Consumers have fickle tastes. Kerry (KYGA) knows this, and so it’s spending 4.6 per cent of its sales on building infrastructure and improving its capabilities, so it can respond more quickly to customer demands. This represents a 130 basis point increase on the previous year, and this spending will increase to nearer 5 per cent over the next two years.
So far it looks as though this this investment is paying off. Kerry attributed its 4.3 per cent volume growth to technological capabilities and speed of innovation in response to consumer and customer requirements, so it makes sense that they’d prioritise spending on these areas. But this volume growth, and an average price increase of 2 per cent, was offset by unfavourable movements in foreign exchange – as the euro strengthened the margin remained flat at 12.2 per cent.
Analysts at Liberum expect EPS of 355ȼ in the year to December 2018, up from 336ȼ in FY2017.
| KERRY GROUP (KYGA) | ||||
| ORD PRICE: | 8,160ȼ | MARKET VALUE: | €14.4bn | |
| TOUCH: | 8,140-8,160ȼ | 12-MONTH HIGH: | 9,492ȼ | LOW: 6,904ȼ |
| DIVIDEND YIELD: | 0.8% | PE RATIO: | 24 | |
| NET ASSET VALUE: | 2,028ȼ* | NET DEBT: | 38% | |
| Year to 31 Oct | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (ȼ) | Dividend per share (ȼ) |
| 2013 | 5.84 | 122 | 48 | 40.0 |
| 2014 | 5.76 | 556 | 273 | 45.0 |
| 2015 | 6.10 | 603 | 299 | 50.0 |
| 2016 | 6.13 | 612 | 303 | 56.0 |
| 2017 | 6.41 | 613 | 334 | 62.7 |
| % change | +5 | +0.2 | +10 | +12 |
| Ex-div: | 19 Apr | |||
| Payment: | 18 May | |||
| *Includes intangible assets of €3.6bn, or 2,070ȼ a share | ||||
