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Lindt & Sprüngli Group has achieved “robust” sales and profits growth in a “successful” first half of 2024, but the Swiss chocolatier warned of ongoing challenges caused by record high cocoa prices.
Organic sales increased 7% to CHF 2.2bn (£1.9bn), supported by mid-single digit price hikes to offset the surge in cocoa prices.
While global demand has been hit by the sharper prices, Lindt showed “strength and resilience” as it grew share in all its important markets and boosted volumes by 0.9% in the half.
“While energy prices and supply security have stabilised, and prices for other raw materials and packaging have remained constant, the cost of cocoa continues to be a challenge, reaching record levels,” Lindt said.
Lindt said it would partly mitigate the impact of rising cocoa prices through strict cost management, but added further price increases would be needed.
In Europe, Lindt grew organic sales by 9.3% to CHF 1.1bn, with growth the most pronounced in the UK, France and Central and Eastern Europe. where the group recored double-digit rises.
The group also showed positive growth in North America and the rest of the world.
Operating profits for the half increased to CHF 292.3m, while EBIT margin improved to 13.5% from 12.2% in 2023.
Lindt is confident it will reach the objectives announced for the full year, with sales growth in the range of 6-8% and an EBIT margin increase expected at the upper end of the 20–40 basis points range.
Morning update
Grocer tech provider Eagle Eye is expecting another year of profitable growth as it secured new customers in the UK, North America and Australia, and expanded with existing customers Tesco, Morrisons and Asda.
Group revenues increased 11% to £47.7m in the year to 30 June, with adjusted EBITDA up 28% to £11.3m.
CEO Tim Mason said in the full-year trading update: “The world of loyalty is evolving at pace. At the vanguard of this movement are the grocers, for whom loyalty increasingly means personalised promotions, due to their proven ability to delight customers and increase loyalty, profitably.
“Our ability to support personalised promotions at scale, and the increasing opportunities presented by our new AI-based offerings, mean we are the acknowledged leaders in this market.
“The strength of our customer base helps to drive interest from some of the world’s largest retailers as we continue to capture what is a sizeable, long-term growth opportunity.”
Compass Group has boasted of “another strong quarter” as organic growth jumped 10.3% in the three months to 30 June.
The catering giant said all regions continued to perform well in the third quarter, with an “exciting” pipeline of new business opportunities.
Growth in Europe hit 12%, while sales rose 9.9% in North America and 8.5% in the rest of the world.
New business growth accelerated in Q3, while pricing moderated in line with inflation.
Volumes continued to benefit from the quality of the offer and the value gap compared with the high street, the group said.
“We are pleased with our third quarter performance,” Compass added in the short trading update. “The group delivered good growth across all regions and benefited from improved net new business in line with our expectations.”
For the full year, Compass forecast underlying operating profit growth to be above 15% on a constant-currency basis, with organic revenue growth above 10%.
Yesterday in the City
The FTSE 100 climbed 0.5% to 8,198.78pts yesterday.
Ocado shares soared 11.3% to 420.7p as the grocery tech firm revealed a strengthening of its partnership with Kroger. The stock has been on a rollercoaster this year, with a 10% slump caused by a Bernstein downgrade last week before a partial recovery following its latest financial results. Shares are up 36% over the past month but remain down by 43% in the year to date.
Other risers yesterday included Just Eat Takeaway, up 1.9% to 932p, Kerry Group, up 2.3% to €80.10, and THG, up 1.7% to 64.3p.
Virgin Wines and McBride led the fallers, down 4.7% to 41p and 2.3% to 129.5p respectively.
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