Global ingredients, flavours and consumer foods group Kerry has posted a 34.3% increase in sales to €1.8bn (US$1.79bn) for its first half ended 30 June 2002, with like-for-like sales showing a 5% increase year on year when account is taken of acquisitions, divestitures and foreign exchange fluctuations.
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Like-for-like sales growth was 5% while operating profit increased by 18.7% to €128m.
Managing director Hugh Friel said: “H1 2002 has again highlighted the strength and broad geographic base of the group. Despite difficulties arising from international market developments in some sectors, the group achieved a 14.8% increase in adjusted earnings per share.
“Our food ingredients, flavours, consumer foods and foodservice operations continue to grow and develop in line with group projections and we expect a good outturn for the full year.”
Assisted by on-going strong cash generating capability, the group continued to invest in existing businesses and in strategic bolt-on investments. In particular good progress was achieved in advancing the group’s convenience foods, culinary, nutrition, foodservice and global flavour business development objectives.
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By GlobalDataOperations reviews
Ireland and Rest of Europe
Sales originating from Irish based operations almost doubled to €627.1m, boosted primarily by the acquisition of Golden Vale which was concluded at the end of September 2001. Operating profit increased from €18.9m to €26.9m. European operations (excluding Ireland) increased sales by 10.5% to €628.3m while operating profits increased by 8.7% to €43.9m.
In European ingredients markets progress was achieved due to the on-going expansion of the prepared foods industry. On-going development of the division’s foodservice business in the quick-serve restaurant sector proved satisfactory. The Voyager Foods (UK) and Aromont (France) acquisitions performed well, extending Kerry’s position as a pan-European provider of culinary systems and ready-to-use ingredient solutions. The European snack sector continued to grow and Kerry recorded good progress especially in Eastern Europe.
Americas
Sales in the US markets increased by 22% to €473.5m. While the 2001 acquisition programme contributed to this strong performance, organic growth in Kerry’s core businesses again proved satisfactory. Operating profits increased by 18.1% to €52.8m. Kerry’s US specialty ingredients division performed in line with expectations.
Kerry Canada continued to achieve good growth, particularly in the speciality ingredients sector. In Mexico progress in snack and convenience sectors was very encouraging. In Brazil, integration of the Siber and Nutrir businesses acquired in 2001 is well advanced. Good progress was achieved through sweet inclusions and flavours in the ice-cream and dairy product sectors and through seasonings in the meat industry.
Asia Pacific
Growth and development in Asia Pacific markets proved satisfactory with sales increased by 9.9% to €70.9m and operating profits increased by 13.4% to €4.4m.
Australia showed a good recovery with encouraging business development across seasonings for meat and poultry applications and Pinnacle branded bakery ingredients. Progress continued in the quick-serve-restaurant sectors in Australia and New Zealand. Asian markets remain difficult due to prevailing economic conditions in major markets. However Kerry’s core business performed well. Market development opportunities in the Philippines, China, Vietnam and Thailand continue to be progressed.
