IAWS gets good growth from Panera Bread
It started to contribute to the profits of the Irish group in the fourth quarter of the last financial year.
For the four weeks ended June 14, like for like says and the company’s own and franchised stores grew by 9.9% year on year.
In the year to date the sales growth is 7.7% according to food analyst, John O’Reilly of Davy Stockbrokers.
Panera bakes in store from centrally prepared chilled dough. The company has an aggressive store-opening programme.
Of particular note, said O’Reilly is the wholegrain aspect of what the US subsidiary does.
Sales in wholegrain and artisan style bread categories are continuing to grow in the US.
In a new guide on diet the US food and Drug Administration recommended a higher intake of wholegrain breads, which has helped boost output at Panera.
Through La Brea IAWS is also heavily involved in the artisan bread market which has wide distribution across the US at this stage.
Their status will be enhanced by the FDA’s recommendation.
In Dublin yesterday the shares were off just 5 cents to €11.64.
They hit a high this year of €12.70 and a low of €11 back in March the group announced a 23% hike in first half profits to January 31 despite tough trading conditions for its provender business.
Pre-tax profits, before exceptional items and goodwill amortisation, were up to €42.8 million from €34.8 million during the same period in 2004.
Operating profits, before goodwill amortisation, were up 20.4% to €48.6 million.
Turnover, including shares in joint ventures, was up about 9 per cent from €599 million to €653 million.
Commenting, IAWS group chief executive Owen Killian said the company was benefiting from its geographic diversification strategy. However, he admitted there was “some margin erosion” in its food business, and difficult trading conditions in its agrinutrition business.
He said the group continued to generate substantial free cash and was well-placed to continue its expansion. The company said its food business managed to increase sales by 14% in the period, but the agri business suffered a 5% decrease in sales.
