ARYZTA announced resilient H1 results with strong margin expansion despite a significant negative volume impact from active portfolio management. Its EBITDA increased by 7% to EUR 149.8m, corresponding to an EBITDA margin of 14.2%, up 100bps from the comparable period. ARYZTA’s profit margin is well on track to reach its mid-term target of at least 14.5%. Its H2 organic growth is expected to improve.
This reflects the benefit of margin-enhancing innovations, active portfolio management and disciplined cost management, the bakery says. The innovation pipeline remained strong, accounting for 19.4% of revenue, almost double compared to the prior period. Premium products accounted for c. 40% of its revenue. In addition, ARYZTA continued to grow its customer base.
The overall H1 organic growth was negative (0.7)%. This was achieved against very strong performance in the comparable period (+22% in H1 2023). The active portfolio management negatively impacted volume by c. 2.5%. In addition, a more challenging consumer environment and continuing cost inflation also affected its growth, while QSR recovery is still ongoing.
ARYZTA AG Chairman and interim CEO Urs Jordi commented: “ARYZTA delivered another strong performance with improved profitability, solid cash generation and debt reduction. We have now achieved five of our six 2025 mid-term targets well ahead of schedule and are on track to deliver the remaining margin improvement target of at least 14.5%. The performance was achieved on flat volume growth impacted by active portfolio management, which favored profitability over volume.
Our strong cash generation coupled with our new €930m RCF re-financing, allows us to repurchase the larger of the two remaining CHF hybrid bonds in full, delivering further significant improvements in our financial position to support continued growth.
Our innovation pipeline remains strong and supportive of improved growth expectations in H2, despite consumer spending remaining under pressure due to persistent cost of living increases.
We reiterate our 2024 full-year guidance for low to mid-single-digit organic growth and improved financial performance across all metrics.”
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