Monday 21 October 2019

Aryzta eyes US boost as CEO Toland gets €4.1m pay package

Aryzta CEO Kevin Toland
Aryzta CEO Kevin Toland
John Mulligan

John Mulligan

Cuisine de France owner Aryzta is "realistic about and resolved to address clear revenue challenges" at its business in North America, according to CEO Kevin Toland.

Releasing full-year results yesterday, the Swiss-Irish company said that its underlying earnings before interest, tax, depreciation and amortisation (ebitda) stabilised in the period. It follows a tumultuous few years that saw Aryzta shore up its finances last October with a €740m lifeline from shareholders, as it continued a major turnaround plan.

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Aryzta's annual report, also published yesterday, shows that Mr Toland was paid a total of 4.53m Swiss francs (€4.1m) in the 12 months to the end of July. That included a basic salary of €881,000, as well as awards of €2.2m under a long-term incentive plan.

He was awarded more than 1.2m performance share units in the financial year, as well as 1.93m share options.

His remuneration included an €863,000 "performance and contractual-related bonus and retention" payment.

Mr Toland is the former head of Glanbia's US and global nutritionals unit, and ex-DAA chief executive.

He was parachuted into Aryzta two years ago as its performance continued to deteriorate. He conceded that Aryzta will continue to struggle in the near term in North America - its single biggest revenue market - but insisted that it will improve in the current financial year.

"We will see a further period of negative organic growth in [the first half] in the North American market, with positive evolution expected in [the second half] as new contract volumes are realised," he said.

He added that Aryzta expects to see better underlying ebitda performance in North America in the current financial year. Underlying ebitda at a group level is also expected to be higher, as the company benefits from Aryzta's Project Renew plan, according to Mr Toland.

Last week, Aryzta said it had reached an agreement to sell most of its 49pc stake in French frozen food supplier Picard for €156m to Tunisian conglomerate Invest Group Zouari. Aryzta acquired the stake in 2015 for €446m.

The firm aims to raise €450m from the sale of non-core assets, with the proceeds earmarked for debt reduction.

Shares in the company, which operates 53 bakeries in 29 countries, were 5pc lower in Switzerland yesterday morning, despite Aryzta reporting flat group organic revenue for the financial year.

Total revenue, at €3.38bn, was 1.5pc lower, however. Underlying ebitda was up 1.9pc at €308m. It made an operating profit of €5.1m compared with a €423.3m operating loss previously.

"While the financial performance in the 2019 financial year is not yet where we want or expect it to be, we have delivered overall organic revenue stability and improving performance against a series of measures," said Aryzta chairman Gary McGann.

Irish Independent

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