Kerry Group is reporting a strong recovery in business performance in the third quarter (Q3), with improved volumes approaching prior year levels.
The group today (Wednesday, October 4) published its business performance for the nine months ended September 30.
Some of the key highlights of the report include a group volume reduction of 4.7% for the year to date, while pricing increased 0.3%.
Edmond Scanlon, the group’s CEO, commented: “This year has seen unprecedented variability and complexity across our industry. The agility and ingenuity of Kerry’s teams in adapting to these changing conditions has contributed to Kerry’s strong recovery in the third quarter, which was in line with previous guidance.”
He noted a strong recovery in the food services channel since April, with restaurants reopening and adapting their operations to Covid-19.
Scanlon added that the performance in the retail sector remained strong.
The contribution from acquisitions stood at 1%.
The 130bps decline in group trading margin was attributed to operating deleverage impact resulting from the sharp decline in food services orders.
At the end of September, the group’s net debt was €1.8 billion. Kerry’s consolidated balance sheet “remains very strong which will facilitate the organic acquisitive growth of the group”, the report says.
In the taste and nutrition division, developing market volumes declined by 2.9% in the year to date, though Q3 saw a continued recovery, led by growth in China.
Kerry Group also acquired two businesses, one in North America and one in China.
Meals delivered very strong growth through authentic culinary solutions, with increased demand for natural stocks and broths.
In Latin America, the foodservice channel improved through the third quarter. Overall performance in Brazil started to show good signs of recovery led by beverage and ice-cream, while market conditions in Mexico remained more challenging.
Europe saw the most notable improvement in performance in the third quarter driven by food services, having initially been more impacted from Covid-related restrictions. Russia and eastern Europe continue to deliver strong growth through the third quarter.
In Asia, strong performances were noted in China and the Middle East, with the food services channel continuing to recover in the third quarter, with variability across the region aligned to local conditions.