Switzerland-based chocolate manufacturer Lindt & Sprüngli has said its 2020 financial targets are “no longer valid” as a result of the coronavirus outbreak.

The previous guidance was organic sales growth of 5-7% and an operating margin improvement of 20-40bps.

In a market update issued today (31 March), Lindt & Sprüngli said although it had started the year strongly its business has been impacted by Covid-19.

“The impacts affect mainly travel retail, the own store network, foodservice as well as the grocery trade in certain markets,” it said.

“The e-commerce business, home delivery and pick-up services at some stores are yet gaining importance. 

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By GlobalData

“While the extent and duration of the situation are still uncertain, the group’s growth and financial outlook 2020 is no longer valid. Lindt & Sprüngli continues to monitor the development of the outbreak.”

The company said its mid- to long-term growth target of 5-7% sales growth a year is still valid.

Alain Oberhuber, an analyst at MainFirst Schweiz, said it now expects that Lindt’s full-year 2020 earnings will be down by 13% versus its previous prediction of a 2% increase – a drop of 15%.

However, Lindt & Sprüngli said it is confident it can overcome the current economic slowdown and come back strongly. 

“The top priority remains to protect the health and safety of employees, consumers, business partners and suppliers, while preserving the strengths of the company and taking decisive action to mitigate the financial impact of Covid-19,” it said.

In January, the company announced cost-saving measures in the US, including factory and store closures, in an attempt to kick-start faster growth in one of its most important markets.