Lindt & Spruengli aims for 6-8% sales growth, announces share buyback (updated)

Chocoladefabriken Lindt & Spruengli AG

02/03/2021 06:38

(Adds detail, background.)
    By Silke Koltrowitz
    ZURICH, March 2 (Reuters) - Swiss chocolate maker Lindt &
Spruengli  LISN.S   LISP.S  said on Tuesday it aimed for 6-8%
organic sales growth this year thanks to pent-up demand after
the pandemic hit its business and made net profit slide last
year.
    Chocolate makers are grappling with subdued demand as
consumers buy fewer chocolates as gifts or while traveling
during the COVID-19 pandemic, and Lindt has also been hit by the
temporary closure of its own stores.
    Net profit fell 37.5% to 320.1 million Swiss francs 
($349.53 million) in 2020, the maker of Lindor chocolate balls
and gold foil-wrapped Easter bunnies said in a statement.
    But the company said it was convinced that the chocolate
market, and in particular the premium segment it operates in,
would continue to grow in the future.
    It said it expected organic sales to grow 6-8% this year and
then, from 2022 onwards, 5-7% per year in line with its medium
term guidance.
    The Zurich-based company also announced a new share buyback
programme of 750 million francs from June this year to the end
of next year and will pay out a dividend of 1,100 francs per
registered share and of 110 francs per participation
certificate.
    It had paid out an exceptionally high dividend for its
anniversary last year.
    "Overall, a solid print with cash flow and the announcement
of a buyback the main positive surprises," Kepler Cheuvreux
analyst Jon Cox said, adding the outlook was also upbeat, but
more or less in line with street expectations.
    Lindt & Spruengli had already flagged a 6.1% drop in 2020
organic sales in January. The contraction in sales led its
operating profit margin to fall to 10.5%, from 13.2% in 2019.
 urn:newsml:reuters.com:*:nL8N2JU0N6
    It said the margin should return to 13-14% this year and
then to 15% in 2022.

($1 = 0.9158 Swiss francs)

 (Reporting by Silke Koltrowitz
Editing by Riham Alkousaa and Brenna Hughes Neghaiwi)
 ((silke.koltrowitz@thomsonreuters.com; +41 41 528 3638;))