Lindt & Sprüngli continues to increase sales and profit

The company therefore succeeded once again in meeting its strategic growth and sales targets. In addition to the 10.2% increase in net income amounting to CHF 419.8 m, both the EBIT margin and the return on sales improved. The Group balance sheet remains very solid. The good result achieved over the past business year 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.

The “Europe” segment achieved overall organic sales growth of 7.4% in local currencies. All European countries reported pleasing results. The two subsidiaries in Germany and the UK accelerated their pace of growth and attained double-digit sales growth. The smaller subsidiaries, Scandinavia, Czech Republic, Poland and Russia achieved double-digit growth as well.

The American chocolate market as a whole declined in 2016 for the first time in years, despite a more stable general economic situation. The organic sales growth increased by 3.4% in the “NAFTA” region. The adjustments to Russell Stover’s product portfolio and promotions strategy also had a negative impact on sales during the financial year, while at the same time laying the long-term foundation for profitable growth in the future. With its three leading brands – Lindt, Ghirardelli and Russell Stover – Lindt & Sprüngli is clearly positioned as No.1 in America’s premium chocolate segment. Cooperation between the US subsidiaries Lindt, Ghirardelli and Russell Stover was enhanced in 2016. The establishment of a new subsidiary, Lindt & Sprüngli (North America) Inc., helps to support the three US subsidiaries in centralized tasks such as merchandising, logistics and IT, while at the same time creating synergy effects. Business performance in the segment “All other markets” was very dynamic. Total sales in this category rose by 10.2%.

“Global Retail” once again reported strong double-digit sales growth in the 2016 financial year. The strategic target of 30 new openings every year was comfortably beaten again. With more than 60 new shops in total, the network has already grown to around 370 retail outlets. 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.