Swiss-Irish bakery firm Aryzta posted a group organic revenue increase of 0.7% in the first half of its financial year, however, total revenue was down by 4.2%.
The group reported that the performance marks the ‘first step towards delivery of a multi-year turnaround commitment’.
Here's how leading industry analysts viewed the firm's performance.
Jason Molins, Goodbody
"Aryzta has, this morning, reported H119 results with underlying EBITDA coming in at €151.6 million – 3% ahead of our €147 million forecast. With group organic revenues showing further signs of stabilisation – Q1 +0.3%, Q2 +1.0% – it is encouraging to see Aryzta starting to deliver on its multi-year turnaround.
"Project Renew has started well, particularly in North America, helping to deliver an underlying group EBITDA margin of 8.9% – down ten basis points year on year – but ahead of our anticipated 30 basis-point decline. Adjusted EPS came in at 6.0c, which was [approximately] 7% ahead of forecast, driven by the underlying EBITDA beat, as well as a stronger PAT contribution from Picard – better finance costs and lower tax outcome helping offset lower EBITDA performance.
"Overall, following today’s update, we are likely to nudge up our FY19 forecasts, where we currently anticipate a 4% underlying EBITDA improvement."
Cathal Kenny, Davy
"With H1 margin in North America expanding year on year for the first time since 2014, we believe a pathway to stabilisation is now emerging at Aryzta. Group margin was broadly flat year on year – 40 basis points ahead of forecast – as self-help measures start to accrue.
"Despite a higher-than-anticipated working capital outflow, the statement provides a good foundation for attainment of full-year forecasts. We envisage no material change to FY 2019 EBITDA forecasts."
Cantor Fitzgerald
"Aryzta’s share price has risen by 10% this morning, after releasing a solid set of H1/19 results. Headline figures beat expectations, margins held up, and guidance for the full year was reiterated. H1/19 revenue fell by 4.2%, to €1.71 billion, in line with consensus expectations. H1/19 EBITDA fell by 6%, to €151.6 million, ahead of expectations. H1/19 profit fell by 22.5%, to €39.5 million – again, ahead of expectations.
"Underlying geographies revealed some positive developments. In Europe, it posted 1.9% organic revenue growth. Switzerland Poland and France all showed improvements. However, insourcing remains an issue in Germany. In North America, organic revenue declined by 1.8%, but margins expanded by 40 basis points. The rest of the world maintained solid growth, with organic revenue rising by 6.7%.
"All in all, these were a good set of results for Aryzta, as it attempts to deliver on its transformation plan through Project Renew and a focus on the B2B market."
© 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.
