ARYZTA achieved strong organic growth in the first quarter of FY2022, as revenue increased to EUR424.9m, driven by strong volume growth.
ARYZTA achieved 9.8% organic growth in Q1 for continuing operations comprising of 8% volume growth and a 1.8% price/mix improvement. Europe achieved a broadbased double-digit organic growth of 10.1% comprising of 8.6% volume growth and 1.5% price/mix growth, according to a company statement. Rest of world achieved 7.9% organic growth comprising of 4.3% volume growth and 3.6% price/mix growth. Volume growth in Europe outperformed Rest of World due to a continued strong recovery while Rest of world operations were affected by COVID-related lock downs in New Zealand and Australia. The divestment of the Brazilian operation and the Swiss Sandwich business impacted total revenue growth of continuing operations by 1.2%, while currency movement contributed 0.3%.
The Q1 performance reflects the benefits of the new simplified organization and the empowerment of local management to engage with customers. A re-invigorated innovation programme in all markets helped deepen customer engagement leading to an improved margin profile due to beneficial mix changes. Continuing high inflation requires a combination of pricing and acceleration of operational efficiencies to protect the business performance. While pass through pricing mechanisms exist for some channels, the bulk of ARYZTA business relies on annual calendar year pricing agreements. Some new agreements have been finalized. However, pricing discussions remain underway with other customers. Once these are finalized by year end, the new pricing arrangements will be effective for the second half of our financial year.