Swiss dairy group Emmi has posted 7.1% year-on-year growth in sales in the first half of its financial year, to CHF 2 billion (€2.06 billion), despite a challenging environment.
However, the company witnessed a drop in net profit, to CHF 78.1 million, from CHF 98.7 million in the same period last year.
Sales growth was mainly driven by good performance in its international business, differentiated brand concepts, such as Emmi Caffè Latte and innovative desserts, as well as the recovery in the food service sector, the company noted.
EBIT for the period amounted to CHF 108.6 million, with an EBIT margin of 5.4%.
Urs Riedener, CEO of the Emmi Group, said, "The strong, broad-based growth in an increasingly challenging environment confirms our strategic focus on a diversified country and product portfolio as well as the targeted expansion of profitable niches.”
Divisional Performance
The company saw strong organic, price-driven growth in the Americas division (+11.8%) and Europe (+6.5%), while performance in its home market remained stable, registering an increase of 0.8%.
In the Swiss market, net sales amounted to CHF 808.1 million, up from CHF 801.8 million last year.
The Americas division, which includes Emmi Group companies in the US, Brazil, Spain, Tunisia, Chile, Mexico and Canada, generated sales worth CHF 798.6 million, up from CHF 668.0 million in the same period last year.
The company attributed this overall growth of 19.6% to the high, price-influenced organic growth of 11.8% and the integration of the Athenos business with feta specialties in the USA.
In Europe, which incorporates Emmi Group companies in Germany, Italy, the Netherlands, France, the UK and Austria, sales amounted to CHF 348.1 million, down 1.1% compared to CHF 351.9 million in the first half of 2021, due to negative acquisition and currency effects.
The company’s European unit accounted for 17.3% of group sales, while Americas and Switzerland accounted for 39.6% and 40.1%, respectively.
Outlook
Emmi retained its medium-term forecast adding that it remains well positioned strategically.
It expects EBIT in the range of CHF 265 million to 280 million, down from its previous guidance of CHF 290 million to 305 million.
Net profit margin is expected to range between 4.5% to 5.0%, up from its previous guidance of 5.0% to 5.5%, due to adverse conditions and high input costs.
For full-year 2022, the company expects organic growth of 5% to 6% (previously 2.5% to 3.5%), driven by higher input costs and inflation.
The company has forecast stable to slightly positive organic sales growth of between 0.5% and 1.5% for its Swiss division Switzerland, up from its previous outlook of -1% and 0%.
Organic growth in its Americas unit is expected in the range of 10% to 12% (previously 6% to 8%) and the forecast for Europe is 6% to 8% (previously 3% to 5%).
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Riedener added, "With differentiated brand concepts and a range of innovations, we again succeeded in getting people excited about our brands and products. Our locally anchored organisation has also taken targeted action to counter skyrocketing purchasing costs and ongoing supply chain disruptions, and the sales price increases we have introduced are starting to have an impact.
“I am confident that we will be able to achieve our revised full-year targets thanks to the commitment of our more than 9,000 employees, our clear strategic direction as well as operational efficiency, and further responsible price adjustments.”
© 2022 European Supermarket Magazine. Article by Dayeeta Das. For more fresh produce news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.
