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Aryzta revenue up 13.2%, but underlying revenue down 2.3% in its Q3

Aryzta revenue up 13.2%, but underlying revenue down 2.3% in its Q3

BERN: Swiss bakery business Aryzta AG (ARZTY.PK,ARZTF.PK), in its third quarter trading update for the period ended 30 April 2015, said that total revenue grew by 13.2% in the quarter to 973.2 million euros. But, underlying revenue declined 2.3% in the period. Acquisitions provided 3.1% growth and currency movements provided growth in the quarter of 12.4%.

Europe revenue grew by 4.7% in the third quarter to 405.9 million euros. Underlying revenue growth was 1.8%. Revenues declined by 0.6% from the impact of acquisitions and net disposals, while currency added 3.5%.

North America revenue grew by 21.5% in the quarter to 509.4 million euros. Underlying revenue declined 6.7%, a 170 bps improvement over the Q2 (8.4)%. Acquisitions provided 6.9% growth, while currency movements positively impacted by 21.3% in the quarter. The decline in underlying revenue in North America reflects the impact of the SKU rationalisation strategy to improve capacity utilisation and reduce investment CapEx allocation. This trend is expected to continue through Q4 with the consequential impact for margins from negative operating leverage.

Rest of World revenues increased by 9.0% in the quarter to 57.9 million euros, with an underlying growth contribution of 3.4% and a favourable currency impact of 5.6%.