Coffee Service

JDE Peet’s 2023 earnings slide despite higher revenue; Russia sanctions raise questions

Image: JDE Peet's

February 21, 2024

JDE Peet's, which is owned by JAB Holdings and owns Peet's Coffee, Douwe Egberts, Jacobs and other brands, reported declining profits against a slight revenue gain in 2023 over 2022, according to an earnings report.

The company said on Wednesday that European sanctions against Russia have raised questions about the company's Russia business, according to a Reuters report.

Earnings report highlights include:

Full year sales rose 0.5% from €8.15 billion ($8.81 billion) to €8.19 billion ($8.86 billion). Excluding a -3.7% effect related to foreign exchange and 0.3% related to scope and other changes, total sales increased by 3.9% organically. Organic sales growth reflects a price effect of 4.7% and a volume/mix effect of -0.8%.
Profit fell from €761 million ($822.87 million) to €364 million ($393.59 million) in the comparative years.
Organic EBIT rose 1.1, but rose 6% when excluding Russia.
Basic EPS fell from €1.57 ($1.70) to €0.76 (82 cents).
Diluted EPS fell from €1.55 ($1.68) to €0.75 (81 cents)
Europe sales rose 3.8% to €4.72 billion ($5.1 billion).
Latin America, Russia, Middle East and Africa sales fell 7.3% to €1.5 billion ($1.62 billion).
Peet's sale rose 1.1% to €1.15 billion ($1.24 billion).
Asia Pacific fell 2.9% to €791 million ($855.31 million).

Shares traded today at $14.29 against a 52-week range of $14.29 to $14.41.

"We are back to our long-term profitability algorithm, excluding Russia's performance," CEO Fabien Simon said in the press release. "While the coffee industry had been confronted with compounding disruptions over the last three years, our 2023 performance is the result of the agility and disciplined execution of the transformation we went through since 2021 to become a more global, more digital and more sustainable company."

For 2024 the company expects low single-digit growth in the first half and mid-single-digit growth in the second half.