‘Good momentum’ for Kerry’s business as group grows volumes

Global taste and nutrition and consumer foods group Kerry said its business saw good momentum through the first quarter of the year, despite the ongoing pandemic.

Business volumes grew 1.9 per cent in the quarter ended March 31st, it said, with taste and nutrition up 2 per cent, and consumer foods increasing by 1 per cent.

The business has experienced variable market conditions as some countries reopened and consumer confidence increased, while others continued to experience local restrictions.

At-home consumption has remained higher than usual as people continue to work from home, with the overall recovery in the food service channel slowing over the three months before showing good signs of recovery on advanced vaccine rollouts.

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"We saw significant variability and highly dynamic market conditions right across our end-use markets, channels and regions. Against this backdrop, I am very pleased with the business momentum we saw as we moved through the quarter," said chief executive Edmond Scanlon.

“Our performance reflected sustained strong growth in the retail channel, while the foodservice channel continued to be impacted by increased restrictions in many local markets, before returning to growth in March.”

Momentum

He said the Asia Pacific, Middle East and Africa region delivered strong growth throughout the quarter, with volume up 11.7 per cent. Europe was impacted across the region. The Americas had a strong finish to the quarter, Mr Scanlon said.

“The good business momentum has been supported by an increase in the level of innovation in a number of key markets. This momentum combined with an overall improvement in market conditions, gives us increased confidence in the full year outlook, where we are expecting to achieve strong volume growth and are guiding adjusted earnings per share growth of 11 to 15 per cent in constant currency.”

The group said the strategic review of its dairy-related businesses in Ireland the UK is ongoing and it would continue to invest in the wider group for growth and enablement of our business model, and also pursue mergers and acquisition opportunities.

Looking ahead, the group expects to deliver strong volume growth and adjusted earnings per share growth in 2021 of 11 per cent to 15 per cent on a constant currency basis.

Kerry also held a virtual annual general meeting on Thursday with shareholders voting on the various resolutions in advance of the meeting.

Mr Scanlon declined to comment on a question about why a possible deal with Kerry Co-op, which would have seen its legacy dairy and consumer foods division, which includes the popular Dairygold, Charleville and Denny brands, spun out in a joint venture with the co-op.

The company announced it had suspended talks with the co-op earlier this month.

“It would be completely inappropriate to comment on these confidential discussions,” Mr Scanlon said.