Lindt & Sprüngli Confirms 2019 Outlook, As US, Europe Post 'Solid' Results
Swiss chocolate maker Lindt & Sprüngli on Tuesday confirmed it expects organic sales growth of 5% to 7% in 2019 after an improving situation in the United States supported profit and sales growth in the first half of 2019.
Chocolate makers have been facing sluggish demand in saturated western markets, but Lindt's focus on faster-growing premium products, its own branded store network and a push into new markets has allowed it to buck that trend.
"The situation in the U.S., the world’s largest chocolate market, improved and the trading environment recovered slightly after several difficult years of restructuring," said the company based in Kilchberg, on the shores of Lake Zurich.
The Russell Stover business Lindt bought in 2014 achieved a sales plus for the first time in years and the group's U.S. unit overall reported "a sound results and market share gains following challenging previous periods", the maker of Lindor chocolate balls and gold foil-wrapped Easter bunnies said in a statement.
The 'North America' region achieved 'dynamic organic growth' of +7.2% in the first half, the company said in a statement.
In its 'Europe' segment, Lindt & Sprüngli generated sales of CHF 874 million in the first half of the year, equivalent to +5.0% organic growth.
The UK, Austria, Germany and Switzerland, as well as the Scandinavian countries, all recorded 'strong results', the company said, while Eastern European markets, including Poland, Russia, the Czech Republic, Slovakia and Hungary, did 'particularly well'.
Group net profit rose 2.4% to CHF 88.1 million (€80 million), while organic sales increased by 6.2% to CHF 1.76 billion (€1.60 billion), Lindt said.
The group confirmed it expected full-year sales growth this year to be within its target range of 5-7% and an operating margin improvement of 20-40 basis points.
Commenting on its overall first half performance, the company said, 'Strong seasonal business, the launch of numerous innovations within the leading product ranges and the own global retail network were the key growth drivers.'