JDE Peet’s reports half-year results 2021
Good progress and broad-based performance, delivered in
a quality way
PRESS RELEASE Amsterdam, 4 August 2021
Key items1
- Total organic sales grew 4.2%, supported by In-Home momentum
(+4.9%) and fuelled by Single Serve and Beans growing double-digit.
E-commerce grew by 30% In-Home
- Away-from-Home returned to profitability, despite largely
stable sales base on average for H1 (+0.7%) although with visible
positive reopening effects in Q2
- Organic adjusted EBIT grew 0.8% to EUR 636 million, with gross
profit margin expansion
- Free cash flow of EUR 553 million and net debt reduced to EUR
4,660 million
- Leverage reduced to 2.98x, from 3.23x at the end of FY 20
- Underlying EPS grew 12.9%, mainly supported by operational
improvements
- Positive market share performance across technologies and
continued progress on Sustainability
- Confident to reach FY 21 outlook
A message from Fabien Simon, CEO of JDE
Peet’s
“I would like to thank all our teams around the world for their
perseverance while successfully navigating our company through all
the ongoing challenges and complexity and for delivering this
strong set of results.
We are pleased with our first-half 2021 results, across all key
metrics, including top-line, profitability, cash generation and
in-market performance. Guided by our refreshed strategy, we
delivered 4.2% organic sales growth, in a quality way, with a gross
profit margin expansion of 26 basis points that enabled JDE Peet's
to reinvest behind its powerful portfolio of brands and future
growth opportunities.
In the first half of the year, we also continued to evolve our
business portfolio. We announced partnerships with J.M. Smucker in
the US and with Pret A Manger in the UK, the acquisition of Campos
in Australia and the divestment of two small businesses in the
Netherlands and France.
We also significantly optimised our financial position and
capital structure, reducing our leverage to below 3x, and our
average cost of debt to around 1.5%, from our successful
refinancing and inaugural bond issue.
Looking at our Sustainability agenda, I am very pleased that in
June, our European manufacturing footprint reached Zero Landfill
status.
Based on the progress made in the first half of 2021 and our
current expectations for the remainder of the year, we remain
confident to reach our outlook for the year, being intentional on
managing inflation and navigating the enduring uncertainty of the
pandemic."
Sustainability
We continued to make good progress on our Sustainability agenda
in the first half of 2021. In March, when we refinanced our bank
facilities, we connected EUR 2.5 bn of our investment grade
facilities to our sustainability ambitions. That same month, we
also committed to adopt a Science-Based Target and we are on track
to announce a science-based greenhouse gas reduction target through
SBTi in the second half of this year. In manufacturing, our
facility in Gavle, Sweden, was the first one to achieve the PAS2060
certification for carbon neutrality in March, and in June, all our
manufacturing facilities in Europe reached the Zero Landfill status
for the first time.
Outlook 2021
Although vaccination programmes around the world continue to
support the gradual lifting of lockdown measures, the COVID
situation remains highly volatile and uncertain as, unfortunately,
spikes in infection rates in a number of countries continue to lead
to new lockdowns. This continues to limit the visibility and
predictability regarding the timing and the pace of the recovery in
our Away-from-Home businesses.
Within this context, we continue to expect organic sales growth
of 3 to 5% in FY 21, assuming a gradual recovery in Away-from-Home.
We also continue to expect organic adjusted EBIT to grow in the low
single-digit range in FY 21, as we step up our investments for
growth, notably in marketing and innovation support.
Our commitment to reduce our leverage to below 3x net debt to
EBITDA was achieved by the end of June.
FINANCIAL REVIEW HALF-YEAR 2021
in EUR m (unless otherwise stated)
|
6M 2021 |
6M 2020 |
Organic change |
Reported change |
Sales |
3,254 |
3,236 |
4.2 % |
0.5 % |
Adjusted EBIT |
636 |
642 |
0.8 % |
-1.0 % |
Underlying profit for the period |
446 |
393 |
- |
13.5 |
% |
Underlying EPS (EUR) 1, 2 |
0.89 |
0.79 |
- |
12.9 |
% |
Reported basic EPS (EUR) |
0.76 |
0.44 |
- |
72.7 |
% |
1 Underlying earnings (per
share) exclude all adjusting items (net of tax) |
|
|
2 Based on 501,446,549
shares outstanding (H1 20: 498,719,501) on 30 June |
|
|
In H1 21, total sales increased by 4.2% on an organic basis. Our
In-Home businesses continued to deliver strong organic sales growth
of 4.9% while sales in Away-from-Home remained relatively stable
(+0.7%) as the positive effects of re-openings in a limited number
of countries in the course of H1 21 was largely offset by new
lockdowns in a number of other markets.
Total organic sales growth reflects a volume/mix effect of 3.7%
and 0.4% in price. Changes in scope and other changes decreased
sales by 0.2% while foreign exchange had a negative impact of 3.5%.
Total reported sales increased by 0.5% to EUR 3,254 million.
Adjusted EBIT increased organically by 0.8% to EUR 636 million
driven by increased gross profit which was partially re-invested in
marketing, innovations and growth capabilities. Adjusted SG&A
increased organically by EUR 61 million. Including the effects of
foreign exchange and scope changes, adjusted EBIT decreased by
1.0%.
