Lindt & Sprüngli Group wins new market shares

With an above market average increase of sales and earnings, Chcoladefabriken Lindt & Sprüngli AG, Kilchberg, has announced a successful financial year 2013 in every respect in what continues to be a challenging market environment, and won additional market shares. The good annual financial statement once again highlights the reliability of the Group’s long-term strategic goals. The Group’s above average growth is based mainly on higher volumes in key markets and on progressive geographical expansion; here, the Global Retail division is an increasingly important sales factor with its own sales network. All the subsidiary companies contributed to the good results.

Lindt & Sprüngli achieved Group sales of CHF 2.883 bn; in local currency terms, this is equivalent to organic growth of 8.6%, well above the market average. As a consequence of the good sales performance which was supported by all the subsidiaries and is based mainly on higher volumes, additional market shares were gained in all the key markets and also in the new emerging regions where LINDT is continuing to pursue its geographical expansion. A large number of innovative new launches and increased marketing activities further accelerated the sales dynamics in the year-round business and also in the seasonal range.

The share of Group sales accounted for by the Global Retail Division with some 200 own outlets, boutiques and LINDT Chocolate Cafés is growing steadily and reached around 9 percent in 2013. Own distribution concepts are vitally important, especially in gaining access to new markets with no strong chocolate tradition, in order to establish the premium brand values of LINDT and enhance familiarity with the brand.

The previous year's comparatives of the balance sheet and the income statement have been restated accordingly. The operating profit (EBIT) was 22.4 percent higher at CHF 404.1 m (2012: CHF 330.1 m). The EBIT margin improved to 14.0 percent in the year 2013. With a return on sales of 10.5 percent, the net profit stood at CHF 303.0 m (2012: CHF 244.9 m), in other words 23.7 percent above the previous year’s figure. The operating cash flow rose to CHF 419.1 m (2012: CHF 381.2 m).

The rapid growth in Europe and North America and the access to new markets call for clear strategic objectives and a structured action plan which also makes includes the expansion and optimization of production performance. Investments made in 2013 accordingly stood at CHF 191.4 million (previous year: CHF 144.6 million) and concentrated mainly on the constant extension of production capacities and quality optimization through new technologies and processes. The balance sheet and capital structure are extremely sound. The equity ratio and net liquidity stood at 67.9 percent (2012: 64.2%) at the end of 2013 and CHF 723 m (2012: CHF 543 m).

The new share buyback program initiated in fall 2013 for a maximum of 5 percent of the registered share and participation capital will be completed by the end of 2014. As of December 31, 2013, no registered shares and 1,682 participation certificates had been bought back. The total volume of these purchases stood at CHF 6.5 m

The Group Management is assuming that the economic situation will continue to recover somewhat, if only slowly, in the year 2014. However, high raw material prices and the volatile trend of the exchange rates of important foreign currencies will continue to present major challenges. What is more, sustained competition in the retail trade is placing ever-increasing pressure on prices to which the weaker brands in particular are increasingly exposed. Thanks to continuous investments in the brand and in the markets, Lindt & Sprüngli is perfectly equipped to master these challenges and to attain its long-term strategic goals again in the financial year 2014. www.lindt.com