IRELAND – Food ingredients specialist Kerry Group has posted revenue growth of 16.1% for the three months to the end of September despite increasing products by more than 10% in response to inflationary pressures.
The food technology and ingredients company said the revenue increase in the period comprised of volume growth of 6.6%, with the contribution from business acquisitions of 4.8% partially offset by the impact of the business disposal of the Consumer Foods Meats and Meals business of 12.7%.
The company underscored that consumer demand continued to be strong through the period despite geopolitical volatility and inflationary headwinds.
Consumer preferences for new taste experiences, clean labels, and healthier options remained prevalent, while the importance of value options continues to rise across categories.
In its Taste & Nutrition division, Kerry reported strong business volume growth across regions, channels, and end-use markets with strong third-quarter growth of 8.2%.
Dairy Ireland division also reported “solid” growth 0f 1.8% despite seeing what the company called “significant price inflation” which resulted in significant price increases across the business.
Kerry noted that the prices for the products in the Dairy Ireland Division remained significantly higher due to constrained global supply dynamics.
Business volumes in emerging markets increased by 12.3%, as strong growth in LATAM, the Middle East, and Southeast Asia was partially offset by challenging conditions in China.
While business volume grew by 9.3% across regions, channels, and end-use markets in the Americas region led by Beverage, Meat, and Bakery businesses, European business saw overall volume growth of 6.2% with Q3 growth of 4.4% led by Snacks, Dairy and Meals categories.
In the Asia Pacific/Middle East/Africa region, overall volume growth of 9% was observed with continued strong Q3 growth of 8.6% led by Snacks, Meat, and Bakery markets.
Edmond Scanlon, Kerry CEO stated: “Our volume growth was broad-based across our regions, channels, and markets, led by excellent performances in Snacks, Beverage, Meat, and Bakery in particular. We also made good strategic progress with further footprint expansion and strategic acquisitions.”
“While we recognize the current level of uncertainty in the marketplace, we feel very well positioned as we continue to support our customers in addressing the various market challenges and opportunities. Given we have now reported the third quarter, we are updating our full-year earnings guidance of 6% to 8% growth on a constant currency basis.”
The Group’s EBITDA margin decreased by 40 bps, primarily driven by the significant impact of passing through input cost inflation, partially offset by accretion from portfolio developments, operating leverage, portfolio mix, and efficiency initiatives.
In an update of its Full year’s guidance, Kerry expects to bag a 6% to 8% growth on a constant currency basis.
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