Underlying profit - excluding all adjusting items net of tax -
increased by 13.5% to EUR 446 million supported by lower interest
expenses as a result of deleveraging and lower average cost of
debt, as well as a reduction of other finance expenses.
Net leverage improved to 2.98x net debt to adjusted EBITDA from
3.23x at the end of FY 20.
In the first half of 2021, both Moody's and Standard &
Poor's assigned investment grade ratings with a stable outlook to
JDE Peet's, underscoring our operating strength, strong financial
discipline, and continued progress on deleveraging.
Our liquidity position remains strong, with total liquidity of
EUR 2 billion consisting of a cash position of EUR 0.5 billion and
available committed RCF facilities of EUR 1.5 billion. For the
full and original version of the press release click here
CONFERENCE CALL & AUDIO WEBCAST
Fabien Simon (CEO) and Scott Gray (CFO) will host a conference
call for analysts and institutional investors at 10:00 AM CET today
to discuss the half-year 2021 results. A live and on-demand audio
webcast of the conference call will be available via JDE Peet’s’
Investor Relations website.1 This press release contains certain
non-IFRS financial measures and ratios, which are not recognised
measures of financial performance or liquidity under IFRS. For a
reconciliation of these non-IFRS financial measures to the most
directly comparable IFRS financial measures, see page 6 of the
press release.
ENQUIRIES
Media Michael Orr Media@JDEPeets.com +31 20 558
1600
Investors & Analysts Robin Jansen
IR@JDEPeets.com +31 6 159 44 569
About JDE Peet’sJDE Peet’s is the world's
leading pure-play coffee and tea company by revenue and served
approximately 4,500 cups of coffee or tea every second in 2020. JDE
Peet's unleashes the possibilities of coffee and tea in more than
100 developed and emerging markets through a portfolio of over 50
brands that collectively cover the entire category landscape led by
household names such as L’OR, Peet’s, Jacobs, Senseo, Tassimo,
Douwe Egberts, OldTown, Super, Pickwick and Moccona. In 2020, JDE
Peet’s generated total sales of EUR 6.7 billion and employed a
global workforce of more than 19,000 employees. Read more about our
journey towards a coffee and tea for every cup at
www.JDEPeets.com.
IMPORTANT INFORMATION
Market Abuse Regulation
This press release contains information within the meaning of
Article 7(1) of the EU Market Abuse Regulation.
Presentation
The condensed consolidated unaudited financial
statements of JDE Peet’s N.V. (the "Company") and its consolidated
subsidiaries (the "Group") are prepared in accordance with
International Financial Reporting Standards as adopted by the
European Union ("IFRS"). In preparing the financial
information in these materials, except as otherwise described, the
same accounting principles are applied as in the consolidated
special purpose financial statements of the Group as of, and for,
the year ended 31 December 2020 and the related notes thereto. All
figures in these materials are unaudited. In preparing the
financial information included in these materials, most numerical
figures are presented in millions of euro. Certain figures in these
materials, including financial data, have been rounded. In tables,
negative amounts are shown in parentheses. Otherwise, negative
amounts are shown by "-" or "negative" before the amount.
Forward-looking Statements
These materials contain forward-looking statements
as defined in the United States Private Securities Litigation
Reform Act of 1995 concerning the financial condition, results of
operations and businesses of the Group. These forward-looking
statements and other statements contained in these materials
regarding matters that are not historical facts and involve
predictions. No assurance can be given that such future results
will be achieved. Actual events or results may differ materially as
a result of risks and uncertainties facing the Group. Such risks
and uncertainties could cause actual results to vary materially
from the future results indicated, expressed or implied in such
forward-looking statements. There are a number of factors that
could affect the Group’s future operations and could cause those
results to differ materially from those expressed in the
forward-looking statements including (without limitation): (a)
competitive pressures and changes in consumer trends and
preferences as well as consumer perceptions of its brands; (b)
fluctuations in the cost of green coffee, including premium Arabica
coffee beans, tea or other commodities, and its ability to secure
an adequate supply of quality or sustainable coffee and tea; (c)
global and regional economic and financial conditions, as well as
political and business conditions or other developments; (d)
interruption in the Group's manufacturing and distribution
facilities; (e) its ability to successfully innovate, develop and
launch new products and product extensions and on effectively
marketing its existing products; (f) actual or alleged
non-compliance with applicable laws or regulations and any legal
claims or government investigations in respect of the Group's
businesses; (g) difficulties associated with successfully
completing acquisitions and integrating acquired businesses; (h)
the loss of senior management and other key personnel; and (i)
changes in applicable environmental laws or regulations. The
forward-looking statements contained in these materials speak only
as of the date of these materials. The Group is not under any
obligation to (and expressly disclaim any such obligation to)
revise or update any forward-looking statements to reflect events
or circumstances after the date of these materials or to reflect
the occurrence of unanticipated events. The Group cannot give any
assurance that forward-looking statements will prove correct and
investors are cautioned not to place undue reliance on any
forward-looking statements. Further details of potential risks and
uncertainties affecting the Group are described in the Company’s
public filings with the Netherlands Authority for the Financial
Markets (Stichting Autoriteit Financiële Markten) and other
disclosures.
Market and Industry Data
All references to industry forecasts, industry
statistics, market data and market share in these materials
comprise estimates compiled by analysts, competitors, industry
professionals and organisations, of publicly available information
or of the Group's own assessment of its markets and sales. Rankings
are based on revenue, unless otherwise stated.
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