Aryzta targeting underlying growth

Management at Aryzta has pledged to focus on recovering the food group’s underlying growth potential, on the back of a disappointing set of annual results where recent acquisitions provided the only real high point.

The Irish-Swiss baked food group yesterday reported a 12.6% jump in revenue, for the 12 months to the end of July, to €3.82bn.

Currency movements increased revenue by nearly 8% while acquisition contributions added another 7.1%.

Underlying revenue, however, declined by 2.2%. Total underlying net profit was down by 4.7% to €360m, with underlying fully-diluted earnings per share falling by the same percentage to 402.2c.

“Our focus is now on delivering the underlying revenue growth potential of the business, which is expected to generate a ten-fold expansion in free cash generation in fiscal year 2016 to €200m+ and building further, thereafter,” said Aryzta’s chief executive, Owen Killian, who described the 2015 financial year as “a disappointing year for shareholders, as underlying revenue growth failed to materialise, resulting in negative operating leverage”.

He added, however, that the group remains well-invested and strategically positioned to grow its relevance to customers, through innovation and customisation

The group, which owns the likes of Tim Hortons and Cuisine de France, has now completed its move to a speciality food company, via the total divestment of its remaining stake in Irish agri-services group, Origin Enterprises last week.

Management is targeting underlying earnings per share of between 365c and 385c for its current financial year.


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