Kerry Group has posted revenue of €689 million in its Consumer Foods division, which includes brands such as Cheestrings and Richmond, in the first half of its financial year.
The group said that volume growth in Consumer Foods was up 0.6%, while it maintained its trading margin of 7.0% in the division, despite incurring Brexit risk management costs.
'The market landscape continued to be challenged in the period,' Kerry said in a statement. 'Lower consumer confidence was reflected through a more cautious consumer, while structural changes across the retail environment continue to drive change along the end-to-end supply chain.'
The group said that its Richmond brand delivered a 'strong performance' in the period, driven by positive growth in chicken sausages, while the Denny brand in Ireland experienced 'strong growth'. Its spreads category 'continued to be challenged', however.
The Cheestrings brand, meanwhile, also recorded 'strong growth', due to a number of innovations, while Fridge Raiders embarked on a product extension to 'reach a broader consumer market'.
The group said that it plans to cease operations at its production facility in Burton, UK, from the start of September, and is currently seeking alternative solutions for the site.
Taste & Nutrition
Elsewhere, Kerry's Taste & Nutrition business, which encompasses the majority of its sales, saw 3.8% volume growth in the period, 'as demand for great-tasting products with improved nutritional attributes continued to accelerate across the globe,' the company said.
The division posted revenue of €2.915 billion, and improved its trading margin by 20 basis points to 13.3%. In the Americas region, Kerry Taste & Nutrition posted 2.7% volume growth, while volume growth in Europe was up 2.2%, and in the APMEA region, volume growth of 9.6% was recorded.
Overall, group revenue at Kerry Group was €3.6 billion for the half year period, reflecting 3.3% volume growth.
“We are pleased with business performance in the period, as the Group continued to deliver volume growth ahead of the market while expanding trading margins in line with expectations," commented Edmond Scanlon, Kerry Group chief executive.
"While heightened consumer pricing and uncertainty impacted market volume growth rates in some developed markets, our unique and industry-leading business model and integrated taste and nutrition positioning continued to deliver significant value for our customers in meeting rapidly evolving consumer needs."
Scanlon noted that the group is "excited" by the ongoing enhancement of its product mix and innovation pipeline.
"Good progress has been made on the integration of recent acquisitions, which are performing very well," he said. "We are updating our guidance and expect to achieve growth in adjusted earnings per share of 7% to 9% in constant currency.”
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.