For the first time, Australian kitchen appliance brand Breville surpassed AUD $1 billion (US $714m) in sales. Contrary to many other businesses, Breville greatly benefited from the drastic change in lifestyle and work-from-home environment that resulted in people purchasing coffee makers to brew their own morning cup of coffee. This significant profit growth is also due to the company’s expansion into the new international markets.
It was the fourth year in a row that the company achieved double-digit growth, with 2021’s annual sales increasing 24.7% to $1.19 billion. Earnings before interest and taxes increased 39.6% to AUD $136.4 (US $97m) million and the net profit increased 42.3% to AUD $91 (US 65m) million. Jim Clayton, Breville Group CEO, stated:
A fairly remarkable year for the Group with accelerated demand experienced in the first half carrying through to the second half. Increased consumer demand, driven by the need/requirement to work from home, coupled with our continued geographic expansion, outweighed logistical challenges and a weakening US dollar.
One reason for the sales growth in 2021 is the change in people’s lifestyles, where most people work from home. Customers want to make their own coffee at home, which results in high demand for coffee makers.
Furthermore, the company also acquired U.S. coffee machine manufacturer Baratza in September 2020. Breville’s retail sales increased 8% to AUD $203.5 m (USD $145m), leading to a 10.6% increase in earnings to AUD $25.3m (USD $18m). In contrast, the growth of Kambrook brands and Nespresso are lower than that of Breville, demonstrating the company has outperformed its peers.
The company also expanded into France, Portugal, Italy and Mexico, and this expansion — along with a shift to premium products and reduced promotional spend — also contributed to Breville’s high-profit growth in 2021.
As the world moves towards vaccine rollouts and reopening of economies, Clayton mentioned 2022 being a “transition year” with consumer behaviour shifting from goods to services.
