The Kerry Group recorded another year of good growth, business margin expansion and an 8.1% increase in adjusted earnings per share in 2014.
The company said that while the consumer environment across developed and developing markets is changing rapidly, Kerry is well positioned to capitalise on global growth opportunities. Kerry said its group revenue of €5.8 billion was slightly down on last year, but volume growth was higher. It has announced a final dividend per share of 31.5 cent.
Stan McCarthy, Kerry Group's chief executive, says that emerging markets now make up over 25% of Kerry's Ingredients and Flavours business and that success was not just built up last year - Kerry first entered those markets in the 1990s. The region offers a great line of sight for generations to come for Kerry, he added. Associated British Foods yesterday said that people had on average an extra €27 or £20 to spend because of low energy prices and Mr McCarthy says he believes Kerry is entering a new era of income growth for consumers. He also says that consumers are looking for greater variety, better quality and better ingredients that ever before and people are paying more attention to what they consume.
Mr McCarthy said that Kerryconnect, the company's strategy for the integration of systems, processes and information across the business, is taking a bit longer to achieve and will cost about €50m than planned. On Russia, the Kerry CEO says the market there will be a critical one for the company in the future, but is not now a significant part of the current Kerry business. He said the market there had been "growing very nicely" at the start of last year, but then slowed down. He said the company will just have to wait and see how the political situation develops there.
Aer Lingus has reported a loss before tax for 2013 of €111.5m, compared to a profit of €39.6m a year ago due to the once-off contribution of €190m to resolve the pension row at the airline and staff restructuring costs. Its revenue for the year to the end of December was 9.2% higher than in 2013 at €1.5 billion while its operating costs were 8.9% higher at €1.4 billion. Its operating profit at €72m is the highest since the financial crisis, and passenger numbers on its network broke through 11 million for the first time.
Outgoing Aer Lingus chief executive Christoph Mueller said that parties involved in the talks about the IAG bid for Aer Lingus would be well-advised to see the offer in the context of Ireland Inc - that it would be good for the economy as a whole. He said that positions were taken very early in this process before information on such issues as value, connectivity and employment became fully available. He stressed that the airlines are still currently in a consultation phase, and that no offer has been made yet. "The problem for certain political parties is that these hardening positions that were taken in early January are difficult to reverse in public. I'm very confident that we are able to remove all of those concerns that were voiced on value, on connectivity and also on employment," he added,
Mr Mueller said the current talks between the different parties are very constructive. He said the company is not only talking to union officials and to political parties, but first and foremost to its employees. There is a great deal of excitement that we can create jobs on a much larger scale than we would be able to do it on our own, he added.
The Aer Lingus CEO pointed out that Aer Lingus has been the strongest growing carrier on North Atlantic routes and last year saw almost 25% capacity growth compared to the market growth was only 3-4%. He said that means Aer Lingus is taking passengers from other carriers.
"All these other carriers are multiples of our size, and all other carriers are working in a close collaboration in an anti-trust protected environment. We are the only and the smallest independent carrier operating in that environment, and we are very successful, but looking forward I am a believer that Aer Lingus can be much more successful and not only create more jobs but create safer jobs in conjunction with IAG," Mr Mueller stated.
He said the expected offer from IAG is most probably the largest foreign investment into Ireland since the financial crisis - €1.4 billion. "I believe every political party is well-advised to see that in the context of Ireland Inc".
He said that Irish passenger numbers have still not recovered from pre-crisis levels, pointing out that Frankfurt, Amsterdam and Heathrow surpassed these numbers in 2010. "We are now in the year 2015 and we still have a long way to go. We can not leave out chances of growth. It's good for Ireland and good for the economy as a whole", he stated.