Italy's Massimo Zanetti Beverage Group (MZBG) closed the first nine months of its financial year with a loss of €20.5 million, down from a profit of €8.1 million in the same period last year.
On a consolidated basis, the roasted coffee producer and distributor reported a gross profit of €256.7 million, down 14.4% due to the decrease in gross profit from the sales of roasted coffee and exchange rate fluctuations.
Consolidated revenues decreased by 8.4% to €610.6 million in the period.
The company attributed this decline to a 6.7% drop in roasted coffee sales due to the COVID-19 pandemic.
Main Sales Channels
In terms of the company's main sales channels, foodservice reported revenues of €106.9 million (-33.3%), while the mass market channel saw revenue increase by 8.4% to €256.67 million.
Revenues in its private label division amounted to €207.55 million, down 6.8% year-on-year.
The company's adjusted EBITDA fell from €58.2 million to €28.3 million, consolidated net financial debt improved by €32.8 million, compared to 31 December 2019, to €299.3 million, for a negative free cash flow of €18.1 million.
Roasted coffee volumes reached 94.0 thousand tonnes (-6.1% year-on-year) in the first nine months.
Regional Performance
The Americas region recorded 6.7% growth in revenue. driven by the mass market and food service on a comparable basis, while volumes declined by 3.8%.
Northern Europe recorded a 0.6% increase in volumes due to the positive performance of the mass market channel, while Southern Europe saw a 15.1% decline, particularly impacted by the weak performance of the foodservice and private label channels.
The company's Asia-Pacific and Cafés division reported a 19.0% decline (-22.0% on a comparable basis) in revenue due to the foodservice and private label channels, partly offset by the growth of the mass market channel.
Outlook
Massimo Zanetti, chairman and director of the Group, said that the company's outlook remains uncertain, “especially in light of the recent rise in contagion”, which has already led to new selective closures in various markets.
The group is implementing cost containment actions in all geographical areas.
As a result of the new pandemic phase, according to Zanetti, the last quarter of the year “could also be strongly influenced by the health emergency and the operating restrictions necessary to contain its spread, which makes any kind of forecast extremely complex".
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. Click subscribe to sign up to ESM: The European Supermarket Magazine.
