Coffee giant JDE Peet’s has reported a slightly larger-than-expected 5.9% fall in full-year profit but expects a return to growth during 2023.
The group’s EBIT slipped from €1.30bn to €1.23bn over the 12 months to 31 December 2022 as rising product development and marketing costs outweighed higher prices.
Organic sales climbed 11.3% to €8.15bn after a 15.8% increase in average prices offset a 4.4% decline in volumes. In-Home sales rose by 8.9%, while Away-from-Home sales climbed 22.3% as the sector recovered from the effects of the pandemic.
JDE Peet’s noted that while volume elasticity remained below the historical average, volumes were negatively impacted by retaliations during customer negotiations across various European markets, including Germany, France and the UK.
The company projected “low single-digit” growth in adjusted EBIT for 2023, with organic sales growth at the high end of its medium-term range of 3% to 5%.
“In 2022, we delivered double-digit sales growth, increased our absolute gross profit, delivered strong free cash flow and higher EPS, while increasing investments to support our long-term growth ambition in areas such as marketing, innovation, digital commerce, emerging market capabilities and sustainability,” said Chief Executive Fabien Simon.
“Consequently, we are emerging stronger for 2023, with an elevated growth portfolio, a competitive market share position, a well-invested business and a more productive and very engaged enterprise.”
