Lindt & Sprüngli has again booked organic sales growth ahead of the market, as share gains in “all key markets” drove sales throughout 2013.
In a sales update this morning (14 January), the Swiss chocolate group said organic sales rose 8.6%. Group sales increased 8% to CHF2.88bn (US$4.73bn), dented by currency exchange.
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Lindt said it saw “gains of market shares in all important countries and product categories as well as in the seasonal business” with organic growth underpinned by higher volumes. The group said revenue was up at a double digit rate in both the UK and US.
The company conceded it faced a number of challenges during the year, including rising raw material costs, price competition and “sustained economic weakness” in southern Europe. Nevertheless, Lindt said it anticipates EBIT margin gains to come in at the higher end of its strategic target of 20-40 bps improvement.
“Lindt’s sales figures support top line growth expectations of close to 8% annually over the next few years when we thought top line growth would decelerate toward the lower end of its 6-8% growth forecast amid bigger scale in the UK and US markets,” Kepler Cheuvreux analyst Jon Cox wrote in a note to investors.
“The company is a classy outfit and has a buyback (not utilised really so far) that can support the stock. However, in terms of valuation the stock has moved above its historical trading average and we suspect there is some M&A froth in the stock, which could go flat over the course of 2014,” he added.
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By GlobalDataLindt shares were up 1.26% at 12.35 in Switzerland today.
