Kerry makes €750m profit as McCarthy steps down
Food and ingredients giant names Scanlon as new ceo
Shares in Kerry Group soared as much as 6pc yesterday after the global food and ingredients giant announced strong results for 2016 and confirmed the appointment of a successor to chief executive Stan McCarthy.
While the company's revenue was virtually unchanged on 2015, at €6.1bn, its reported business volume growth jumped 3.6pc. Kerry's adjusted earnings per share rose 7.1pc, but was 12.3pc higher on a constant currency basis.
It made a €750m trading profit last year, which was 7.1pc higher than in 2015.
The company, with a market capitalisation of almost €13bn, announced that its Asia-Pacific chief executive, Edmond Scanlon, would succeed Mr McCarthy on October 1.
Mr Scanlon joined Kerry Group in 1996 after graduating from University College, Cork. He has held a number of senior roles at the company.
He said he was "honoured and privileged" to take over as chief executive of the company, which employs more than 24,000 people around the world.
Mr McCarthy said Kerry had delivered record free cash flow of €570m in what remains a competitive market.
He told investors that changes in the market were happening at an "accelerating pace" and driving innovation, with "health and wellness trends pervasive across all sectors".
Kerry generated €4.88bn of its revenue from its taste and nutrition division last year, with the remaining €1.3bn derived from its consumer foods unit.
Its consumer brands include Denny, Cheestrings, Shaws and Kerrymaid.
Of the taste and nutrition revenue, just under €2.6bn was generated in the Americas.
Mr McCarthy said the division had experienced a "very strong quarter".
He added that food service was continuing to outpace retail.
Kerry Group noted that health and wellness trends combined in the Americas to "drive growth in demand for clean-label, organic and 'free-from' lines", which contributed to increased fragmentation in the marketplace and growth of niche categories.
The company also noted that developing markets accounted for 26pc of its business last year, compared to 21pc in 2011, and 19pc in 2008.
Kerry spent about €1bn on acquisitions in 2015, including €640m it paid for three US firms. Mr McCarthy pointed out that had it not been for that significant acquisition spend in the US, developing markets might have now accounted for a larger slice of Kerry's overall business.
Mr Scanlon's experience in Asia will also likely sit well with investors.
Kerry shares closed up 3.9pc.