Barry Callebaut improves in difficult climate

Related tags Generally accepted accounting principles Marketing Earnings before interest and taxes Barry callebaut

Swiss chocolate manufacturer Barry Callebaut has reported an
increase in pre-tax profits for the 2001/02 year despite a decline
in volumes and higher raw material costs. Nwe product launches at
the premium end of the market have helped maintain profitability.

Despite sharp rises in raw material prices, Swiss chocolate manufacturer Barry Callebaut has reported a profit and dividend increase on a decent sales growth for its 2001/02 business year.

Earnings before interest and tax (EBIT) rose 3 per cent to SF173.2 million (€118.8m) and sales revenue increased by 3 per cent to SF2.62 million - in local currencies an increase of 8 per cent. But sales volumes decreased by 3 per cent to 760,680 tons due to the deliberate reduction of semi-finished products sold to third-partycustomers, a volume decline in the Vending Mix business (cocoa mixes for beverage machines) and the sale of the Chocodif and the Gummi-Bear businesses.

Andreas Schmid, chairman of the board and CEO until 31 May this year, said: "We are pleased with the results achieved. Despite a difficulteconomic background, we were able to further improve our operational performance and build a solid foundation for the future."

The chocolate company​ witnessed a 3 per cent rise in operating profit to SF173.2 million with net profit increasing 5 per cent from the previous year to SF101.6 million.

In a statement on Wednesday, the company stressed that despite the global market for cocoa beans experiencing a sharp price increase of more than 80 per cent during the year under review, the company's margins are not, apparently, linked to cocoa prices. They are "a reflection of the products made for customers and the services provided to them as well as of the competitive environment ineach business unit".

However, the impact of this steep rise in cocoa prices, to levels last seen in the 1980s, was clearly felt in the Food Manufacturers business unit of the company. Sales here dropped by 2 per cent to SF1.39 billion (53 per cent of group sales revenue) and sales volumes dropped slightly, due to lower sales in Eastern Europe and in the Middle East.

Inthe area of product innovation, the company said that it had focused on developing premium products such as organic chocolate, chocolate without added sugar for diabetics or novel kinds of chocolate enriched with oligo-fructose or inulin.

Current CEO Patrick G. De Maeseneire, commented: "We have set ourselves ambitious goals. Barring any extraordinary events, we are targeting an operating profit (EBIT) in excess of SF200 million in fiscal 2002/03. Each one of our business units has the necessary strategy andorganisation in place, and I am confident that we will reach our performance targets".

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