ZURICH, SWITZERLAND — Aryzta North America posted revenue of €366.9 million ($413.7 million) in the first quarter ended Oct. 31, which was down 10% from the previous year’s first quarter. Organic revenue was down 2.8%, while disposals had a negative effect of 8.7%. Volume was down 2.1% in Aryzta North America while price/mix was down 0.7%.

Excluding Cloverhill, which Aryzta acquired in 2014, organic growth was 1% in Aryzta North America in the first quarter of fiscal 2019.

“While we’re making progress under the new management team led by Dave Johnson, the North American business continues to face ongoing challenges,” Kevin E. Toland, chief executive officer, said during a Nov. 26 conference call with analysts. “Over the course of the last 12 months, we have flattened the management structure, reorganized the business to reduce head office headcount by 25%, completed, in July, a $7.4 million annual cost saving reorganization of the wider U.S. management team, and, last February, sold off the lossmaking Cloverhill business.

“The new team is working hard at realigning the business to better service our core B2B customers. However, it will take time and further effort to fully stabilize the business; and, from there on, start to improve performance. As previously outlined, we expect cost inflation to remain an ongoing issue in North America, with key labor and logistics cost lines not yet being fully recovered by pricing initiatives.”

Zurich-based Aryzta Group companywide had first-quarter revenue of €862.3 million ($972.6 million), which was down 5.2% from the previous year’s first quarter. Aryzta Europe had revenue of €430.4 million, down 1.1%, and Aryzta Rest of the World had revenue of €65 million, which was basically flat from a year ago.

“Overall, we are encouraged to see stability in organic revenues in the first quarter,” Mr. Toland said. “Post the successful capital raise, we remain resolutely focused on our core, the frozen B2B bakery market, and that the management team are resolved to implement our multi-year turnaround strategy. As mentioned earlier, a stronger capital base and available liquidity will allow us to transition from a position of perceived commercial stress to a position of stability. Increasing financial flexibility, liquidity, and the implementation of Project Renew will enhance performance and, over time, deliver growth.

“Revenue for the first quarter is in line with our expectations. For fiscal 2019, Aryzta expects underlying performance to be stable, and the early benefits from Project Renew to flow into the P.&L. The company expects mid- to high-single-digit organic EBITDA growth for fiscal year 2019, applying budget fiscal 2019 exchange rates on a like-for-like basis, and excluding any disposals.”