Aryzta has achieved strong organic growth in the first quarter of 2022, its latest financial results show.
The Cuisine de France-owner's revenue increased to €424.9 million, 'driven by strong volume growth,' during the period.
Aryzta said that it achieved 9.8% organic growth in the first quarter for 'continuing operations comprising of 8% volume growth and a 1.8% price/mix improvement.'
"We achieved strong organic momentum in Q1 as recovery continued across all our markets," commented Urs Jordi, AG Chair and Interim CEO, Aryzta.
The Swiss-Irish food group said that customer engagement has increased around innovation, product mix changes and service levels.
Price/Mix Growth
Europe achieved a broad based double-digit organic growth of 10.1% comprising of 8.6% volume growth and 1.5% price/mix growth.
Rest of World achieved 7.9% organic growth comprising of 4.3% volume growth and 3.6% price/mix growth.
"The combination of strong volume recovery and positive price/mix in the period reflects the benefits of our new lean multi local business model," said Jordi.
Aryzta noted that volume growth in Europe outperformed Rest of World due to a continued strong recovery while Rest of World was affected by Covid-related lockdowns in New Zealand and Australia.
The divestment of the Brazilian operation and the Swiss sandwich business impacted total revenue growth of continuing operations by 1.2%, while currency movement contributed 0.3%.
Aryzta said that the first quarter performance reflects the benefits of the new simplified organisation and the empowerment of local management to engage with customers.
Looking Ahead
According to Aryzta, a re-invigorated innovation programme in all markets helped deepen customer engagement, leading to an improved margin profile due to beneficial mix changes.
The company said that continuing high inflation requires a combination of pricing and acceleration of operational efficiencies to protect the business performance.
“We are continuously working on cost mitigation measures to further improve our lean and efficient structure. In conjunction with pricing, we are improving our mix of higher margin product through innovation," Jordi added.
"We are confident in delivering our financial year guidance of mid-single digit organic revenue growth comprising of positive volume and price contributions and our Q4 run rate target of 12.5% EBITDA margin pre-IFRS16.”
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