Growth in China underpins 'solid' start to year at Kerry
KERRY Group reported what it called a "solid start" to the year yesterday, boosted by growth in China and other developing markets.
In a trading update before its annual general meeting in Tralee, the Irish food giant said sales were up 10.3pc in the three months to the end of March.
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"With a strengthening innovation pipeline and mergers and acquisitions noted as performing very well, Kerry remains well placed," Liz Coen, analyst at Davy Stockbrokers, said.
"We reiterate our 'outperform' rating," she added.
Kerry itself re-affirmed its full-year financial guidance for adjusted earnings per share growth of 6pc to 10pc.
Business volumes grew 3.3pc during the period. The taste and nutrition arm recorded growth of 3.8pc, while consumer foods grew 0.8pc.
Kerry's CEO Edmond Scanlon said the business was delivering volume growth that beat market expectations and growing margins.
"We have made a solid start to the year with overall business performance in line with expectations."
Recent acquisitions had performed "very well" he said.
Kerry reported volume growth across each of the regions where it operates. The best growth of 9.3pc came from the Asia, Pacific, the Middle East and Africa area, led by China.
The company said consumer demand for "food for life and well-being", "new taste experiences" and "made for me" products continued to be "noteworthy" drivers of innovation.
"Kerry's industry-leading taste and nutrition technology portfolio and unique business model continue to drive significant value for our customers as they seek to meet these rapidly evolving consumer demands and increase speed to markets," Mr Scanlon said.
At the end of March, net debt was €1.9bn, up from €1.6bn at the end of December, which the company said reflected acquisitions completed in the period.
Shares in Kerry closed up more than 1.2pc yesterday to €101 each, to value the business at €17.8bn.
Earlier this year the company said that it would look at potential job cuts in its UK operations over the coming months as part of a review of its manufacturing divisions.
In February Mr Scanlon said that the company would be "optimising" its manufacturing footprint in the UK.
But he declined to say whether or not it would involve job losses.