Kerry Group plc (Tralee, Ireland) has announced interim results for the half year ended June 20, 2009, reporting a total sales revenue of 2,269 million euros (-3.2% from 2008 on like-for-like (LFL) basis). The company’s ingredient and flavors revenue for the period was broadly flat at 1,656 million euros, reflecting a 1% (LFL) drop from the previous year and a net volume growth of 1.7%.
In the Americas, Kerry’s culinary, wet/frozen sauce and savory/dairy flavor technologies performed well in the period; cereal and sweet technology segments saw a significant shift from premium lines to value menu offerings, and its overall sales volumes in the ice cream and frozen desserts were down. Growth in demand for “healthy” variants in the bakery sector continued to drive Kerry’s development of natural and gluten-free product offerings in this region, and demand for its shelf-life extender technologies increased. In the confectionery sector, dollar sales grew, but the unit sales and volume were lower due to a decline in demand for premium lines; beverage systems and flavors, however, outperformed market growth rates.
In the “challenging” EAME region, Kerry’s ingredients and flavors businesses reported revenue of 557 million euros (-1.3% LFL). The savory and dairy systems and flavors performed well in soups/sauce applications and the savory snack sector, and the Dera Holding NV savory flavorings business (acquired during the period) performed in line with expectations. The wet dairy ingredient systems, however, suffered considerable negative price pressure due to the significant reduction in dairy pricing. Kerry’s cereal and sweet technology segments were impacted by reduced demand for premium cereal, ice cream and indulgence line, and the confectionery industry saw a significant volume reduction; its sweet modulation and natural flavor technologies, on the other hand, continued to make good progress. The beverage systems and flavors performed well on an overall regional basis, with varied performance across individual market categories.
In the Asia-Pacific Region, Kerry’s ingredients and flavors businesses delivered solid market growth, despite a slow start to the year. Savory and dairy systems and flavors recorded continued strong growth in Asia; meat systems performed well in New Zealand and Thailand, but volumes were flat in Australia. Beverage applications achieved strong growth in Australia, Japan and Korea.
Of the future, Kerry Group chief executive Stan McCarthy said, “Kerry technologies and brands performed well in the difficult economic environment throughout global markets in the first half of 2009. … We expect to maintain the positive margin momentum in the second half of the year.”