Irish food ingredient and dairy company Kerry continues to move forward with the group reporting on Tuesday a 22 per cent leap in 2002 profits after tax to €189 million thanks to a strong perfomance across all businesses.
Group turnover increased by 25 per cent to €3.8 billion and total sales grew by 25 per cent last year to €3.8 billion, reflecting a solid performance in the Americas as well as Ireland. Like-for-like sales growth came in at 6.0 per cent.
"The strong performance of the group in 2002 is most encouraging and was achieved across all businesses and territories. Based on our core strengths and global service capabilities, we view the prospects of the group with confidence," said Hugh Friel, managing director of the Kerry group.
In Europe Kerry Ingredients recorded a strong performance, despite lower economic growth in the main consumer markets. The Aromont and Voyager businesses acquired in 2001 performed well, broadening Kerry's offering to the dynamic prepared meals sector. The food coatings sector proved difficult in the first half of 2002, but Kerry achieved solid growth overall in the sector and progress in the snack sector was in line with market growth levels. The division's expanded ingredients range also contributed to further gains in the quick-serve-restaurant sector.
The company reports that Eastern European markets again exhibited good growth. Kerry commissioned a new factory in Budapest to enhance its ingredients manufacturing capability and service in the region.
The company's sweet and fruit ingredients business across Europe benefited from stronger consumer demand for convenient, indulgent products in the dairy, bakery, cereal, confectionery and snack sectors.
Considerable resources were applied in advancing the group's global flavour business development strategy in 2002. 'Mastertaste', the group's new flavour division was launched in June, to spearhead development across Kerry's European, American and Asia-Pacific flavour businesses. Building on its 2001 and 2002 acquisitions, Mastertaste has streamlined the constituent flavour businesses and focused technical development across sweet, savoury and cheese and dairy flavour capabilities for the food and beverage industries.
Kerry claims that R & D investment in Mastertaste in 2002 was focused on the development of natural flavours for both savoury and sweet applications and to extension of the division's line of functional flavours. Mastertaste Italy (SGF), which has a strong heritage in botanical and herbal extracts, was developed originally for the Italian beverage sector, and according to Kerry, made good progress through development of a wide range of natural extracts.
Further development in European markets in 2002 included the acquisition of ingredients business UK company EBI Foods, a provider of food coatings and blended ingredients to food manufacturers, supplying the foodservice sector across European, Middle Eastern and Far Eastern markets.
In the USA, development across Kerry's seasonings, foodservice, coatings, sweet ingredients, speciality ingredients and 'Nutriant' nutritional ingredients businesses was again in line with expectations. Seasonings saw new product activity in the second half of 2002, with good progress in both salty snack and meat seasonings markets. In the speciality ingredients sectors, Kerry grew in line with overall industry demand through dairy, cheese and speciality lipid ingredients.
Business development through 'wet systems' targeted at the fast growing ready-to-use sauce category proved successful with both foodservice product manufacturers and retail branded sectors. The company reports that margins in the food coatings sector were weaker due to higher wheat flour and energy costs.
Kerry also announced a final dividend per share up 16.3 per cent at 7.85 euro cents.