Kerry Group: North America and Retail Channel Behind; Volumes Guidance Below Expectations

Kerry Group reported preliminary fiscal 2023 results, with volumes down 0.9% and a negative pricing contribution (negative 0.7%) reflecting a deflationary environment. For the fourth quarter, volume growth for the group's largest segment, taste and nutrition, was up 0.1%, versus up 1.1% for the year, primarily driven by the foodservice channel (up strongly by 9.3%) with volumes in the retail channel falling behind (down 2.2% for the year). This reflects customer inventory management (destocking) and softer market dynamics. Within this, emerging-market volumes were up 4.1%, while the Americas region was the main detractor with volumes down 1.8% for the year and down 1.9% in the fourth quarter, driven by North America. The dairy business continues to underperform, down 6.5% for the year and down 7.5% in the fourth quarter, with lower dairy market prices hitting pricing (down 9.3% for the year).