De Longhi’s share sale calls peak coffee
14/09/2021 10:43
(The author is a Reuters Breakingviews columnist. The opinions
expressed are their own.)
MILAN, Sept 14 (Reuters Breakingviews) - De Longhi
Industrial’s DLG.MI owners may be calling the top of the
coffee machine boom. The 5 billion euro company’s founders’
vehicle, which owns a 56.5% stake, and Chairman Giuseppe
De’Longhi, between them sold https://www.delonghigroup.com/sites/default/files/ENG_DLI_launch%20press%20release%2020210913%20clean.pdf
4% of its shares through an accelerated book building on
Tuesday. At 35.38 euros a share, the sale is about 9% below
Monday’s close and more than 10% below an all-time peak of
around 40 euros reached in June.
De Longhi has had a good pandemic. A jump in hot brews
consumption during lockdowns lifted sales https://www.delonghigroup.com/sites/default/files/ANNUAL%20REPORT%20AT%2031%20DECEMBER%202020%20-%20OFFICIAL.pdf
for its coffee division, which represents about 50% of sales.
Personal kitchen appliances brands Kenwood and Ariete also did
well as people spent more time cooking at home. That’s why De
Longhi’s shares doubled in value in the pandemic and revenue is
expected to grow 32% this year. Kitchen goods are however not
frequent buys. And as people return to the office, there won’t
be much time for domestic coffee-drinking: sales may grow just
4% a year through 2023, Refinitiv data show. It’s a good time to
take a break. (By Lisa Jucca)
On Twitter http://twitter.com/breakingviews
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(Editing by Neil Unmack and Karen Kwok)
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