Lindt's Profits Bittersweet as Outlook Is Cloudy
By: Premium Swiss chocolate maker Lindt & Spruengli on Thursday warned that commodity markets remain volatile and that consumer sentiment is hit by the prospects of a worsening employment market.
Despite the uncertain outlook for 2012, the Zurich-based maker of golden Easter bunnies stuck to its long-term organic growth target of 6-8 percent annually.
Analysts at Bank Vontobel applaud the confirmed guidance and add that Lindt & Spruengli’s results are “remarkable given the challenging environment”.
Net profit rose 1.9 percent to 246.5 million Swiss francs ($273 million), just ahead of forecasts while group sales slipped 3.5 percent to 2.49 billion Swiss francs, as the strong franc shaved off 9.5 percent from the top line. Lindt & Spruengli said it will increase its dividend by 11 percent to 500 Swiss francs a share.
The chocolate maker said that all its subsidiaries outgrew the flat to slightly declining market, except for Australia.
In another sign that chocolate producers are feeling the pinch from the Swiss franc and the uncertain economic environment, Switzerland’s chocolate trade group Chocosuisse said earlier in February that chocolate revenues for 2011 have melted by 3 percent to 1.7 billion francs.
However, volumes remained relatively stable at 176,000 tons compared to 2010 of which 60 percent are exported.
Despite the worries about jobs and the strength of the Swiss franc, the Swiss still have a sweet tooth: they consumed 12 kilos of chocolate per person in 2011, with the majority of it being Swiss chocolate.
