Lindt continues his "sweet" growth despite stagnating chocolate markets

High-end Swiss chocolatier and confectionery company Lindt & Sprüngli grew at a faster pace than the overall chocolate market last year, according to the company’s latest financial results. 

Although the group is at the top end of the market, which would give it some margin for manoeuvre on prices, the race to cut costs within the industry still took its toll.

Net profits climbed 10.2% to 419.8 million Swiss francs. There was an overall organic sales growth of 7.4% in Europe with the two subsidiaries in Germany and the UK accelerating their pace of growth, while smaller subsidiaries in Scandinavia, Czech Republic, Poland and Russian achieved double-digit growth.

The result "is particularly gratifying given the backdrop of a persistently challenging environment of stagnating and even declining chocolate markets, generally subdued consumer sentiment caused by political and economic uncertainty, high raw material prices and increasing price pressure from trading partners".

In North America, growth was just 3.4%, as the "chocolate market as a whole declined in 2016 for the first time in years despite a more stable general economic situation", it said.

It said the results in Japan and Brazil were particularly impressive, with high double-digit sales growth mainly due to the opening of the company's own shops and cafés.

Lindt & Sprüngli confirms its mid- to long-term goal of organic sales growth of 6–8% combined with an increase in the operating profit margin of 20–40 basis points. For the 2017 financial year, the Group expects sales growth to be broadly in line with the previous year, and a further improvement in the operating margin.