Barry Callebaut with substantial sales growth and marked increase in net income

Thanks to concentration on profitable growth and focussing on three consistently market-oriented business units, Barry Callebaut was able to achieve very positive results for the first half of the current business year. Sales rose during the first six months of fiscal 2000/2001 by 18% to CHF 1,460.9 million. Operating income climbed by 19% to CHF 104.1 million and net income by 8% to CHF 67 million. This development is the result of both sales growth and an improvement in margins. Barry Callebaut is looking forward to good results for the whole of fiscal 2000/2001.

During the first six months of the current fiscal year (September 2000 to February 2001), Barry Callebaut boosted consolidated sales by 18.8% to CHF 1,460.9 million. Adjusted for the effect of rising cocoa prices, this represents growth of 13.8%. Of this, 4.2% is accounted for by organic growth, with Barry Callebaut again growing twice as fast from its own resources as the market as a whole. Growth from acquisitions amounted to 9.6%.

In comparison with the same period in the previous year, operating income (EBIT) rose markedly by 19.1% to CHF 104.1 million. Net income improved by 8.2% to CHF 67.0 million (year-back figure: CHF 61.9 million). Growth in net income was lower than that for EBIT as a result of the higher cost of financing acquisitions made in the course of the year and the higher tax expenditure that had already been announced last autumn.

The most important business unit, Chocolate, registered an above-average increase in sales of 16% to CHF 763.6 million (52.3% of total sales). Here, it proved possible to increase both margins and earnings successfully.

The Gourmet & Specialties unit also recorded very good results. Sales climbed – primarily as the result of acquisitions – by 57% to CHF 396.2 million (27.1% of total sales). The increase in earnings here was disproportionately high in comparison with volume growth.

Unlike the other two business units, Cocoa registered lower real net output, with sales shrinking by 5% to CHF 301.1 million (20.6% of total sales). This business unit concentrates on marketing branded powder and supplying companies internally throughout the Group.

In the past six months, Barry Callebaut sold a total of 425,325 tonnes of cocoa products and specialty chocolate, which represents an increase of 13.8%. This once again reinforced the Group’s leading position worldwide as a producer of top-quality products based on cocoa, chocolate and related products.

Outlook for entire fiscal year
Barry Callebaut expects the growth rates already achieved in respect of EBIT and net income to continue at a comparable level for the second half of the year.

Ivory Coast
On 28 March 2001, the Ministry of Economy and Finance of the Republic of the Ivory Coast sent SACO, a local subsidiary of Barry Callebaut, a supplementary tax claim for some CHF 250 million in respect of the years 1998 to 2000. An initial examination has shown that the claim is unenforceable. SACO intends to formally contest the claim with all means available and to contact the government in the matter. SACO’s annual sales amount to some CHF 160 million. Until now, the correctness of accounting procedures has been regularly confirmed by the tax authorities responsible.

Barry Callebaut in brief:
With market share of 39% and annual sales in excess of CHF 2.5 billion, Barry Callebaut is the world’s leading manufacturer of top-quality products based on cocoa, chocolate and related products. The company processes 14% of total global cocoa bean production. Barry Callebaut supplies professional processors of cocoa and chocolate products for the manufacture of chocolate, confectionery, biscuits, diary products, ice-cream and breakfast cereals. To complement its comprehensive range of top-quality products, Barry Callebaut also offers its customers services in the realms of development, processing, training and marketing.
Barry Callebaut operates 24 production facilities in 15 countries and employs more than 5,000 people. The company is structured in three strategic business units Cocoa, Chocolate and Gourmet & Specialties. The Barry Callebaut AG holding company has been listed on the SWX Swiss Exchange since June 1998 (ticker symbol BARN).