Profit slumped by around 37 percent to CHF 320.1 million
At the chocolate company Lindt & Sprüngli, the corona crisis caused profits to collapse in 2020. Despite everything, the shareholders should enjoy both a dividend and a share buyback program. In addition, sales and profits are expected to pick up again this year. The bottom line was that profits fell by around 37 percent to 320.1 million francs (290.63 million euros), as the fine chocolate manufacturer announced on its website on Monday evening.
The company thus fell even further behind than in 2014. At that time, Lindt & Sprüngli posted a profit of 342.6 million. Analysts had expected a slightly higher net profit. The shareholders should now still receive a distribution of 110 francs per participation certificate or 1,100 francs per registered share. In the previous year, thanks to a special dividend, they received a total of 1,750 francs per registered share. With the dividend, Lindt exceeded even the boldest expectations of the analysts.
In addition, Lindt is launching a share buyback program with a maximum volume of CHF 750 million. The Board of Directors justified this in the announcement with the high liquidity, the solid balance sheet and the continuously high cash flow. At the operational level, profit fell by almost 30 percent to CHF 420.3 million, which corresponds to a margin of 10.5 percent. Lindt had already announced that the margin would be around 10 percent. Most recently, profitability was just as low in 2009, also at 10.5 percent.
In 2019, the Lindorkugeln manufacturer had earned 13.2 percent of its chocolate sales, restructuring costs in the USA even deducted 15 percent. The company, which is otherwise so used to success, wants to reach this level of 15 percent again in 2022. According to the medium-term requirement, the margin is then to be increased again by 20 to 40 basis points annually. For 2021, the chocolate company now expects an operating profit margin of 13 to 14 percent.
For the current year, the management is also forecasting organic sales growth of 6 to 8 percent, and in the medium to long term it should then go up again by 5 to 7 percent. In 2020, Corona tore a revenue gap of almost half a billion francs or 11 percent in the Lindt coffers. Lindt still had sales of around CHF 4 billion, as the company announced in January.
Some of the losses are due to exchange rate losses. But even at constant exchange rates, organic sales fell by 6.1 percent. It was the first organic drop in sales in over 25 years. In the future, among other things, further investments in the online business should further stimulate growth. Lindt is planning to launch its own new online shops, corporate gift platforms and subscription programs in various countries.
