Aryzta reports European success

17 Mar 2016

International specialty food business Aryzta has reported its 1H16 financial results. Overall revenues increased 5.5% to €1,960m, representing 0.2% underlying growth, but Food Europe revenues increased 9.5%.

Aryzta reports European success

International specialty food business Aryzta has reported its 1H16 financial results.

Revenues increased 5.5% to €1,960m, representing 0.2% underlying growth. Food Europe revenues increased 9.5% to €881.7m (4.7% underlying growth), while Food North America revenues increased 3.6% to €971.0m; (4.0% underlying decline). Food Rest of World revenues declined 7.2% to €107.3m.

“Underlying revenue growth momentum continued to improve, although still 18 - 24 months behind prior expectations,” said Aryzta Chief Executive Officer Owen Killian. “Free cash flow was strong during the period, as anticipated, and remains the key business focus. Underlying net profit from continuing operations remains flat. Speciality food is a growth segment of the overall food market in Europe and North America where consumer demand was positive in the period. ARYZTA is well-invested and well-positioned to grow, because its recently invested infrastructure is the most relevant and most competitive for this market.”

Revenue development has been erratic for the past 12 months and will be for a further 18 months as we commission and optimise our capacity. During this period, customer insourcing in Europe and contract renewal in North America will negatively impact revenue by circa 3%, as previously indicated. This will continue to be mitigated by cross-selling, facilitated by business optimisation and ATI. During this period, the best investor barometers will be free cash flow and underlying revenue growth, with more predictable ‘wins’ and lower ‘losses’. We are focused on establishing a sequential growth pattern and view short-term earnings guidance as less relevant, until we deliver on this priority. We are confident we can achieve our post 2020 strategic goals, for which the significant investment building blocks are in place.”