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40
ISSUE 6 2018
INDUSTRY
@IrishFoodMag www.irishfoodmagazine.com
"Evolving consumer trends and the changing marketplace have
provided increased opportunities and demand for Kerry's industry
leading RD&A [research, development and applications] and broad
technology portfolio," said Edmond Scanlon, CEO, Kerry Group, as he
announced another strong performance for the first half of 2018
For the first six months of 2018, reported
revenue for Kerry Group, the global taste and
nutrition and consumer foods group, rose 1.4
per cent to 3.2 billion. Its taste and nutrition
division performed particularly well, up 4.1
per cent in volume terms and 0.6 per cent
in value to achieve revenues of 2.5 billion.
Meanwhile, its consumer foods business
increased volume and value by 1.3 per cent
and 0.9 per cent, respectively, to finish the
first half of the year at 685 million.
Commenting on the performance, Edmond
acknowledged that the taste and nutrition
division is outperforming Kerry's consumer
business. However, he noted, that it remains an
important pillar within the business, feeding into
the insights and consumer understanding for
Kerry's taste and nutrition business.
The half-term results reflect a strong
performance from Kerry's taste technologies
across all regions. In particular, it was noted that
Kerry's TasteSense sugar-reduction technology
and natural extracts have been key drivers of
growth. Kerry's broad clean-label technology
portfolio also performed well, with fermented
ingredients, proteins, nutritional bioactives
and enzyme technologies all delivering good
growth in the period. Edmond noted that the
Group maintained a strong innovation pipeline,
anchored by the ability to create new nutritional
product solutions that meet local consumer taste
preferences across the globe.
`Localising' global products
According to Edmond, this `localisation' of
global products is a key differentiator for Kerry,
enabling the Group to `shift global brands'
throughout its various markets. "Consumers
are looking for products that they believe are
more local perhaps hand crafted or more
personalised to their local tastes as opposed
to global mega brands. That's a key trend we are
seeing globally. People feel that those products
local products are healthier or nutritionally
better. Sometimes they are, sometimes they're
not, but the perception is: the more local, the
better. On top of that, consumers are constantly
looking for new products and the speed of that
development is very short. In the past where a
product could have taken two years to develop,
it is now taking weeks or months to develop."
Edmond says the 'collapse' in the lead-in time
for product development requires the company
to be very close to customers. "So, when we are
looking at investment, whether it's applications,
R&D, manufacturing or marketing, we have to
be close to our customers."
Edmond says Kerry has carefully invested in
its business to ensure it is located close to its
customers. This, he explains, enables faster
response times and service. "In order for us
to help develop a local product, being local
helps. It's a complex area but it's very much
in line with our long-term strategy. If you
look at the way Kerry has developed over the
past 30 or 40 years, we have gone out to the
markets and set up manufacturing facilities,
R&D facilities, and selling services within the
countries that we operate in. That has always
been our strategy." Edmond says that strategy
is serving the business well as it is well
positioned to understand and quickly respond
to local demands.
Clean-label demand
An important and growing trend that Kerry
is responding to is the growing demand for
clean-label products. Currently, 36 per cent of
new product launches from Kerry Group are
clean label. In the US it's over 50 per cent.
"Clean label means different things in different
regions. If I was to take China as an example,
removing monosodium glutamate (MSG)
from a product is considered cleaning up the