ZURICH, July 25 (Reuters) - Lindt & Spruengli upped its full-year sales outlook to 7-9% on Tuesday after price increases helped the Swiss chocolate maker post organic growth above its 6-8% target range for the first six months of 2023.
The maker of Lindor chocolate balls said its organic sales, which cut out the impact of acquisitions and currency swings, increased 10.1% to 2.09 billion Swiss francs ($2.4 billion).
Zuercher Kantonalbank had forecast revenue of 2.08 billion Swiss francs.
Net profit increased to 204.5 million Swiss francs from 138.4 million francs a year earlier, said the company based in Kilchberg, near Zurich.
Lindt was able to overcome a more difficult consumer environment with price increases during the period. Pricing was the main driver for the increase, Lindt said, making up 9.3% of the extra sales.
Volumes of chocolate bars and other products such as golden chocolate bunnies in contrast only increased by 0.8%.
"Due to inflationary effects and the resulting subdued consumer sentiment, volumes stagnated or declined slightly depending on the product group and market," Lindt said in a statement.
Chocolate makers have been increasing their prices to compensate for the higher input costs.
"But the flip side is that volumes in the food industry are currently falling as shoppers are hit by inflation and some are buying less branded products when they go food shopping," said Zuercher Kantonalbank analyst Patrik Schwendimann.
"Lindt is more towards the luxury end of chocolate, so has been able to pass on these price increases."
Barry Callebaut, a Swiss chocolate making peer of Lindt, earlier this month reported a drop in sales volumes due to lower demand.
Alongside its raised organic growth outlook, Lindt said it also expects to raise its profit margin by 30 to 50 basis points this year.
For the coming years, "the Group continues to reiterate its medium- to long-term sales growth targets of 6–8% with an improvement in the operating profit margin of 20–40 basis points per annum," Lindt said.
($1 = 0.8693 Swiss francs)
Reporting by Noele Illien; Editing by John Revill and Stephen Coates
Source: Reuters