Ireland's Kerry Group has reported a 3.4% increase in reported revenue in the first quarter of its financial year.
The group, which owns the Cheestrings and Richmond brands among others, posted a marginal (0.2%) increase in volume, according to an interim management statement for the quarter ended 31 March 2020.
However, the group said that it has withdrawn its earnings guidance due to uncertainty around duration and impact of COVID-19.
"At Kerry, we recognise we have an important role to play throughout this crisis, and we have taken early and decisive action; protecting our 26,000 employees across our global footprint, working with our customers to ensure that products make their way to consumers around the world, while supporting our local communities," commented Edmond Scanlon, chief executive.
"Our global supply chain remains robust, thanks to the tremendous efforts of our operations teams right across our entire manufacturing footprint of 150 plants."
Good Underlying Performance
Scanlon highlighted that the group made a strong start to the year, with good underlying performance and particularly strong growth in the Americas.
"Since March, the restrictions on movement have significantly impacted customer demand beyond China and across the foodservice channel," he said.
"Based on the current restrictions, we expect the impact on second quarter performance to be much more significant than the first quarter."
Analyst View
Commenting on the group's performance, Jason Molins of Goodbody said, "In terms of outlook, management has withdrawn its guidance due to the uncertainty around the duration and impact of COVID-19 (previous guidance 5-9%). Kerry has confirmed its intention to maintain its final dividend of 55.1 cent.
"Following today’s update, we expect to materially lower our FY20 EPS forecasts though await more detail on recent trading and margin expectations before getting a better sense of the magnitude."
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
