Kerry Group plc ((IE:KRZ)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Kerry Group’s recent earnings call exuded a positive sentiment, highlighting robust volume growth and margin expansion. The company demonstrated resilience through innovation and strategic developments, despite facing challenges in China and currency headwinds.
Strong Volume Growth and Margin Expansion
Kerry Group reported a commendable 3% volume growth year-to-date, surpassing the end market performance. This growth was complemented by a significant EBITDA margin expansion of 90 basis points, attributed to operational excellence and improvements in product mix.
Foodservice and Retail Channel Success
The company experienced a 4.1% growth in the foodservice sector, driven by innovative new menu items and seasonal launches. Retail growth was also notable, supported by renovations focused on nutritional enhancements.
Strategic Developments and Innovations
Kerry Group made significant strides in strategic developments by inaugurating a state-of-the-art Biotechnology Centre in Leipzig, Germany. Additionally, the Accelerate 2.0 program was launched, emphasizing footprint optimization and digital excellence.
Positive Outlook and Guidance
The company maintained its full-year adjusted EPS guidance, forecasting a 7% to 11% growth in constant currency. This outlook underscores Kerry’s strong market positioning and commitment to strategic innovation.
Challenging Market Conditions in China
Despite the overall positive performance, Kerry faced challenges in China, with volumes remaining under pressure. This prompted the company to adjust its strategy, focusing on growth in regions outside of China.
Currency Headwinds
Kerry Group encountered a 3.6% adverse currency impact, primarily due to movements of the U.S. dollar and emerging market currencies against the euro.
Soft Market Dynamics in Western Europe
In Western Europe, retail volumes reflected soft market dynamics, necessitating a refreshed approach to sustain growth.
Forward-Looking Guidance
Kerry Group reiterated its strong performance expectations with a 3% volume growth year-to-date, driven by new product launches and innovation. The company remains optimistic about its full-year adjusted EPS growth guidance of 7% to 11% in constant currency, supported by strategic innovation and renovation partnerships.
In conclusion, Kerry Group’s earnings call highlighted a positive trajectory with strong volume growth and margin expansion. Despite facing challenges in China and currency headwinds, the company’s strategic developments and innovations position it well for future growth.