Input costs rise, but Kerry unveils sales growth
Revenue at Kerry Group, the Irish food group, rose 8.4% in the first half of 2011 and the producer has revealed it is confident of achieving growth targets for the year, despite rising costs.
Sales revenue at the manufacturer of Walls and Richmond sausages increased to €2.6bn for the six month period, with trading profit up 6.1% on a like-for-like basis to €214m. Profit before tax rose to €175m from €162m a year earlier.
However, in line with other food manufacturers the company said that its raw material costs rose by 11% during the first half of the year. Group trading margin was down 30bps.
In an interim management statement, Stan McCarthy, chief executive, said: “Kerry delivered a solid earnings performance and strong volume growth in the first half of 2011, despite significant raw material and input cost inflation.”
“The group remains confident of achieving its growth targets for the full year and delivering 8 to 12 per cent growth in adjusted earnings per share as guided at the beginning of the year.”
In a statement, the company added: “Encouraging growth was maintained in developing markets. While the Irish and UK consumer food markets remain higly competitive with heavy promotional activity which delayed input cost recovery, Kerry’s leading brand maintained good growth in the UK market and stabilised market shares in Ireland.”