Swiss bakery group Aryzta has reported a 0.9% increase in underlying quarterly sales from its food division amid "very challenging" economic conditions in Europe.
The 0.9% rise was the underlying revenue growth from Arytza's "food group" - the bulk of its business that excludes its majority stake in Irish agribusiness Origin Enterprises - for the three months to the end of October, the first quarter of its financial year.
In Europe, underlying sales fell 0.2%. Aryzta said the result was a "sequential improvement" compared to the previous three quarters. However, it said "macro consumer dynamics" in Europe were "weak".
In North America, underlying revenue increased 1.3% on the back of "steady volumes". Aryzta was not able to increase prices during the quarter.
Kepler Capital Markets analyst Jon Cox said the result from Europe was "better than we anticipated", although the figures from North America were "slightly worse".
However, he added: "We have always assumed FY 2013 will be a year of transition as it focuses on expanding its margin in North America as it rolls up various acquisitions in the region over the last couple of years. We believe the company represents the best risk-reward profile in the European mid-cap space."
On a reported basis, Aryzta's first-quarter sales increased 9% to CHF1.1bn (US$1.19bn).
Aryzta kept its forecast for underlying earnings per share to increase by 5-10%.
Shares in Aryzta were down 0.96% at CHF46.40 at 11:08 CET.
Show the press release
Zurich/Switzerland, 3 December 2012 – ARYZTA AG announces its first quarter trading update for the period ended 31 October 2012:
Commenting on the Q1 Trading Update, ARYZTA AG Chief Executive Officer
Owen Killian said: "Our performance during the period was satisfactory, given that the global trading environment remains very challenging and has not improved since our year-end results announcement in September.
"As previously highlighted, FY 2013 will be another year of substantial transformation and reorganisation for ARYZTA. Based on the Q1 performance, we continue to view the outlook and guidance issued with our 2012 full-year results as valid."
