# Factory shutdown to hit Barry Callebaut after 9-month sales rise
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-07-20
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Barry Callebaut Expects Notable Financial Impact from Wieze
Meta Description: Barry Callebaut anticipates a significant financial impact in the fourth quarter due to factory closure, despite strong demand driving sales growth.
URL: https://financedigest.com/factory-shutdown-to-hit-barry-callebaut-after-9-month-sales-risehtml

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By Silke Koltrowitz

ZURICH (Reuters) -Barry Callebaut expects a “notable financial impact” in its fourth quarter from the shutdown of its Wieze factory as the world’s biggest chocolate maker said on Wednesday that strong demand boosted sales in the nine months to May.

Sales volumes grew 7.9% to 1,751 thousand tonnes in the first nine months of Barry Callebaut’s fiscal year 2021/22, while sales revenue increased 13.5% to 6.076 billion Swiss francs ($6.27 billion), the Zurich-based group said in a statement, also confirming its mid-term targets.

The global chocolate confectionery market grew only 1.4% during that period, Barry Callebaut said, and it outpaced it thanks to strong demand across regions and a [continued recovery](https://www.financedigest.com/hotel-group-accor-continues-post-covid-recovery-after-a-gorgeous-summer.html "Hotel group Accor continues post-COVID recovery after a ‘gorgeous’ summer") in its gourmet business that caters to bakeries and chefs.

The company halted production at its Wieze site in Belgium – the world’s [biggest chocolate factory](https://www.financedigest.com/japans-factory-output-posts-biggest-fall-in-8-months-on-weak-autos-chips-sectors.html "Japan’s factory output posts biggest fall in 8 months on weak autos, chips sectors") – after detecting salmonella in June, but said cleaning was progressing well and it expected to restart production early next month and return to full capacity over the following weeks.

Though the full [financial impact](https://www.financedigest.com/how-mifid-ii-will-impact-financial-advisor-communications.html "HOW MIFID II WILL IMPACT FINANCIAL ADVISOR COMMUNICATIONS") of the incident is still being assessed, the Group expects it to be notable for the financial results in the fourth quarter 2021/22,” it said.

I assume a 2% [group impact](https://www.financedigest.com/uk-report-warns-of-impact-of-islamist-groups-in-prisons.html "UK report warns of impact of Islamist groups in prisons") on a full-year basis from the factory’s temporary closure, its biggest and around a fifth of group volume,” said Kepler Cheuvreux analyst Jon Cox, adding that the negative impact could reach 10% in the quarter.

Shares, down about 5% so far this year, [opened 0.4% higher](https://www.financedigest.com/wall-street-seen-opening-higher-but-u-s-recession-priced-in.html "Wall Street seen opening higher but U.S. recession priced in").

Barry Callebaut, which passes higher [raw material](https://www.financedigest.com/henkel-trims-earnings-outlook-on-raw-material-price-spike.html "Henkel trims earnings outlook on raw material price spike") costs on to customers like Nestle, confirmed it expects average volume growth of 5-7% per year and earnings before interest and tax above volume growth in local currencies for the period ending on Aug. 31 [next year](https://www.financedigest.com/next-years-geneva-auto-show-cancelled-organisers.html "Next year’s Geneva auto show cancelled -organisers").

($1 = 0.9683 [Swiss francs)](https://www.financedigest.com/swiss-franc-grapples-with-safe-haven-identity-crisis-after-credit-suisse.html "Swiss franc grapples with safe-haven identity crisis after Credit Suisse")

(Reporting by Silke Koltrowitz, editing by Kirsti Knolle, Michael Shields and Louise Heavens)


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