Kerry Group ended 2021 on a strong note, confirming its recovery from the Covid-enforced setback in results announced on Wednesday. Revenues for the year were 5.7 per cent higher off the back of stronger volumes, although 2020 was impacted by Covid-19 restrictions.
The group said revenue of €7.4 billion reflected volume growth of 8 per cent, with volumes in its taste and nutrition division up 8.3 per cent and consumer foods volumes rising 6 per cent.
"In the taste and nutrition retail channel, we continued to deliver strong growth, while we achieved excellent growth in foodservice with business volumes in all regions above 2019 levels in the fourth quarter," said Edmond Scanlon, Kerry Group chief executive.
“This growth was well spread across our end use markets, with beverage, bakery and meat delivering particularly strong performances.”
Group trading profit increased by 9.8 per cent to €875.5 million with earnings before interest, tax, depreciation and amortisation (ebitda) of €1.1 billion. Adjusted earnings per share (EPS) were 380.3 cent. Basic EPS were 430.6 cent, up from 313 cent a year earlier.
A final dividend per share of 66.7 cent amounts to a 10.1 per cent increase, bringing the total 2021 dividend to 95.2 cent.
“We ended the year on a strong note with excellent growth across our business,” Mr Scanlon said. “The year was important for Kerry from a strategic perspective. We continued to enhance our position as a market-leading taste and nutrition company with a number of strategic portfolio developments, while further enhancing our local footprint to support our growth ambitions.”
Richard Flood, investment manager at Brewin Dolphin Ireland, said the results were very positive.
“Kerry is operating in a very attractive industry where there is an increasing requirement for the application of food science in global food production,” he said. “This, together with Kerry’s strategy of enhancing its capabilities by making bolt-on acquisitions, plays into its strengths and leaves the company well placed for the future.”
The group has issued guidance for its 2022 adjusted earnings per share of 5 per cent to 9 per cent growth on a constant currency basis
“While recognising that current market environment and inflationary pressures continue to present challenges across our industry, Kerry is stronger positioned and more resilient than ever as we enter a new strategic cycle,” Mr Scanlon said. “Our earnings guidance range for 2022 reflects the group’s strong growth prospects and the net effect of recent portfolio developments.”
In a note to clients, stockbrokers Davy said the company’s outlook inferred that it expects to recover raw material inflation in full in the prices it secures, “which endorses model robustness and relevancy”.
Goodbody analyst Jason Molins said increased M&A activity would see Kerry becoming even more focused on the higher growth and higher margin taste and nutrition business.
