Kerry reports 7.3% growth in like-for-like revenues

KERRY BRUSHED off the impact of input cost inflation to report a 7.3 per cent like-for-like increase in revenues for the first nine months of the year, though the company’s Irish consumer food division remained under pressure.

An interim management statement yesterday showed Kerry’s consumer foods division – which represents just under a third of the company’s sales – achieved 1.6 per cent volume growth in the nine months to the end of September, despite the impact of increased promotional activity. The volume rise was driven by a 2.8 per cent growth in the UK, with the Richmond and Mattessons brands performing strongly.

However, the division’s performance in Ireland deteriorated further in the third quarter, with volumes down 2 per cent in the first nine months, compared to a 1 per cent fall in the first half.

Kerry’s overall 7.3 per cent like-for-like revenue increase compares to an 8.4 per cent rise in the six months to the end of June. According to the company, Kerry “continued to achieve good organic growth in the three month period to September 30th, 2011,” despite the impact of continuing input cost inflation on some categories.

Kerry’s ingredients and flavours division, its main strategic focus for the last number of years, continued to see growth in the third quarter, with Kerry achieving 3.6 per cent growth in business volumes in the Americas region, a 2.6 per cent rise in the EMEA region, and a 10.1 per cent increase in volumes in the Asia-Pacific market.

Kerry, one of the world’s largest food and ingredients companies, acquired the flavours business of US food giant Cargill during the third quarter, as well as German flavours company SuCrest.

Last week, the Competition Commission in the UK provisionally cleared Kerry Group’s acquisition of British frozen food company Headland Foods. Headland performed “in line with expectations”, Kerry said yesterday.

Net debt at the end of the period stood at €1.2 billion, slightly higher than reported at the end of the second quarter, due primarily to exchange rate movements and investment in its ongoing efficiency programme, ‘1 Kerry.’

The company reiterated its full-year target of between eight and 12 per cent earnings per share growth. Kerry’s share price closed up just over a half a per cent yesterday in Dublin at €26.35.