Financial results

High price of cocoa and dip in demand for chocolate sees lower sales volumes for Barry Callebaut

By Anthony Myers

- Last updated on GMT

Barry Callebaut has introduced the 100% plant-based Callebaut NXT and SICAO Zero in Mexico. Pic: Barry Callebaut
Barry Callebaut has introduced the 100% plant-based Callebaut NXT and SICAO Zero in Mexico. Pic: Barry Callebaut

Related tags Barry callebaut Chocolate Cocoa Confectionery

Barry Callebaut has reported lower nine-month sales volumes in its 9-Month Key Sales Figures for Fiscal Year 2022-23 after being hit by growing global inflationary pressures and the high price of cocoa on the commodity market that pushes up the price of chocolate, further dampening demand.

A salmonella outbreak at the Group’s main Wieze plant last year also hampered the Group’s volumes. “In the first nine months of the fiscal year, we witnessed soft volume in a continued inflationary environment which affected customer demand. Our volume was in line with the declining underlying chocolate confectionery market, excluding the residual effects of the Wieze incident. The recently announced renewal of a global strategic partnership with a key customer underpins the sustained trend toward outsourcing. It is a showcase for the added value we can deliver to customers globally and for the deep relationships our teams are building every day​,” said Peter Feld, who took over from Peter Boone as chief executive in April.

In a media statement, the Group said sales volumes in the nine months ended 31 May 31 fell 2.7% compared with the same period a year ago to 1.7 million tonnes, in line with analysts’ forecast in the company-provided consensus. Barry Callebaut is the largest supplier of chocolate, cocoa, and other ingredients to a range of industry producers, including Unilever and Nestle.

Strategic milestones

Expansion: In June 2023, Unilever, a global market leader in ice cream, extended its long-term global strategic agreement for the supply of cocoa and chocolate from Barry Callebaut. The renewed agreement, originally signed in 2012, foresees intensified collaboration in the areas of innovation and sustainability. Barry Callebaut will focus on delivering the latest chocolate innovations for ice cream to Unilever and as a result drive strategic, long-term growth globally.

Innovation: In May 2023, Barry Callebaut launched in the Mexican Gourmet market Callebaut NXT, a dairy-free delight made with 100% plant-based ingredients, and SICAO Zero, a sugar-free chocolate. With the launches, Barry Callebaut is responding to the growing demand for "mindful indulgence" by offering healthier chocolate alternatives without compromising taste.

Cost Leadership: In May 2023, Barry Callebaut held a ground breaking ceremony for its new cocoa bean warehousing and dispatching facility in Pasir Gudang, Malaysia. The facility, which spans across more than half a million square feet, will increase operational efficiency and support Barry Callebaut's growth plans in the Region.

On June 15, 2023, the USD 400 million senior bond was fully repaid at maturity. Thanks to the Group's strong structural cash generation, no new fundraising was needed, hereby further reducing the gross debt of the Group.

Sustainability: In May 2023, Barry Callebaut added fresh ambition to its Forever Chocolate plan, building on the insights gained during the past six years. By setting additional measurable targets for 2030 and beyond, the Group is committed to driving long-term systemic change for a sustainable cocoa supply chain.

The company confirmed its guidance of no volume growth for the year but said it would provide a full strategic update at a full-year earnings publication in November. The Zurich-based firm cut its guidance twice this year as it struggled to recover from a dip in chocolate purchases by its inflation-hit customers, Reuters also reported. Barry Callebaut’s nine-month sales revenue rose to 6.29 billion Swiss francs ($7.27bn), also in line with analysts’ estimates.

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