Kerry Group revenue increased by 13.3% €4.1bn in the first six months of the 2022, due to increased prices of 8.3% and sales volumes increase of 6.8%.
Earnings at the food group rose 13.1% to €518m at a margin of 12.8%, driven by benefits from operating leverage, mix, efficiencies and portfolio development but offset by inflation in the cost of raw materials.
Earning per share increased 9% to 176.4 cent on a constant currency basis, with basic earnings per share of 128.4 cent reflecting the impairment of the group's assets in Russia and Belarus.
Free cash flow of €226m, up slightly from €222m in the first half of 2021, represented cash conversion of 72%, the company said, with an increased investment in working capital being partially offset by lower net capital expenditure due to the timing of projects.
An interim dividend of 31.4 cent per share represents an increase of 10.2% year-on-year.
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“We are pleased with our overall performance and business momentum across the first half of the year despite inflationary challenges and geopolitical volatility in places, in what remains a highly dynamic marketplace," said Edmond Scanlon, CEO of Kerry Group.
"Volume growth was very strong in both retail and foodservice channels, driven by an increased level of innovation activity. This growth was broad-based across our regions, led by excellent performances in Beverage, Meat and Bakery end use markets in particular.
"We continued to make good progress in actively managing the unprecedented inflationary environment in conjunction with our customers, as we support them in developing their offerings to meet the rapidly evolving marketplace.
"We also made good strategic progress by expanding our footprint and completing a number of strategic acquisitions in the period. While recognising the marketplace is facing into a period of heightened uncertainty and volatility, this also presents significant opportunities. We remain confident in our outlook and are reaffirming our full year earnings guidance.”
Revenue in Kerry Group's taste & nutrition business rose 8.6% to €3.5bn, with earnings up a quarter to €515m, due to volume growth, price increases, favourable currency exchange rates, and a positive contribution from acquisitions net of disposals.
Volume growth was driven by emerging markets, the company stated, with strong performance in the Middle East, south-east Asia and Latin America offsetting challenging conditions in China, Russia and eastern Europe.
Sales volumes in the Americas rose 9.1%, and revenue in the region increased 29.1% to €1.9m, thanks to high levels activity across both the retail and food service channels in North America, but the company also performed well in Brazil and Mexico.
In Europe, volumes grew 7.1% and revenues rose 27.5% to €729m, with growth again in food service, strong menu development, and an increased level of seasonal products, and growth strongest in central and south Europe.
The group's Irish dairy business saw revenues rise 1.2% to €695m but earnings fell 52% to €38m despite prices for many products increasing significantly. Dairy ingredients achieved good volume growth, again with higher prices due to constrained global supply dynamics.
Photo: Edmond Scanlon. (Pic: Maxwells Dublin)
