Chocolate maker Barry Callebaut sees profit slightly below forecast on pricey cocoa (updated)

Nestle SA

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Updates share move in paragraph 6, adds CEO comments on ice cream demand in paragraphs 8-9.
Sees recurring operating profit growth of 3% to 5% in fiscal 2026/27
Raises cocoa bean price assumption to £4,000/ton from around £3,000/ton
Hershey partnership deal to expire at end of 2027
By Paolo Laudani and Isabela Kruczynska
Nov 4 (Reuters) - Barry Callebaut BARN.S reported a second straight quarter of volume growth on Wednesday, but forecast a slightly weaker-than-expected profit for the upcoming financial year after raising its cocoa price assumptions.
A major chocolate supplier for food producers such as KitKat maker Nestle NESN.S, Barry Callebaut expects its recurring operating earnings to grow between 3% and 5% in constant currencies during the 2026/27 financial year.
That compares with an expected 5.5% increase in a company-provided consensus.
Barry Callebaut is projecting a cocoa bean price of £4,000 ($5,381) per metric ton, up from around £3,000 it had assumed in July. Cocoa beans currently trade at £4,192 per ton.
Even as cocoa prices have come off their peak, they are still elevated on concerns that the El Niño weather phenomenon will harm the crop in West Africa.
The chocolatier's shares were up around 4% by 1046 GMT in volatile trading, after falling as much as 1.6%.
     
VOLUMES RISE AGAIN IN JUNE-AUGUST QUARTER
Barry Callebaut reported 5.7% volume growth in its fiscal fourth quarter, helped by growth in most regions, following third-quarter growth that had bucked a long-lasting negative trend.
Its ice cream business, which supplies the likes of Magnum, underpinned growth with an improvement of "high single digits" over the past year, CEO Hein Schumacher said.
"The whole summer has benefited ice cream companies, but has also benefited us," Schumacher added.
Combined cocoa grind data from the main regions that process the ingredient, a proxy for chocolate demand, improved in the third quarter of the calendar year, as demand recovered further from the 2025 slump.
Still, Barry Callebaut must demonstrate that volume growth can translate into better earnings, Zuercher Kantonalbank analysts wrote, adding that cocoa bean prices would be a "critical factor".
Barry Callebaut also said its partnership agreement with Hershey HSY.N would expire at the end of 2027, impacting volumes by 1% in fiscal 2026/27, which Vontobel analysts called a negative surprise.
($1 = 0.7433 pounds)

(Reporting by Paolo Laudani and Isabela Kruczyńska in Gdansk, editing by Anna Pruchnicka and Milla Nissi-Prussak)
((Paolo.Laudani@thomsonreuters.com;))