Taste and nutrition firm Kerry Group has upgraded its full-year constant currency adjusted earnings per share (EPS) guidance after achieving an EPS growth of 9.1% in the first half of its financial year.
Group revenue in the first half amounted to €3.9 billion in the first half, with Kerry Group witnessing volume growth of 1.7%, the company added.
EBITDA for the period increased by 6.6% to €552.2 million, while EBITDA margin increased 160bps to 14.2%.
The company attributed this growth to the impact of its Accelerate Operational Excellence Programme, portfolio developments, operating leverage, product mix, and the net effect of pricing.
Kerry Group declared an interim dividend of 38.1 cents per share, up from an interim dividend of 34.6 cents last year.
Taste & Nutrition Division
The company's Taste & Nutrition division delivered volume growth of 3.1% in the first half, ahead of its end markets, which remained relatively muted through the period.
Its foodservice segment continued to perform strongly, registering volume growth of 7.3%, supported by new menu innovations, seasonal products, and implementation of measures to reduce operational cost and complexity.
Growth in the retail channel reflected good performances in the Americas and APMEA, the company added.
The division saw strong growth in the Middle East and Africa, with business volumes in emerging markets increasing by 6.6% in the first half.
Edmond Scanlon, chief executive officer of Kerry Group, added, “Taste & Nutrition volume growth was led by strong performances in the foodservice channel across all three regions, as we continue to support established foodservice chains evolve and develop their businesses, while working with emerging leaders to upscale their operations and offerings.
“Volume growth in the retail channel was driven by good performances in the Americas and APMEA, led by very strong growth in Snack applications with Kerry’s leading range of savoury taste profiles and Tastesense salt-reduction technologies.”
Dairy Ireland
The group's Dairy Ireland business reported a 19.9% increase in EBITDA to €35 million, with margin growth of 160bps in the first half.
This performance was driven by growth in Dairy Consumer Products and mix as well as recovery in the Dairy Ingredients segment.
Revenue in the division amounted to €592 million with volume and pricing down by 1.9% and 6.9%, respectively.
Volume growth in Dairy Consumer Products was led by Kerry’s snacking and branded cheese ranges, while Dairy Ingredients’ volumes reflected softer overall supply across the period due to local market conditions.
In the first half, Dairy Consumer Products stepped up the production of Cheestrings with the commissioning of its extended plant in Charleville, Ireland.
It also launched the new SMUG hybrid range of oat and dairy-based milk, cheese and butter products.
Market Outlook
Kerry Group noted that it is 'well positioned' for good volume growth and strong margin expansion despite a relatively subdued consumer market.
The group aims to continue to develop its business and portfolio aligned to its strategic priorities.
Scanlon added, “From a capital allocation perspective, we continued to invest to support the organic development of our business, while also completing the Lactase enzymes business acquisition and progressing our share repurchase activity through the period.
“Given the strength of our financial performance and our innovation pipeline, we are updating our full-year constant currency adjusted earnings per share guidance to 7% to 10%.”
