Kerry Group expects revenue to drop by €1bn following sale of dairy division

Chief executive of Kerry Group Edmond Scanlon said: 'Volume growth was led by strong performance in the Americas through foodservice innovations and increased nutritional renovation across a broad range of customers.'

Revenue at Kerry Group is expected to see a €1bn reduction following the company’s decision to divest from its dairy processing division and sell it to Kerry Co-op, its preliminary results for 2024 show.

Last year, Kerry Group announced that it would shift towards becoming a purely taste and nutrition company following its sale of Kerry Dairy Ireland. In November, agreement was reached to sell the business for a total expected consideration of €500 million, with phase one of the transaction for a 70% shareholding completing on December 31, 2024.

According to the company’s preliminary results, it generated a revenue of just under €8bn during 2024 — a slight decrease compared to 2023. Of that, just over €1bn comes from “discontinued operations” which includes Kerry Dairy Ireland.

This resulted in revenue from continuing operations for the year of €6.9bn. Earnings before various deductions increased by 7.4% to €1.25bn — up from nearly €1.165bn in 2023. Net debt at the end of the year was €1.9bn.

Volume for the year grew by 3.4% which was led by its snacks, beverage and bakery divisions. Pricing fell by 2.1% reflecting easing input cost deflation in the year.

Chief executive of Kerry Group Edmond Scanlon said their continued volume progression in their “Taste & Nutrition” division as well as their “strong margin expansion across the business” contributed to their “strong performance” across the year.

“Volume growth was led by strong performance in the Americas through foodservice innovations and increased nutritional renovation across a broad range of customers,” he said.

Kerry said 2024 saw the company pivot towards becoming a “pure-play global business to business taste and nutrition company”.

In its outlook for the year, Kerry Group said it is “well positioned for strong market outperformance” given its “unique positioning with customers as an innovation and renovation partner”.

“Kerry will continue to evolve strategically and develop its taste and nutrition portfolio in areas where it can create the most value.” 

Mr Scanlon added that Kerry Group expects to deliver volume growth and strong margin expansion this year “resulting in constant currency adjusted earnings per share growth of 7% to 11%, after the dilution from the Kerry Dairy Ireland disposal”.