Revenues at Cuisine de France owner Aryzta see marginal growth in first quarter

Swiss-Irish baker says it generated revenues of €514m in the quarter, up 0.1% and in line with expectations

Swiss-Irish baker Aryzta grew revenues marginally in the first quarter of this year, the group told investors on Monday.

Aryzta is best known in Ireland as the owner of the Cuisine de France brand. It supplies par-baked goods to customers ranging from McDonald’s and Subway to Lidl, Aldi and Dunnes Stores.

In a note to investors, it said it generated revenue of €514 million in the quarter, which represented organic growth of 0.1 per cent and was in line with expectations.

Positive volume and price effects were partially offset by negative mix effects, with the latter continuing to improve in line with previous guidance.

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Europe compensated for weakness in the group’s “rest of world” division, as performance improved gradually through the quarter.

“Innovation continues to enable the business to selectively optimise its portfolio range and exit lower-margin products,” the group said.

“This, along with the ongoing cost initiatives and efficiencies, ensures the business remains on track to improve performance.

“The results highlight the expected normalisation of growth due to the reduced pricing effect, impact of portfolio optimisation, strong prior-year comparable growth, geopolitical impacts and the effect of higher cost of living on consumer spending.”

Aryzta interim chief executive Urs Jordi said revenue developed in line with guidance as growth improved gradually through the quarter.

“We expect this progressive trend to gradually continue,” he said. “The business continues to manage the ongoing inflationary challenges while delivering cost and footfall advantages to customers.

“Innovation is supporting portfolio optimisation which, along with the ongoing cost initiatives, ensures the business remains on track to deliver an improved performance.

“We reiterate our guidance to deliver low to mid-single digit organic growth for the 2024 financial year. Aryzta remains focused on delivering the midterm targets through organic growth, business improvement, free cash generation and total net debt reduction.”

Meanwhile, three former executives with Aryzta have joined its one-time chief executive Kevin Toland in launching legal cases against the Swiss-Irish baked goods group stemming from their exits in late 2020.

They include Aryzta’s former chief executive for Europe Gregory Sklikas, its chief people officer Tony Murphy, and one-time chief commercial officer of Aryzta North America John Heffernan, according to court filings last week.

All four are suing for “specific performance”, according to court records, signalling they are seeking compensation for amounts they claim they are contractually entitled to.

All four men left Arzyta in late 2020 following a boardroom coup that saw Mr Jordi take over as chairman that September, before becoming interim CEO two months later as Mr Toland exited the business.

Colin Gleeson

Colin Gleeson

Colin Gleeson is an Irish Times reporter