Barry Callebaut outgrows a global chocolate market rocked by price hikes

Barry Callebaut has outgrown a declining global chocolate confectionery market hurt by a bout of wholesale price increases in its nine-month results.

The company today released its nine-month key sales figures (September 2014 – May 2015) and posted 2.5% growth in sales volumes to 1.32m metric tons (MT).

Over the same period, volumes in the global chocolate confectionery market dropped 2.1%, according to Nielsen.

Affected by recent price increases

Barry Callebaut CEO Juergen Steinemann said the global market was “currently affected by recent price increases for consumer products and rather soft economies across the globe”.

Major chocolate firms including Nestlé, Mondelēz, Hershey and Mars Chocolate North America raised wholesale prices in the past year in response to increasing input costs, particularly for cocoa.

Rising cocoa bean prices prop up revenues

In its nine-month results, Barry Callebaut’s sales revenues grew 7.6% to CHF 7.6m ($8m), supported by higher cocoa bean prices and strong growth in its gourmet & specialties division.

Cocoa bean prices climbed 4% during the nine-month period to £2,100 ($3,226) on May 29, Barry Callebaut said in its release. The supplier passes on raw material prices to customers for most of its business.

For the nine-months, Barry Callebaut posted volume and revenue growth in Region Europe, but reported a tough political and economic environment in Russia. It also registered volume growth in the Americas and Asia Pacific despite declining volumes in the overall chocolate confectionery market.

Looking ahead, CEO Juergen Steinemann, said: “As communicated, we expect sales volume to gain more momentum in the fourth quarter of the fiscal year. We will keep on navigating carefully through the challenging cocoa market.“

The company maintained its current full year guidance of 6-8% average volume growth and EBIT per MT restored to CHF 256 ($271) per MT by 2015/16.