ZURICH, SWITZERLAND — Higher cocoa bean prices, a foreign exchange loss and higher income tax expenses in the fiscal year ended Aug. 31 led to higher average financing requirements for Barry Callebaut, which in turn led to a 2.7% dip in net profits.
The Zurich-based company, a manufacturer of chocolate and cocoa products, was able to achieve sales volume growth of 4.5% in the fiscal year. The overall global confectionery market, meanwhile, experienced a 2.7% decline in the same time period, according to Nielsen.
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| Antoine de Saint?Affrique, c.e.o. of the Barry Callebaut Group |
“As we have done consistently for the last 10 years, we managed to outpace the market and delivered solid, profitable growth,” said Antoine de Saint?Affrique, chief executive officer of the Barry Callebaut Group. “After a slow start to fiscal year 2014-15, our volume growth accelerated, particularly during the last quarter, and reached 4.5% for the year, much in contrast to the global confectionery market. Sales volume growth was broadly based, driven by developed markets and supported by our key growth drivers — Outsourcing, Emerging Markets and Gourmet.
“Despite the historically weak cocoa products market and excluding a significant negative currency translation effect, we improved our operating profit. This is the result of our continued focus on product mix, margins and costs. I congratulate the team on this robust performance.”
Net profit of 239.9 million Swiss francs ($241.9 million) in the fiscal year compared with 255 million Swiss francs in the previous fiscal year. Sales volume of 1,794,782 tonnes was up from 1,716,766 tonnes. Sales revenue increased 12% to 6,241.9 million Swiss francs ($6,294 million) from $5,865.9 million Swiss francs.
In Region Americas, operating profit in the fiscal year was flat at 130.7 million Swiss francs. Sales volume rose 4.7% to 466,063 tonnes, driven by new regional accounts in Food Manufacturers and Gourmet. Sales revenue in Region Americas increased 12% to 1,507.9 million Swiss francs, but investments in structures in South America largely offset good volume growth and product mix.
In Region Europe, operating profit in the fiscal year rose 20% to 289.7 million Swiss francs, driven by better gross margins in Food Manufacturers and a contribution from Gourmet & Specialties. Sales volume in Region Europe increased 3.9% to 763,646 tonnes, and sales revenue rose 11% to 2,563.7 million Swiss francs.
In Region Asia Pacific, operating profit in the fiscal year increased 5.9% to 26.9 million Swiss francs. Volume growth rose 7.2% to 68,984 tonnes, and sales revenue increased 11% to 269.8 million Swiss francs.
In Global Cocoa, grinding over-capacity and low demand for cocoa products triggered a low combined cocoa ratio, which had a negative impact on profitability. Operating profit of 47.2 million Swiss francs in Global Cocoa was down 34% from the previous fiscal year.
The current cocoa products market temporarily will affect Barry Callebaut’s profitability in the 2015-16 fiscal year, Mr. de Saint?Affrique said. The company offered a mid-term guidance of 4% to 6% volume growth and EBIT above volume growth in local currencies on average for the period between 2015-16 and 2017-18, barring any major unforeseen events.
