Latin America has emerged as a key market for the JAB Holding-backed coffee and tea group following the acquisition of Brazil’s Maratá’s in January 2024, with Peet’s Coffee also performing strongly in the US and China during the first half of 2024
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A Peet’s Coffee store in China | Photo credit: Taha
JDE Peet’s has slightly raised its full-year revenue and earnings forecasts after posting robust half-year revenue growth across most markets.
The JAB Holding-backed group, which produces and distributes the Peet’s Coffee, L’or, Jacobs, Douwe Egberts Senseo and Tassimo packaged coffee brands, achieved 5.6% year-on-year sales growth in the six months ending 30 June 2024 to reach €4.2bn ($4.5bn). Total gross profit increased 9% year-on-year to €1.7bn ($1.8bn).
Sales in Europe, which account for 54% of JDE Peet’s total revenues, increased 1% to €2.3bn ($2.4bn) with France, Italy and the Nordic markets among the highest performing during the period.
JDE Peet’s revenues in LARMEA (Latin America, Russia, Middle East and Africa) grew 22% year-on-year to €918m ($995m), boosted by the acquisition of Brazilian coffee and tea business Maratá’s in January 2024.
However, the coffee and tea group said it had increased prices by nearly 10% in the segment during the period to offset challenging market conditions in Brazil and increases in green coffee costs.
In Asia Pacific, year-on-year sales fell 2.4% to €387m ($419m), despite strong out-of-home packaged coffee sales in Malaysia and China.
US specialty café chain Peet’s Coffee achieved 6.4% year-on-year sales growth to €613m ($664m) with like-for-like sales and average ticket size up across its 280 US stores. The California-based coffee roaster and operator also delivered strong double-digit growth in China, where it has more than 200 outlets.
“I am very pleased with this strong set of results for the first half of 2024. We delivered robust, broad-based performance across top-line, profitability and cash flow, despite operating in a challenging environment that continues to be characterised by rising green coffee prices and a growing demand for more affordable offerings,” said Luc Vandevelde, Interim CEO, JDE Peet’s.
Following the results, JDE Peet’s has upgraded its full-year sales and adjusted EBIT growth forecasts from 3% and mid-single digit to 5% and 10% respectively.
In January 2024, JDE Peet’s announced it would take further action to ensure its coffee supply chain complies with rigorous new European Union (EU) anti-deforestation rules (EUDR). Working with sustainability auditor Enveritas, the group will deploy satellite imagery, artificial intelligence (AI) and on-the-ground verification to measure deforestation linked to coffee production in Ethiopia, Papua New Guinea, Tanzania, Uganda, Peru, Honduras and Rwanda, and will provide reforestation assistance to farmers where instances occur.