French plant-based food company Bonduelle has reported a drop in its full-year operating profit, citing the COVID-19 crisis, unfavourable weather conditions impacting crops, wage inflation, and supply chain disruptions.
The war between Russia and Ukraine, once known as the breadbasket of Europe, has sent food and energy prices to record highs, while summer drought in key agricultural regions such as France shrunk grain harvests and cut inventories.
In addition, the ready-to-eat fresh activities of Bonduelle's Fresh Americas division declined over the year due to price increases aimed at preserving margins, a less dynamic market, and the cessation of sales of non-contributing ranges to certain clients, which was not offset by new contract wins.
The decline of the ready-to-use fresh food business in North America, which is weighing on the group's performance in the short term, "does not call into question the relevance of this acquisition," CEO Guillaume Debrosse said.
The group, which provides canned, frozen and fresh processed vegetables as well as ready-to-eat dishes, reported an operating profit of €96.6 million, excluding IFRS accounting effects, for the 12 months ended June 30, compared with €100.4 million a year earlier. This corresponds to a current operating margin of 3.3%.
The owner of Bonduelle and Cassegrain brands expects a revenue growth of 8% to 11% in the fiscal 2022-2023 with a current operating margin of 2.5%, citing the volatile environment and the partial sale of its long life activities in North America.
The group in August reported annual sales of €2.89 billion, up 1.8% on a like-for-like basis but below its own target of 3%.
Bonduelle also said it would propose a dividend payment of €0.30 per share at its annual general meeting on 1 December.