FDBusiness.com

Despite the challenging economic environment, Swiss chocolate confectionery group Lindt & Sprungli has reported a strong performance during the first half of 2011 with sales and profits significantly above the market average. Indeed, the company has now confirmed its full year targets, announced in March 2011, of organic sales growth in local currencies of 6-8% and an increase in operating profit margin of 20-40 basis points.

Lindt & Sprüngli achieved sales of SFr1.01b (Eur887m) for the first half. This represents significant organic growth in local currencies of 6.1% compared with the same, very strong period in the previous year. However, this figure decreased by 4.7% after conversion into Swiss francs.

Organic growth was mainly achieved by increases in volume and improvements to the product mix, as well as selective price increases in some markets. The launch of new products also contributed.

Operating profit (EBIT) for the first half of 2011 increased by 23.9% to SFr33.9m compared with the same period for 2010. Net income at SFr32.1m rose by 29.4%.

With six production sites in Europe, two in the US and distribution and sales companies on four continents, Lindt & Sprungli sells its products in more than 100 countries around the world. Particularly good progress was made in the group’s important main European markets of Germany, France, and Italy, as well as by the Lindt and Ghirardelli brands in North America. Lindt & Sprungli also recorded solid growth in Switzerland. Only the UK subsidiary failed to meet expectations, given the especially difficult economic climate.

Lindt & Sprungli will continue to focus on increasing its shares in key markets and geographical expansion into growth regions during the second half of the year. The company also intends to adhere to its proven ‘premium’ pricing strategy and to maintain a high level of advertising activity throughout the second half, despite the volatility in terms of raw materials and currencies.