Message from the CEO
Letter to Shareholders
“Smart growth” getting traction, strong free cash flow
Twenty years ago, Callebaut and Cacao Barry merged to form Barry Callebaut. Since then, we have created the world’s leading chocolate and cocoa company. Over all those years, we have remained focused on generating value in the long term for our shareholders and all other stakeholders.
Fiscal year 2015/16 in brief
- Sales volume up +2.2%: strong chocolate business (+7.6%) and intentional phase-out of less profitable contracts in cocoa products (-12.0%)
- Operating profit (EBIT) as anticipated, flat +0.1% in local currencies
(–3.2% in CHF); net profit down -5.1% in local currencies (-8.7% in CHF)
- Strong free cash flow generation of CHF 404.0 million
- Andreas Jacobs to step down as Chairman of the Board of Directors; Patrick De Maeseneire proposed for election as new Chairman. All other Board members are standing for re-election for another term of office of one year
- Proposed payout to shareholders of CHF 15.50 per share; payout ratio of 39%
- Mid-term guidance1 confirmed
1 On average for the 3-year period 2015/16 to 2017/18: 4–6% volume growth and EBIT above volume growth in local currencies, barring any major unforeseen events.
+0.1% in local currencies
(5.1%) in local currencies
Free cash flow
Payout ratio 39%
Strong growth across the Region
Region EMEA delivered a solid performance with well above market volume growth in both the Food Manufacturers and the Gourmet businesses in Western as well as Eastern Europe.
+4.4% in local currencies
Sustained high performance
Region Americas had a very good year with strong growth in Food Manufacturers and double-digit growth in Gourmet, largely driven by new products and market share gains.
+12.0% in local currencies
Region Asia Pacific
Solid top- and bottom-line growth
Our chocolate business in Region Asia Pacific gained momentum and recorded double-digit volume growth in the Food Manufacturers and the Gourmet businesses, as well as in EBIT.
+17.9% in local currencies
Intentional phase-out of less profitable contracts
In response to a historically weak cocoa products market and to fully leverage our global scale in cocoa, we continued to adapt our business model through the Cocoa Leadership project.
(60.3%) in local currencies
This is Barry Callebaut
What we do
We are the world’s leading manufacturer of chocolate and cocoa products, mastering every step in the value chain from the sourcing of raw materials to the production of the finest chocolates.
Barry Callebaut aims to outperform the global chocolate and cocoa market. This ambitious long-term strategy is based on four pillars:
The highlights in fiscal year 2015/16
These are the highlights in fiscal year 2015/16 along our four strategic pillars - Expansion, Innovation, Cost Leadership and Sustainability:
Fast-growing market - 10% p.a. sales revenue growth in the general out-of-home beverage category
Expanding our Beverages offering in Europe
Our Beverage business recorded strong growth during the past several years, benefiting from the increasing trend towards out-of-home consumption. To capitalize on this trend we acquired the commercial beverage vending activities from FrieslandCampina Kievit. To support the further growth of our Beverages division, we also opened the first of its kind Beverage Academy Center in Kageröd/Sweden, modelled on our global network of 19 Chocolate Academies.
More than 200 co-creation sessions conducted with customers
Welcome to the Barry Callebaut Studio!
Our extensive research confirmed: The artisanal experience is no longer reserved for artisans. Today, it has extended into mass market and consumers expect the same quality and service from their favorite brands. To support our customers, we introduced the Barry Callebaut STUDIO concept. Through this unique selling proposition we offer a brand new way to craft and co-create products meeting the expectations of tomorrow´s discerning consumers.
More than CHF 150 million working capital reduction, supported by a 3-year inventory reduction program
Optimizing product flows, reducing working capital
With the continued implementation of the multi-year “Cocoa Leadership” project, we aim to fully leverage our global scale in cocoa and drive down our costs. Our 3-year Working Capital reduction program is a key part of this effort; this year, we achieved a reduction of CHF 156 million. Moving forward, this program will result in lower costs, better free cash flows and lower net debt. Together with strict cost discipline, all this will fuel the successful implementation of our “smart growth” strategy.
65,000 cocoa farmers to participate in “Katchilè” across Côte d`Ivoire
“None of us can do it alone!”
To collect and organize comprehensive farm data for traceability purposes, we developed a dedicated cloud-based App: “Katchilè” - named after the Baoulé word for change. Cocoa farmers now have access to professional support for better farm management at their fingertips. In addition, with two long-term projects and partnerships we complemented our efforts in empowering farmers to increase cocoa production as well as supporting the role of women in cocoa communities.
More than 12 years with the company
Developing our people: trust in leadership
As Managing Director since May 2016, Charity Sackitey is the face of Barry Callebaut in Ghana. During her twelve years with our company, Charity has exhibited strong leadership and an impressive track record of accomplishments in plant operations, people management, quality assurance, and Environment, Health and Safety (EHS). Barry Callebaut is proud to have supported Charity´s successful career path.
Chairman's Award 2016
Value & Chairman´s Awards 2016
The Value Award recognizes managers and their teams who are willing to go the extra mile. The awards were given for each of our five company values: customer focus, passion, entrepreneurship, team spirit and integrity.
The Chairman´s Award recognizes employees who have been with Barry Callebaut for a number of years and have demonstrated outstanding performance at work, as well as a strong commitment to their local communities.
Barry Callebaut is fully committed to good Corporate Governance. Our principles and rules are laid down in the company's Articles of Association, the Internal Regulations of the Board of Directors and the Charters of the Board Committees. We have prepared our Corporate Governance Report in accordance with the principles of the Directive Corporate Governance (DCG) issued by the Swiss Stock Exchange SIX.
Board of Directors
Many thanks, Andreas Jacobs!
Barry Callebaut’s remarkable success is clearly attributable to the stewardship and farsightedness of Andreas Jacobs. Andreas Jacobs joined the Board of Directors in 2003 and was elected its chairman in December 2005. After eleven years at the helm of our company, he will be stepping down from his post at the Annual General Meeting 2016.
Barry Callebaut owes its departing chairman a lot. The company’s undisputed global leadership in cocoa and chocolate production is largely due to the bold strategic decisions that Andreas Jacobs made in recent years. He had the strength and determination to turn his visions into reality. Andreas Jacobs had little appetite for short-termism nor was he obsessed with the next set of quarterly results, neither as Chairman nor as a representative of Jacobs Holding AG, our majority shareholder. Passionate and knowledgeable about every aspect of the company, caring for the people as much as he was for building the business for the long term, Andreas Jacobs has been a formidable ambassador of Barry Callebaut with all its stakeholders. As custodian of family values which are at the heart of our company, he carefully introduced his brother Nicolas Jacobs to the duties of a Director enabling the family’s intergenerational succession plan.
The Jacobs family will therefore continue to be duly represented on our Board.
We would like to express our sincere gratitude to Andreas Jacobs for his strong leadership that has helped make Barry Callebaut what it is today.
Board of Directors, Executive Committee and employees of Barry Callebaut