Kerry Group issues upbeat trading statement

KERRY GROUP brushed off the potential impact of currency movements and rising input prices on profits yesterday, issuing an upbeat trading statement to the market in which it stated it is on track to deliver full-year growth.

The food and ingredients company reiterated its guidance of mid-teen growth in adjusted earnings per share for the full year.

Kerry also confirmed that it had acquired a small California-based company, Agilex Flavors.

While the acquisition spend will not be revealed until year-end, it is understood that Agilex has annual revenues of not more than $50 million.

Kerry’s total revenue in the nine-month period increased by 8.7 per cent compared to the same period in 2009, equating to an increase of 3.5 per cent on a like-for-like basis.

The company’s ingredients and flavours business continued to be the main driver of growth, increasing by 6 per cent, compared to a 3.5 per cent increase in its consumer foods division.

Despite an increase in raw material input costs the company’s ingredients and flavours business continued to see growth across all regions. Business volumes in America were up 5.2 per cent, the EMEA region saw 4.3 per cent growth, while Asia-Pacific markets grew by 15.8 per cent.

Within its consumer foods divis- ion, Kerry’s Irish brands, which include Denny, Dairygold, Shaws and Galtee, returned to growth.

The UK market saw double-digit growth for Richmond in the sausage sector, the company said, while Wall’s made “good progress” in savoury pastry products and Mattessons continued to grow the meat snacking segment.

The company’s net debt stood at €1.04 billion at the end of the period, €160 million below that reported at the half year, though €60 million of this was due to weaker currencies.

Kerry’s trading profit margin increased by 30 basis points – allowing for unallocated development costs relating to the company’s global IT project. This overall margin growth comprised a 50 basis points improvement in ingredients and flavours and a 40 basis points increase in consumer foods.

Kerry Group shares closed up just over 1 per cent yesterday at €26.70.