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Barry Callebaut (CH:BARN)
:BARN
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Barry Callebaut AG
(BARN)
Rating:63Neutral
Price Target:
CHF959.00
▲(6.56%Upside)
Positive Factors
Cocoa Beans Price
The overall cocoa beans price normalisation looks underway, likely to fuel solid FCF next year.
Price Target
Upside to Price Target (%) 30.8.
Valuation
At 10x 12-month forward P/E, valuation looks attractive, reflecting a nearly 60% discount to Barry Callebaut’s ten-year 12-month forward average.
Negative Factors
Earnings
Last week's 1H25 earnings release was disappointing with a significant miss and the FY25 guidance cut.
Net Profit
Adjusted net profit of CHF64m came in well below estimates driven by delayed pricing to customers and higher financing costs.
Volume Decline
The 1H25 volume decline of -5% missed expectations as delayed orders from customers should have had a bigger impact than anticipated.
Barry Callebaut AG (BARN) vs. iShares MSCI Switzerland ETF (EWL)
Market Cap
CHF5.05B
Dividend Yield3.15%
Average Volume (3M)18.08K
Price to Earnings (P/E)35.1
Beta (1Y)0.63
Revenue Growth45.87%
EPS Growth-49.83%
CountryCH
Employees13,239
SectorConsumer Defensive
Sector Strength55
IndustryFood Confectioners
Share Statistics
EPS (TTM)5.85
Shares Outstanding5,488,858
10 Day Avg. Volume17,720
30 Day Avg. Volume18,077
Financial Highlights & Ratios
PEG Ratio0.82
Price to Book (P/B)2.92
Price to Sales (P/S)0.00
P/FCF Ratio-18.51
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
CHF1,031.11Price Target Upside14.57% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Barry Callebaut AG Business Overview & Revenue Model
Company DescriptionBarry Callebaut AG is a leading global manufacturer of high-quality chocolate and cocoa products, serving the entire food industry, from industrial food manufacturers to artisanal and professional users of chocolate such as chocolatiers, pastry chefs, or bakers. Headquartered in Zurich, Switzerland, the company operates across multiple sectors, including the production of chocolate, compounds, fillings, decorations, and cocoa products. Barry Callebaut AG is known for its extensive range of innovative products and its commitment to sustainability and traceability throughout its supply chain.
How the Company Makes MoneyBarry Callebaut AG generates revenue primarily through the sale of chocolate and cocoa products. The company's key revenue streams include industrial chocolate production for food manufacturers, gourmet and specialty products for artisanal and professional users, and consumer products sold under various brand names. Additionally, Barry Callebaut offers services such as product development, technical assistance, and training for its customers. Significant partnerships, such as long-term supply agreements with major food companies and collaborations with industry stakeholders on sustainability initiatives, also contribute to its earnings. The company's focus on innovation, efficient production processes, and expanding its footprint in emerging markets further bolsters its revenue generation.
Barry Callebaut AG Earnings Call Summary
Earnings Call Date:Apr 10, 2025
(Q2-2025)
| % Change Since: -14.69%|
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted Barry Callebaut's strategic advancements and financial stability through its investment program and secured liquidity. However, significant challenges from cocoa bean price volatility, increased operational costs, and volume declines weighed heavily on financial performance. The company is navigating these challenges with delayed cost savings implementation.Q2-2025 Updates
Positive Updates
Strong Progress in Next Level Investment Program
Barry Callebaut has achieved 40% of the CHF250 million synergy target, with 36% of SKUs phased out and significant advancements in factory footprint optimization and digital initiatives.
Secured Liquidity and Financial Stability
The company successfully raised financing through a CHF300 million Swiss bond and an oversubscribed EUR1.8 billion bond, maintaining a strong balance sheet and comfortable liquidity.
Growth in Gourmet and Specialty Chocolates
Gourmet business showed resilience with a 0.7% volume growth, rebounding to 3.1% in the second quarter. Specialty Chocolates saw positive growth with a double-digit improvement in North America, EMEA, and Latin America.
Negative Updates
Significant Impact of Cocoa Bean Price Volatility
Bean prices nearly doubled year-on-year, leading to increased financing costs and market structure expenses, impacting short-term financial performance.
Volume Decline Driven by Market Dynamics
Overall volume decreased by 4.7% in the first half, with notable declines in Global Cocoa and Global Chocolate segments due to high bean prices and customer behaviors.
High Financing and Operational Costs
Financing costs increased by CHF125 million year-on-year due to higher bean prices and margin calls, coupled with operational challenges leading to a decline in net profit.
Delayed Implementation of Cost Savings
Due to market volatility, there is a 12-month delay in fully realizing the Next Level program's cost savings in the P&L.
