Revenue falls at food group Aryzta

Underlying revenue at food group Aryzta fell in the year to July 31st as conditions for consumers remained challenging, the company said today.

Group revenue declined by 8.6 per cent to €3.01 billion for the year, with underlying food revenue down 6.7 per cent to €1.68 billion. Origin reported underlying earnings growth of 3 per cent for the period.

However, operating profit rose 2.2 per cent to €305 million, and earnings per share increased 4 per cent to 244 cent.

The food group business in Europe was facing tough conditions, Aryzta said, with underlying revenue down 8.2 per cent and operating profit falling 2.9 per cent to €131.2 million. Markets in Ireland and the UK were particularly hard hit.

“Convenience retail and foodservice on the island of Ireland and the UK were the most severely impacted channels and markets. Continued pressure on the consumer in Europe and North America made for a challenging year,” the statement said.

“In Europe, the decline in revenue has been mostly evident in the UK and Ireland. The consumer has endured stringent austerity measures, significantly impacting their disposable income.”

Chief executive Owen Killian said the company had responded to the difficult environment by focusing on operating efficiencies, cost management and innovation.

“The operating environment is likely to remain difficult in many key markets. Aryzta’s business model is therefore focused on operational resilience, while remaining well positioned to benefit from any economic recovery,” he said.

In North America, revenues declined 4.3 per cent to €571.6 million, while operating profit grew by 3.6 per cent to €69.9 million.

Davy analyst John O’Reilly said he was expecting synergies from acquisitions in time.

Shares in Aryzta fell 2.4 per cent to €33.20 on the Dublin market this afternoon.