Barry Callebaut experiences drop in sales volumes amid challenging markets

Barry Callebaut has released its latest nine-month performance figures that have reported a 2.7% drop in sales volume to 1,704,240 tonnes, amid weakening premium chocolate demand and rising production costs, reports Neill Barston.

However, sales revenues for the period stood at CHF 6.3 billion, up 3.6%, though chocolate production declined by 3.7%, with the company noting that there had still been residual impact from last summer’s salmonella-related plant shutdown at its core site in Wieze, Belgium.

The company said its latest results were broadly in-line with wider market performance for the chocolate market, which was down 1.5% as an overall category for this year.

It noted there had been some encouraging performance figures of a 1.9% increase in emerging market territories, though its gourmet and specialities activities were down 6.3% in what it described as a ‘challenging market environment.’

This comes despite the company’s major launch last summer of its Second Generation Chocolate, which was hailed as having ‘game-changing potential’ for the business in further enhancing its overall portfolio in a sustainable manner. It gained its initial launch in Venice Italy, before recently being shown at Sweets & Snacks Expo in Chicago (see our exclusive video report here, featuring Laura Bergan, pictured main image).

This summer, the business extended its Forever Chocolate mission targets, setting renewed goals for 2030 in terms of ensuring traceability of its supplies, and further support to cocoa farming communities in West Africa, and elsewhere around the world.

Peter Feld, CEO of the Barry Callebaut Group, who recently took over from outgoing CEO Peter Boone, acknowledged that this year had posed notable challenges.

He said: “In the first nine months of the fiscal year, we witnessed soft volume in a continued inflationary environment which affected customer demand. Our volume was in line with the declining underlying chocolate confectionery market, excluding the residual effects of the Wieze incident. The recently announced renewal of a global strategic partnership with a key customer underpins the sustained trend toward outsourcing. It is a showcase for the added value we can deliver to customers globally and for the deep relationships our teams are building every day.

“In a challenging market environment, we continue to work towards flat volume growth for the Full Year 2022/23 and remain confident to deliver solid operating profit. We will provide a full strategic update with the Full-Year results publication on November 1, 2023.”

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