Small appliance manufacturer, Breville Group, has reported a 15.2% jump in full-year profit, with shares slumping over 6% amid looming US tariffs.
For the twelve months ending June 30, group sales lift 17.5% to $759.9 million (trumping exceptions for $741 million), with net profit hitting $67.4 million.
The company attributes its European expansion, plus “strong” US and “resilient” Australian growth for the earnings hike.
During the year, Australia and New Zealand sales lift 7.2% to $132.9 million.
The company’s Distribution Segment delivered an EBIT increase of $4.9 million, with North American Nespresso and ANZ Breville and Kambrook brands performing well.
Margins jumped from 10.8% to 12.5%, with sales jumping 18.8% to $148 million.
The company has continued to ramp up its R&D investment to amplify sales and margin.
Last month, Breville Group purchased food tech start-up, ChefSteps – renowned for its compact smartphone controlled Joule sous vide immersion circulator.
Breville CEO, Jim Clayton, said retailers will benefit from the deal, with the view of combining ChefSteps’ content and IP into the group’s consumer product portfolio over time.
The acquisition was not expected to have a material impact on earnings in 2020, “but hopefully” in 2021 or 2022.
Shares in Breville are down 6.19% to $18.17 shortly after 2:00pm AEST, after flagging price increases from forthcoming US tariffs.
Strained US-China trade tensions have already impacted 10% of its products with a 25% tariff, with additional tarriffs set to be enforced by the end of the year.
The news comes as the broader ASX 200 slumps, following a drop on Wall Street overnight amid concerns of a US recession.
Breville Group has warned global economic uncertainty made adversely impact its next fiscal year results.
Following its acquisition of ChefSteps, Breville has further unveiled its FY10 Sous Vide Category Range, segmented into; Commercial, Prosumer and Consumer.
Other new products will include a hybrid blender-juice, the ‘3X Bluicer Pro’, ‘3X Bluicer’ and ‘Creatista Pro’ machine which claims to make the “fastest flat white in the world.”
Commentators claim it’s not unlikely the products will be showcased at IFA 2019.
