The Israeli food and beverage manufacturer says an ‘outstanding’ quarter for its Strauss Coffee division has driven revenues and offset increasing inflationary headwinds
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Strauss Coffee’s global revenues increased 37% year-on-year | Photo credit: Strauss Group
Strauss Group has credited the strong growth of its coffee businesses in Brazil and Eastern Europe as driving third quarter group sales.
In the three months ended 30 September 2022, Strauss Group generated NIS 2.5bn ($1.7m) revenues – 7% higher than for same period in 2021.
The company said its Strauss Coffee subsidiary achieved ‘outstanding’ revenues of NIS 1.3bn ($887,000), accounting for 52% of total group sales during the quarter.
Strauss Coffee’s global revenues increased 37% year-on-year. Sales grew 34% in Brazil, with strong improvements also notable in Russia and Ukraine (67%), Poland (23%) and Strauss Group’s domestic Israeli market (16%).
The company partners with the Três Corações coffee company in Brazil and has extended its joint venture agreement for a further 20 years. Três Corações increased its share of the roast and ground coffee market in Brazil during the quarter by 2% to 32.5% when compared to the same period in 2021.
"Strauss Coffee posted a quarter of strong performance, Strauss Water is growing admirably, and Strauss's food and beverage business in Israel, excluding confectionery, is maintaining market share and continues to grow nicely. In recent weeks, we announced the extension of our partnership agreement with the Lima family in Brazil for another twenty years and kicked off the Group's restructuring plan in the Israel geography,” said Giora Bardea, CEO, Strauss Group.
Despite the positive results, Strauss Group said inflation and considerable increases in green coffee and shipping prices led to a 10% fall in gross profit in the quarter.
The company also continues to see the impact of a confectionery recall, first announced in April 2022, hinder profit margins.
Founded in 1933, Strauss Group is the largest food and beverage manufacturer in Israel.
In November 2022 the company announced that Shai Babad will become its new CEO on 1 December 2022, replacing Bardea, who has served as CEO since 2018.
Strauss Coffee distributes 16 packaged coffee brands, including Elite Coffee and Beanz in Israel, Ambassador in Russia and Ukraine and Fort and Pedro’s in Poland.