Breville faces a slowing consumer and economic headwinds but has pledged earnings growth in 2024

The brand famous for its toasters, juicers and sandwich makers has hiked its dividend, raised profits and pledged to grow earnings in 2024 despite the consumer slowdown.

Breville, the maker of coffee machines and juicers, has posted a small rise in revenue and profit despite subdued consumer confidence and spending across its key global markets.

It pledged to increase earnings in 2024 as it battles a range of economic headwinds.

The company said 2024 appeared similar to last year, with challenges offset by positive developments, including new product launches, maturing geo­graphies and cost improvements.

The bankruptcy of retailer Bed Bath & Beyond – one of Breville’s larger retail customers in the US – and the acquisition of Italian coffee machine company Lelit increased the volatility of regional numbers and half-on-half comparisons.

However, the threat of inflation remained, as did retailer destocking, with customers buying Breville products already in the warehouses.

On Monday, Breville announced a full-year net profit of $110.2m, up 4.2 per cent and slightly ahead of market expectations of $106m. Sales for the period rose 4.2 per cent to $1.478bn.

Shares in Breville rallied 20 per cent on the result before closing nearly 9 per cent higher at $25.23.

The company, known for its toasters, kettles and sandwich makers, declared a final dividend of 15.5c, up from 15c per share, and payable on October 5.

Breville’s biggest shareholder is billionaire businessman Solomon Lew, whose combined Premier Investments arm and private interests control 31.96 per cent of the company.

Overall, reported inventory was relatively flat, with core inventory managed down $96.6m through reduced second-half purchases rather than discounted sales. Further inventory reductions are expected in fiscal 2024.

Breville chief executive Jim Clayton said it was a solid year for the group.

“(We’re) delivering guidance once again, against a challenging and dynamic backdrop with a subdued consumer, inflationary headwinds, a strong denominator, and retailer destocking,” Mr Clayton.

“Having doubled the size of the business in the last five years, the strength of our geographic portfolio again came through in the second half as Europe, Middle East and Africa (EMEA) accelerated to pick up the slack in the Americas as Bed Bath & Beyond slowly exited the market.

“I was encouraged to see our new product launches firing again and to see strong growth in new markets. We managed margins well, demonstrating the pricing power of our premium products, and commercially chose to manage down inventory through reduced purchases rather than off-brand discounting.”

In a lower growth year, expenses were moderated to reliably deliver EBIT at the top end of guidance, Mr Clayton said.

“We enter fiscal 2024 in a solid position with our (product) pipeline continuing to release, new markets maturing, our solution offering developing and cost pressures moderating.”

In its Americas region, sales of $701.2m were up 15.9 per cent. Sales in the Asia Pacific rose 5 per cent to $292.2m but in EMEA they fell 3.2 per cent to $285.8m.

The group pledged to hit earnings targets in 2024 despite the economic slowdown.

“It is too early to predict how these forces will play out across the whole year, but our expense budget is again set with flexibility to deliver EBIT growth under a range of probable revenue scenarios,” Mr Clayton said.

Analysts said Asia Pacific revenue was better than expected, driven by market share gains.