Company Guidance
During the call, Barry Callebaut provided guidance on various metrics. They anticipate a mid-single-digit decrease in sales volume due to a challenging environment but are maintaining their commitment to double-digit recurring EBIT growth in local currencies. The company has faced increased financing costs, which rose by CHF125 million year-on-year, primarily due to unprecedented cocoa bean price volatility. The bean price nearly doubled, significantly impacting customer behavior and financial performance. Despite these challenges, Barry Callebaut has secured additional liquidity through euro and Swiss bond issuances and has over 70% of their orders booked for the fiscal year. They are progressing with their Next Level cost savings plan, having achieved 40% of the targeted CHF250 million in synergies, although the full impact on the bottom line is delayed by 12 months due to current market disruptions. The company has also committed to ensuring the dividend per share will not be lower than in fiscal year '23-'24 during the transition period.Barry Callebaut AG Financial Statement Overview
Summary
Barry Callebaut AG shows strong revenue growth and operational efficiency, but faces challenges with increasing financial leverage and negative cash flow. The company needs to address its cash flow issues to maintain financial stability and support future growth.Income Statement
Barry Callebaut AG has demonstrated solid revenue growth over the years, with a notable increase from the previous year. The gross profit margin remains strong, but there has been a decline in net profit margin due to reduced net income. However, the EBIT and EBITDA margins indicate robust operational efficiency.75
Positive
Balance Sheet
The company's financial leverage has increased, as shown by a higher debt-to-equity ratio, indicating rising debt levels. Despite this, the equity ratio remains reasonable, and the return on equity is satisfactory, reflecting the company's ability to generate profits from its equity base.65
Positive
Cash Flow
The cash flow situation is concerning, with a negative free cash flow and operating cash flow. This could challenge the company's ability to finance its operations and growth without external funding. However, the historical ability to maintain free cash flow to net income ratio shows some resilience.50
Neutral
| Breakdown | TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 13.03B | 10.39B | 8.47B | 8.09B | 7.21B | 6.89B |
| Gross Profit | 1.37B | 1.38B | 1.35B | 1.22B | 1.15B | 1.06B |
| EBITDA | 834.89M | 710.41M | 901.65M | 778.83M | 791.98M | 703.71M |
| Net Income | 143.91M | 189.78M | 444.36M | 360.70M | 383.94M | 316.05M |
Balance Sheet | ||||||
| Total Assets | 17.84B | 15.27B | 8.52B | 7.93B | 7.35B | 7.21B |
| Cash, Cash Equivalents and Short-Term Investments | 1.61B | 978.35M | 488.33M | 880.02M | 1.10B | 1.39B |
| Total Debt | 7.72B | 4.80B | 1.80B | 2.08B | 2.38B | 2.76B |
| Total Liabilities | 15.11B | 12.43B | 5.63B | 5.03B | 4.67B | 4.85B |
| Stockholders Equity | 2.72B | 2.84B | 2.90B | 2.90B | 2.68B | 2.35B |
Cash Flow | ||||||
| Free Cash Flow | -3.31B | -2.35B | -456.69M | 189.07M | 428.66M | 271.61M |
| Operating Cash Flow | -3.04B | -2.06B | -215.10M | 464.96M | 704.08M | 552.50M |
| Investing Cash Flow | -287.24M | -280.93M | -230.99M | -301.68M | -265.01M | -304.93M |
| Financing Cash Flow | 4.42B | 2.77B | -555.00M | -381.50M | -618.98M | 591.13M |
Barry Callebaut AG Technical Analysis
Positive
900.00
Price Trends
818.10
Positive
941.86
Negative
1120.41
Negative
Market Momentum
21.84
Negative
62.29
Neutral
84.24
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:BARN, the sentiment is Positive. The current price of 900 is above the 20-day moving average (MA) of 885.55, above the 50-day MA of 818.10, and below the 200-day MA of 1120.41, indicating a neutral trend. The MACD of 21.84 indicates Negative momentum. The RSI at 62.29 is Neutral, neither overbought nor oversold. The STOCH value of 84.24 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CH:BARN.
Barry Callebaut AG Peers Comparison
Overall Rating
UnderperformOutperform
Sector (70)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | CHF30.53B | 45.46 | 0.93% | 5.14% | 0.98% | ||
76 Outperform | CHF2.05B | 21.21 | 30.84% | ― | ― | ― | |
72 Outperform | CHF35.66B | 32.70 | 1.81% | 7.19% | 22.07% | ||
70 Outperform | $4.23B | 19.19 | 19.01% | 2.09% | 2.51% | 18.26% | |
70 Neutral | CHF40.00B | 26.25 | 19.01% | 2.35% | 9.18% | -0.59% | |
67 Neutral | $199.86B | 18.86 | 30.10% | 3.13% | -1.77% | -0.85% | |
63 Neutral | CHF5.05B | 35.08 | 3.15% | 45.87% | -49.83% |
* Consumer Defensive Sector Average
Performance Comparison
CH:BARN
Barry Callebaut AG
927.00
-579.59
-38.47%
CH:ARYN
ARYZTA AG
81.45
15.89
24.24%
CH:NESN
Nestlé SA
79.27
-10.35
-11.55%
CH:GIVN
Givaudan SA
3,869.00
-358.99
-8.49%
CH:LISN
Chocoladefabriken Lindt & Spruengli AG
131,400.00
25,184.22
23.71%
CH:EMMN
Emmi AG
764.00
-130.66
-14.60%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.