Last Updated on May 22, 2020 by kristina
The COVID-19 pandemic will negatively impact the global Gourmet & Specialties business of Barry Callebaut AG by an unknown level, said Antoine Bernard de Saint-Affrique, chief executive officer. He gave details on how the market was affected in China.
Because of uncertainty in the financial markets, Barry Callebaut, as a prudent decision, drew the whole amount of its revolving credit facility, a total of €1 billion ($1.08 billion) for six months.
Barry Callebaut reported sales revenue of 3,762 million Swiss francs ($3,877 million) in the six months ended February 29, which was up 2.4% from 3,673 million Swiss francs in the first half of the previous fiscal year. Sales volume rose by 5.4%. Besides for China in February, COVID-19 did not affect first-half results, Mr. Bernard de Saint-Affrique stated.
He also noted several positives. The primary cocoa season in Africa is over, and COVID-19 for the moment has had less of a negative effect on volume in Barry Callebaut’s Food Manufacturing and Global Cocoa businesses.
He also said that the company expected Gourmet & Specialties volume to be tremendously impacted as countries went into lockdown have shut down all restaurants, the coffee zones, and most of the out-of-home activity. He also added that the impact could not be quantified at this stage as it depended on the length and severity of the pandemic. However, it is expected to have a better understanding of the overall impact of COVID-19 by the time of its nine-month sales publication in July.
The first-half sales volumes by business were 688,602 tonnes for Food Manufacturing, 130,515 tonnes for Gourmet & Specialties, and 227,578 tonnes for Cocoa. COVID-19’s effect on the Gourmet & Specialties business in China increased on February 13 when the country went into lockdown.
Mr. Bernard de Saint-Affrique stated that they noticed a sharp slowdown of their Gourmet business immediately, and their factory, like the vast majority of Chinese factories, couldn’t restart production until February 20. After the reopening, the company took about three weeks to get back to average factory utilization. Now, they see a buoyant market recovery in both FM (Food Manufacturing) and Gourmet. Online sales have accelerated in China as well, he said.
Mr. Bernard de Saint-Affrique said that nobody could predict if and when the example of China can be applied elsewhere. Still, indeed, the company will be well-prepared to serve its customers as soon as the situation improves as this day will come.
Barry Callebaut continues to manufacture products for its customers. Mr. Bernard de Saint-Affrique called it a tribute to Barry Callebaut employees. The company believes that there is no better testimony for their excellent work than the fact that they still operate. Barry Callebaut has not experienced significant disruption and keep serving its customers every day. Barry Callebaut’s cocoa and chocolate products can be found everywhere: in breakfast products, in energy bars, in our cookies, all products are foods essential. The company contributes every day to keep the food chain going, and this gives them all the energy in the world.