Swiss chocolate maker Barry Callebaut has confirmed its mid-term targets and raised its dividend after profit and volume growth beat forecasts in its 2020/21 financial year.
The global chocolate market has seen sluggish growth recently, but Barry Callebaut is doing better thanks to pandemic-weary customers returning to cafes and bakeries for chocolate cakes while big food groups are still keen to outsource chocolate production to the Zurich-based group.
"As we get out of the pandemic, we'll see traditional distribution channels come back strongly and that will further help us to grow and accelerate the performance," chief executive Peter Boone, who took over in September, told reporters on a call.
Higher Raw Material Prices
He said the company's policy of passing on higher raw material costs to customers didn't mean Barry Callebaut was immune, but offered some protection in the current inflationary environment.
Cocoa bean prices fell in 2020/21 due to a large cocoa bean surplus, but Boone said he expected improving demand to lead to a more balanced situation in the current fiscal year.
Net Profit Gains
The world's biggest chocolate maker, which recently extended its chocolate supply agreement with Hershey, said its net profit for the year to Aug. 31 rose by 20.4% to CHF 384.5 million, ahead of a forecast for CHF 378.2 million in a Refinitiv poll of analysts.
Sales volumes increased by 4.6% and revenue reached CHF 7.208 billion, the group said, also beating forecasts.
It confirmed its target of average annual volume growth of 5%-7% in the three-year period to 2022/2023.
Barry Callebaut, which recently named a number of new appointments to its executive committee, raised its dividend by 27% to 28 Swiss francs per share for 2020/21.
Its shares, up less than 3% so far this year, were indicated to open 0.9% higher in a lower market.