Kerry Group PLC on Wednesday improved its annual financial guidance after what it considered a good first half despite lower revenue and profit, with both volume growth and better profit margins in its key Taste & Nutrition division.

Kerry is based in Tralee, County Kerry in Ireland. It provides nutrition products for the food, beverage and pharmaceutical markets.

Pretax profit fell by 10% to €340.5 million in the six months that ended June 30 from €379.2 million a year before, as revenue slipped 5.9% to €3.88 billion from €4.12 billion. Kerry said the revenue decline was caused by price deflation, currency movements, and the effect of net business disposals.

Despite the lower revenue, earning before interest, tax, depreciation and amortisation was up 6.6% to €552.2 million from €518.0 million. However, Kerry took a €24.3 million non-trading item cost, compared to a €40.5 million such gain a year before.

Kerry said volume was up 3.1% in its Taste & Nutrition division for the half-year. It was up 3.2% in the second quarter alone, suggesting acceleration. Ebitda margin in the division improved by 130 basis points, while across the entire group the margin was up 160 points.

‘Taste & Nutrition volume growth was led by strong performances in the foodservice channel across all three regions, as we continue to support established foodservice chains evolve and develop their businesses, while working with emerging leaders to upscale their operations and offerings,’ said Chief Executive Officer Edmond Scanlon.

‘Volume growth in the retail channel was driven by good performances in the Americas and APMEA, led by very strong growth in Snack applications.’

Adjusted earnings per share was 194.1 euro cents in the half year, up 7.8% from 180.0 cents a year before. Adjusted EPS was up 9.1% at constant currency, and Kerry raised its guidance on this measure for the full year to 7% to 10% growth from 5.5% to 8.5% previously.

Kerry declared an interim dividend of 38.1 cents, up 10% from 34.6 cents a year before. Kerry also repurchased €279 million in shares during the recent six months as part of its share buyback programme.

Kerry shares were up 5.1% to €86.20 in London on Wednesday afternoon.

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