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Barry Callebaut CEO says staying in Russia feels right

By Silke Koltrowitz

ZURICH (Reuters) – Swiss chocolate maker Barry Callebaut will maintain working in Russia to assist its prospects and staff there, regardless that photos from the conflict in Ukraine create “monumental strain,” it stated on Wednesday.

The Zurich-based group posted greater earnings and gross sales volumes for the primary half of its fiscal 12 months, helped by a restoration within the world chocolate market. However Russia’s invasion of Ukraine has compelled all shopper items firms with a presence within the area to rethink their methods.

Whereas its buyer Nestle has stopped promoting most meals, together with KitKat chocolate bars, in Russia, Barry Callebaut’s three Russian factories and 500 workers are nonetheless working.

“We’re beneath monumental strain simply watching the photographs we get from the conflict and we can not not look into the boardroom of different firms,” Chief Government Peter Boone informed reporters.

“We’re involved with our 500 colleagues in Russia, they clearly haven’t requested for this choice by the Russian authorities. For us, it appears like the proper factor to do to remain shut for our staff and our prospects,” he stated, including the corporate’s chocolate and cocoa went into every kind of merchandise together with drinks and breakfast cereals.

He stated the enterprise in Russia – the fourth-largest chocolate confectionery market, in accordance with Euromonitor – represented lower than 5% of group volumes and the corporate was taking a 5 million Swiss franc ($5.4 million) impairment to replicate the elevated danger of buyer default there. It has additionally stopped new capital funding within the nation.

Boone stated it was tough to get uncooked supplies to Russia, however nonetheless attainable as meals just isn’t lined by Western sanctions.

The corporate confirmed its objectives for 5-7% gross sales quantity development and earnings earlier than curiosity and tax above quantity development for the three years to August 2023.

Robust chocolate gross sales and a restoration in its connoisseur enterprise with eating places helped gross sales volumes rise 8.7% within the six months to the top of February. Web revenue climbed 3.1%.

Its shares have been down 2% in early buying and selling.

($1 = 0.9333 Swiss francs)

(Reporting by Silke Koltrowitz; Modifying by Paul Carrel and Mark Potter)



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