Lindt shares tick higher after chocolate maker lifts 2024 margin forecast

Investing.com - Shares in Lindt & Spruengli (SIX:LISN ) rose in early European trading on Tuesday after the chocolate maker hiked its 2024 margin forecast.

In an ad hoc announcement on Tuesday, the Swiss group said it now expects to post an operating profit margin of at least 16% in its 2024 financial year, at the top end of its prior guidance range and up from 15.6% in the previous year.

Organic growth is also tipped to be between 7%-9% in 2025, after sales moved higher by 7.8% to CHF 5.47 billion in 2024 thanks in part to solid returns in several European countries. Operating profit margin is estimated to improve by 20-40 points as well.

Beyond 2025, Lindt & Spruengli reiterated its medium- to long-term organic sales growth goals of 6%-8% and an uptick in operating income margin of 20-40 basis points per year.

The figures suggested that consumer demand for the company's chocolate brands like Lindor and Ghirardelli has been resilient despite recent price increases in response to a near-tripling in cocoa expenses over the course of the year. Cocoa prices surged by roughly 180% last year following an annual spike of 61% in 2023.

Lindt & Spruengli also noted that currency headwinds, particularly a weaker US dollar and euro, had dented its 2024 organic sales result by 2.7%.

The firm called 2024 "challenging", flagging that cocoa prices remained at "a historic high" by the end of the year. Prices will need to rise further in 2025 to help offset the elevated cocoa costs, Lindt & Spruengli said.

More details on the full-year 2024 results are due to be published on March 4.

(Reuters contributed reporting.)

Source: Investing.com