Breville books double-digit sales, profit growth despite rising inflation, war in Ukraine and stretched household budgets
Shoppers, especially in the US, snapped up Breville coffee machines and juicers as the company booked double-digit profit growth and record sales.
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Kitchen appliance maker Breville has brushed past soaring inflation, delayed shipping and the war in Ukraine to deliver a big jump in profit as shoppers eagerly bought its coffee machines and juicers.
The company, which counts billionaire Solomon Lew as its biggest investor, performed especially strongly in North America where the popularity and strong sales for its Breville range helped counter the slight pull back in performance in Europe in the wake of the Russia invasion of Ukraine.
And while the group is cautious about the continued impact of rising inflation, stresses on household budgets and disruptions from the Ukrainian conflict it believes its pricing power for the well-known Breville brand and new product launches will help bolster its returns over 2023.
Breville’s biggest shareholder is Mr Lew and combined his Premier Investments and private interests control 31.96 per cent of the company.
The company, known for its range of coffee machines, juicers and sandwich makers, on Tuesday posted a 19.4 per cent jump in full-year sales to a record $1.418bn as profit rose more than 16 per cent to $105.7m.
The company said second half revenue growth rate moderated to 13.2 per cent as revenue acceleration in the Americas, its biggest market, partially offset softness in Europe and the Middle East, as consumers and retailers reacted to the Ukraine invasion.
Gross margins were well managed, Breville added, with demonstrated pricing power in the global segment, offsetting an inflationary backdrop of increased freight and product costs and a strong US dollar.
Its full-year earnings jumped nearly 15 per cent to $156.4m, in-line with guidance and delivered another year of double-digit earnings growth.
“A solid year of performance for the group, delivering guidance once again, against a dynamic backdrop of supply chain challenges, inflationary pressures, and headwinds resulting from the Ukraine invasion,” said Breville chief executive Jim Clayton.
“Having doubled the size of the business in the last four years, the strength of our geographic portfolio came through in 2022 as the Americas accelerated in the second half to pick up the slack in Europe.
“We managed margins well, demonstrating the pricing power of our brand and our premium products.
“The investment in growth drivers continued, while demonstrating the ability to align expenses with revenue, within the envelope of guidance.”
In the Americas, Breville’s sales jumped nearly 23 per cent to $605m, while sales in Europe, Middle East and Africa rose 14.8 per cent to $295.1m. Sales across the Asia Pacific region rose 18.9 per cent to $278.4m.
Mr Clayton said the company entered the 2023 financial year in a solid position.
“We’ve successfully pulled forward our inventory build for the first half of 2023, and our new product development pipeline is beginning to release.”
A final dividend of 15c a share was declared, up from 13.5c, payable on October 6.
Originally published as Breville books double-digit sales, profit growth despite rising inflation, war in Ukraine and stretched household budgets
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