Bega Group has projected that its normalized EBITDA will increase by over 20% during the upcoming financial year for the Australian company.
The owner of the Bega and Vegemite brands reported a 2% rise in normalized EBITDA for the year ending June 30, amounting to A$164.1 million ($111.6 million). For the current fiscal year, Bega Group anticipates this figure will reach between A$190 million and A$200 million.
In its official statement, Bega Group emphasized that ongoing efforts to manage costs and enhance cash flow will contribute to profit growth. However, it also noted – with the condition of “subject to normal trading conditions” – that it expects “continued growth” from its branded segment and “a significantly improved performance” in its bulk operations.
Over the year leading up to June 30, the bulk division faced challenges, resulting in a statutory EBITDA loss of A$18.2 million, a sharp decline from a profit of A$38.3 million in the prior year. This was primarily due to a gap between global dairy commodity prices and Australian farmgate milk prices. Bega Cheese has expressed optimism that this discrepancy will begin to close in the coming year.
Conversely, the branded division achieved a remarkable 48% increase in statutory EBITDA, totaling A$206.2 million. The company attributed this success to the “resilience” of its brands, even amid “low consumer confidence and downtrading.”
Overall, Bega Group’s revenue grew by 4%, reaching A$3.52 billion. Notably, 86% of the company’s external revenue is generated from its brands.
This highlights the robust performance and strategic positioning of Bega Group in the competitive food and beverage industry. As the market continues to evolve, trends in the food and drink consumer landscape are crucial for success.
In addition, the business observed an 11% increase in sales from international brand markets, amounting to A$257 million.
In June, Bega Group embarked on a comprehensive review of its peanut processing assets within Australia. Additionally, this week, the company announced it had secured a “binding agreement” to divest its juice extraction facility located in Leeton, New South Wales, to local juice producer Grove Juice.
