Kerry food ingredient sales rise 12% in first half

by Jeff Gelski
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TRALEE, IRELAND — The Kerry Group P.L.C. reported food ingredients sales of €1,453 million ($1,786 million) for the fiscal first half ended June 30, a 12% increase from €1,297 million in the previous year’s first half.

The food ingredients success lifted the Kerry Group to a reported profit after taxation and attributable to equity shareholders of €101 million, a 14% increase from €86 million in the previous year’s first half.

Group sales revenue grew to €2,117 million, an 8% increase over last year’s first half. The continued depreciation of the U.S. dollar and exchange rates versus the euro again impacted performance. On a like-for-like basis, total sales grew by 3.4%.

"In a highly competitive trading environment, exacerbated by energy and raw material cost increases and adverse currency movements, the group performed well in the first half of 2005," said Hugh Friel, chief executive of Kerry Group. "We expect further business improvements in the second half, with an outcome for the full year in line with market expectations."

Kerry expects an interim dividend of 5c per share, which compares with 4.5c per share last year. The interim dividend will be paid Nov. 25 to shareholders registered on Oct. 21.

In food ingredients, like-for-like sales growth was 3.8% in the first half. Trading profits increased by 10% to €118 million, reflecting a trading margin of 8.2%.

American ingredient markets sales revenue grew 6.5% to €573 million, reflecting a growth of 2.6% on a like-for-like basis.

Development in many U.S. food and beverage categories recovered in the first half as the 2004 low-carbohydrate phenomenon declined. Product demand for functional ingredients had returned to prior year levels by the end of the first half. Demand for soy-based systems and nutritional lines improved to encouraging levels.

Kerry continued to make progress in the premium ice-cream and ready-to-eat cereal sectors. Added value meat processors and regional snack processors provided a platform for growth.

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