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Kerry Group 'A' Shares (KYGA)

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Up  104.60
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Kerry targets 10% earnings growth per annum

29 Jun 11

LONDON (ShareCast) - Shares in Kerry Group edged higher on Wednesday after the company announced new growth targets, including an average 10% growth in adjusted earnings per share per annum over the next five years.

Stan McCarthy, the chief executive of the firm, which owns the sausage brands Richmond and Walls, said that its new targets will be achieved by “above industry-average volume growth, business margin progression and the net benefits accruing from the Group's business transformation and efficiency programmes.”

Kerry expects to achieve like-for-like (LFL) volume growth of 3% to 5% per annum, with the ingredients and flavours businesses targeting 4% to 6% LFL growth (10% in emerging markets). The consumer foods business is targeting 2% to 3% LFL growth.

Ingredients and flavours are expecting to increase margins by 50 basis points (bp) per annum and consumer foods is targeting a 20bp improvement per annum. This will equate to an annual 30bp increase in group margin over the next half decade.

Kerry predicts that the completion of the group’s ‘Kerryconnect’ business enablement programme will contribute a further 100bp improvement to group margins over the five year.

“Our capital spend will increase to support the Group's planned growth over the five-year cycle and expenditure on the Kerryconnect programme will be approximately €350m. Notwithstanding this increased investment in Group systems and infrastructure, our financial return target ratios remain above 15% for return on average equity (ROAE) and above 12% for cash flow return on investment (CFROI)," McCarthy added.


Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.


Market Data

Currency Euro
Price  104.60
Change Today  1.60
52 Week High  109.60
52 Week Low  85.60
Volume 75,516
Shares Issued 176.49m
Market Cap  18,461m


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