Aryzta beset by revenue difficulties

1cb2b67e-d1da-4194-a0ad-806772ac8701articleimage.jpg

01 Dec 2017 --- Swiss-Irish food group Aryzta has experienced a 5.5 percent fall in revenue to €909.7m in the three months to 31 October. According to the group’s revenue update, Group organic revenue declined by 2.6 percent in the period. Currency had a 2.9 percent negative impact on revenue.

Earlier this year, former Aryzta CEO Owen Killian stepped down following a series of financial issues at the food group, while the company announced a record decline in shares with earnings set to decrease 20 percent this year.

This was the latest in a long line of problems at the firm which says it has been struggling with the impact of Brexit, as well as taking a financial hit after introducing its Otis Spunkmeyer snacks to the US market. 

A significant component of the reduced revenue can be explained by revenue losses at the Cloverhill facility and mitigating initiatives taking longer than anticipated to be realized, according to Aryzta.

Cloverhill Bakery is a producer of baked goods primarily sold through vending machines throughout North America. It also produces the buns used by McDonald's. Cloverhill was acquired by Aryzta in 2014.

According to the latest revenue update, despite the expected reduction from Swiss in-sourcing, Aryzta Europe had organic growth of 0.6 percent, offset by negative currency headwinds of 0.9 percent. Meanwhile, Aryzta North America organic revenue declined by 7.0 percent in the period, driven entirely by Cloverhill, says the company. 

Aryzta Rest of World had strong organic growth of 7.8 percent, offset by a negative currency impact of 5.3 percent. And, excluding the impact of the Cloverhill business in North America, Group organic revenue increased by 1.3 percent.

“The business challenges are unchanged from those outlined in September, said CEO Kevin Toland. “Europe continues to perform to expectation, including Germany, with broadly based growth across the region offsetting planned Swiss in-sourcing. Progress at Cloverhill in North America is proving difficult. Management’s priority is to continue to identify issues and opportunities to address operating performance and to maximize available free cash flow.”

To contact our editorial team please email us at editorial@cnsmedia.com

Related Articles

Food Ingredients News

Flavor trends 2018: Innova Market Insights tips overseas influences, plant goodness & indulgence as key drivers

17 Jul 2018 --- Today’s connected world creates an opportunity for new ethnic flavors, street food inspired meals and the revival of culinary classics. Innova Market Insights has reported an average annual growth of 20 percent in food and beverage launches with global flavors (Global, 2013-2017), with growth in platforms such as chili, herb and floral flavors. With the plant-based trend still going strong, consumers are looking for innovative ways to take the benefits of plants into their daily lives. Meanwhile, innovation relying on decadent flavor application, from desserts to alcohol or flavors that evoke indulgence, will continue to grow and remain paramount in the industry.

Food Ingredients News

Nuts, grains & pulses: Plant-based eating trends boost alternative proteins

17 Jul 2018 --- Consumers’ quest for alternative protein is driving innovation across several categories involving nuts, seeds, grains and pulses, backed-up by a rise in vegan and vegetarian trends and an overall growth in meat-free food. People want products with alternative sources of protein as they turn away from traditional meat sources and one of the categories where plant-based inspired eating is driving innovation in snacking. Plant proteins fit some of today’s most significant trends in food and beverage product development – non-GMO, organic, sustainable, vegan, big 8-free, allergen-free and label-friendly. They’re also versatile and functional and that combination of attributes is why we see plant proteins in everything from beverages to bakery products.

Food Ingredients News

Barry Callebaut hails volume growth “significantly above global chocolate confectionery market”

16 Jul 2018 --- Barry Callebaut has released its nine-month key sales figures for the fiscal year 2017/18 which has shown good group momentum and volume growth that is significantly above the global chocolate confectionery market, according to the company. In the first nine months of fiscal year 2017/18 (ended May 31, 2018), the manufacturer of high-quality chocolate and cocoa products grew its sales volume by 6.9 percent to 1,512,853 tons.

Food Ingredients News

Kaslink & Tetra Pak partnership: Transforming Nordic oats into plant-based dairy alternatives

16 Jul 2018 --- With plant-based dairy drinks trending strongly in Europe, Kaslink and its partner, Tetra Pak are “willing to take risks to stay ahead of the competition.” In the Nordic countries, oat is a common food ingredient. Oat-based drinks and fermented oat-based products are cereal-based products which are common in Asia where many products are based on soy, almond or rice. The global market for alternative dairy drinks is expected to reach US$16.3 billion this year alone, according to Innova Market Insights data, a dramatic increase from US$7.4 billion in 2010.

Food Ingredients News

Arla Foods expands premium yogurt offerings to European markets

13 Jul 2018 --- Arla Foods is set to expand its Finnish brand, Ihana, into new markets. The premium yogurt range was launched in Denmark this spring and makes its debut in the UK this week. Made with natural ingredients, Ihana taps into key trends that fit with European consumer lifestyles and provides an authentic and indulgent treat with a thick and creamy texture.

More Articles