‘Weak consumer climate’ and higher costs hit Tchibo’s full-year earnings

Tchibo recently took steps to improve its finances, including freezing staff pay | Photo credit: Anna Sulencka

Hamburg-based Tchibo ended 2022 in the red after being heavily impacted by increased raw material, energy and freight costs alongside dampened consumer confidence. 
 

The German coffee roaster and retailer reported an EBIT loss of €167m ($182m) last year, compared to a profit of €176m ($192m) in 2021. 
 

While Tchibo’s full-year sales were only 0.3% lower than the year previous at €3.24bn ($3.53bn), overall earnings were hampered by rising costs, global supply chain disruption and increased inventories related to lower sales of non-coffee products. 

Alongside a 900-store European café network and e-commerce channel, Tchibo sells an alternating range of non-coffee products, including clothing, furniture, household items and electrical appliances. 

In August 2022, the coffee roaster and retailer warned that 2022 earnings were likely to be negatively impacted by global supply chain disruption, exacerbated by the war in Ukraine, and rising energy prices. 

While parent company maxingvest expects a ‘weak consumer climate’ to continue through to the end of 2023, the holding company is forecasting a ‘significant improvement’ in Tchibo’s full-year earnings, which should result in positive full-year EBIT. 

The business recently took steps to improve its finances, including freezing staff pay and cutting jobs to return to pre-pandemic employment levels. 

In June 2023, a senior Tchibo official confirmed the business would be eliminating unfilled positions, phasing out temporary contracts and exploring compulsory redundancies. Approximately 300 jobs are expected to be cut by the end of the year. 

Founded in Hamburg 1949, Tchibo also owns UK-based coffee roaster Matthew Algie, which it acquired for an undisclosed sum in August 2016, and Italian coffee roaster, processor and distributor Caffè Molinari, which it purchased in January 2022.