By Paolo Laudani and Emanuele Berro
(Reuters) -Barry Callebaut said on Wednesday that it expected a mid single-digit percentage decline in sales of cocoa products in its upcoming financial year, as it continues to face pressure from high cocoa prices.
The company, which supplies chocolate for Unilever’s soon-to-be-spun-off Magnum ice creams and Nestle’s KitKat bars, also forecast recurring core earnings (EBIT) growth in a low to mid single-digit percentage, measured in local currencies, for the 2025/26 financial year.
The company, whose ingredients are present in one out of four chocolate and cocoa products consumed worldwide, said its sales volume fell 6.8% to 2.1 million tonnes in the financial year that ended in August.
Analysts were expecting 2.1 million tonnes on average, a company-provided poll showed.
Volumes fell 8% in the fourth quarter between June and August, according to a Reuters calculation.
NEW GUIDANCE, OLD PROBLEMS
Analysts had contrasting reactions to the new forecast the Zurich-based company provided.
Vontobel’s Matteo Lindauer said the the new guidance was a “welcome shift” from last year’s unattainable targets. However, Kepler Cheuvreux’s Jon Cox called the targets cautious and said the stock may come under pressure as a result.
Barry Callebaut’s shares were seen falling 3% in premarket indications as of 0713 GMT.
“Industry conditions stay challenging, as underscored by recent commentary from key customers such as Mondelez and Hershey,” Lindauer said.
In October, Mondelez cut its annual profit forecast, citing weakening spending among value-conscious consumers in North America and Europe, while higher cost of cocoa added pressure.
(Reporting by Paolo Laudani and Emanuele Berro in Gdansk, editing by Matt Scuffham and Milla Nissi-Prussak)
