1%.
Group earnings before interest, taxes, depreciation, and amortisation (EBITDA) in the first six months of 2023 was €518 million (H1 2022: €517.7 million) as organic growth was offset by the effect of disposals net of acquisitions.
Group EBITDA margin decreased by 20bps to 12.6%, as benefits from cost efficiency initiatives and portfolio developments were more than offset by the mathematical impact of passing through input cost inflation.
Kerry Group confirmed basic earnings per share (EPS) of 201.7c, down from 128.4c in the first six months of 2023, which reflected a profit on the disposal of businesses and assets, partially offset by charges relating to the Accelerate Operational Excellence programme.
The board has recommended an interim dividend per share of 34.6c (H1 2022: 31.4c).
During the period, Kerry Group acquired Colombian food ingredients company, Proexcar S.A.S and Shanghai-headquartered food business, Greatang.
The group also completed the sale of the trade and assets of its sweet ingredients portfolio for €483 million to IRCA.
Kerry Group
Kerry Group’s Taste and Nutrition division reported revenue increased by 2.7% to €3.5 billion driven by volume growth and positive pricing, partially offset by adverse translation currency and the effect of disposals net of acquisitions.
In Europe, reported revenue increased by 5.8% to €771 million driven by volume growth and positive pricing, partially offset by an adverse effect from foreign currency and disposals net of acquisitions.
Growth within the region was led by strong performances in the UK and Ireland.
Reported revenue in the Americas region increased slightly by 0.1% to €1.9 billion, with positive pricing and favourable translation currency offset by lower volumes and the effect of disposals net of acquisitions.
Reported revenue in the APMEA (Asia Pacific/Middle East/Africa) region increased by 5.8% to €813 million driven by volume growth, positive pricing and a favourable effect from transaction currency, partially offset by adverse translation currency and the effect of disposals net of acquisitions.
Dairy Ireland
The financial results show that reported revenue at Dairy Ireland, Kerry Group’s dairy business, decreased by 3% to €675 million.
Positive pricing was more than offset by lower volumes and adverse translation and transaction currency effects.
Volumes in Dairy Ireland were lower in the first half with elevated input costs impacting overall market demand dynamics.
Within Dairy Ingredients, the lower volumes principally reflected softer market supply, while Dairy Consumer Products performed well, with volume growth led by Kerry’s branded cheese ranges and private-label spreads.
Commenting on the financial results, Edmond Scanlon, chief executive of Kerry Group, said:
“We delivered a good performance in the first half of the year recognising varying conditions across our markets.
“Strong volume growth was achieved in APMEA and Europe led by our performance in the foodservice channel, while North America saw customers work through elevated inventory levels.
“We continue to see good levels of customer innovation activity, and our margins reached an inflection point in the second quarter.
“We also made good strategic progress, particularly in executing on our emerging markets strategy with significant acquisitions and investments across APMEA and LATAM [Latin America].
“With Kerry’s strong local footprint and track record of growth across emerging markets, these complementary strategic developments will support our future growth ambitions.
“While recognising current market conditions, we remain strongly positioned for growth and reiterate our full year constant currency earnings guidance,” he said.