During its Strategic Update Meeting for institutional investors and analysts in Amsterdam, JDE Peet’s provided an update on its achievements and progress versus its strategic roadmap, a selection of preliminary financial results for FY 22 as well as its outlook for 2023.
- JDE Peet’s has made significant progress on its growth and purpose-led strategy that was introduced in March 2021, which supported a strong set of quality results since the company entered the public market.
- The company has successfully accelerated growth in the U.S. and in emerging markets, while strengthening capabilities and competitiveness in digital commerce and single-serve appliances.
- JDE Peet’s’ ESG performance and ambitions substantially increased in 2022. The company has defined the roadmap of initiatives that will enable a new commitment to net zero and built an integrated new carbon accounting platform to track and accelerate the delivery of its ESG objectives.
- The company announced the launch of a new, fully compostable coffee capsule in 2023.
- JDE Peet’s confirmed FY 22 results to be in line with its outlook, provided its outlook for FY 23 and reiterated its medium- to long-term targets.
“I am very pleased with the progress we have made since we introduced our updated strategy two years ago,” Fabien Simon, CEO of JDE Peet’s, said in the announcement. “In spite of the challenging macro-economic environment, we are delivering on our commitments to build a stronger, more productive, and more inclusive enterprise. We kept high-quality standards for our consumers and customers, meaningfully reinvested in core assets, rebuilt employee pride and engagement, transformed from a laggard to a leader in ESG, while resuming cost competitiveness and achieving our financial commitments. Strengthening our fundamentals, our brands and our innovation capabilities elevates our growth trajectory and our ability to create a sustaining long-term shareholder return and societal value.”
Launch of a new, compostable coffee capsule to accelerate the sustainability agenda
According to the announcement, the company will launch a fully compostable capsule in 2023, which will contribute to a circular economy. This new technology allows for a high-quality in-cup experience and will be introduced in selected markets throughout 2023 under L’OR, the global leading grocery brand in espresso capsules.
ESG performance and ambitions
JDE Peet’s also announced significant progress on its sustainability agenda over the last two years. In addition to the reduction of its scope 1 and 2 greenhouse gases by 17% since 2020, one of the key achievements in 2022 was the increase in responsibly sourced coffee from 30% in 2021 to 77%. In 2023, JDE Peet’s will submit its stronger and new SBTi ambition to net zero.
Preliminary FY 2022 financial results
JDE Peet’s confirmed its 2022 outlook and shared the following preliminary, unaudited results related to FY 22:
- Sales increased by 16.4%, driven by organic growth of 11.3%.
- Gross profit increased by 3.3%.
- SG&A increased by 10.6%, driven by working-media and other growth-related investments.
- Adj. EBIT decreased by 5.9%, and organically by -9.3%, as SG&A increased.
- Underlying EPS increased to EUR 1.91.
- Free cash flow of more than EUR 1.3 bn with a net leverage of 2.65x.
The company will publish its FY 22 financial statements as scheduled on February 22, 2023, which may slightly deviate from the preliminary results set out in this announcement.
Outlook FY 2023
- The company shared the following outlook for FY 23:
- Organic sales growth at the high end of its medium-term range of 3–5%.
- Low single-digit organic adjusted EBIT growth, with a moderate increase in SG&A.
- A stable dividend.
Medium- to long-term targets reiterated
For the medium- to long-term, JDE Peet's continues to target organic sales growth of 3 to 5% and mid-single digit organic adjusted EBIT growth, a free cash flow conversion of approximately 70% and stable to increasing dividends over time.