Covid-19 closures see fall in Lindt sales and profit for 2020
Chocolate-maker loses out as shoppers focus on stocking up on essentials and make fewer impulse purchases
Lindt’s sales were particularly affected by the restrictions on retail trade and the temporary closure of around 500 of Lindt’s own shops over Easter, normally a peak season for sales
Swiss chocolate maker Lindt & Spruengli said it expected its organic sales to fall around 5-7 per cent this year before bouncing back next year after Covid-related store closures hit sales and profit in the first half of 2020.
Chocolate- makers have been facing soft demand as many grocery shoppers focused on stocking up on essential supplies and made fewer impulse purchases during the Covid-19 pandemic.
“We expect organic sales in the full financial year to be around 5 to 7 per cent lower than 2019,” the maker of Lindor chocolate balls said in a statement on Tuesday, while it now expects a operating profit margin of around 10 per cent.
The company said the outlook was based on the assumption of no more large-scale lockdowns and a Christmas business similar to last year.
For the first half of 2020, Lindt report organic sales falling 8.1 per cent to 1.53 billion Swiss francs (€1.4bn), while net profit slid to 19.7 million francs, from 88.1 million francs in the year-ago period, Lindt & Spruengli said.
Sales were particularly affected by the restrictions on retail trade and the temporary closure of around 500 of Lindt’s own shops over Easter, normally a peak season for sales.
The group confirmed its mid-to long-term organic sales growth target of 5 per cent to 7 per cent year, and said it should be possible to exceed this range in 2021 due to the expected catch-up effect.
Operating profit should return to the level of around 15 per cent in 2022/23, and the operating margin should again improve by 20 - 40 basis points per year in the medium to long term, the group said. – Reuters