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Lotus Bakeries continued to grow at a strong pace in the first six months, despite the hefty bill to keep the twelve factories open. Investors are enthusiastic.
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The cookie baker from Lembeke
does not disappoint. Sales rose in the first half of the year by more than 8 percent to 323 million euros. In comparison: in the first half of 2019 there was 11 percent growth.
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Does Lotus – which was called Corona-Lotus until the 90s – not suffer from Covid-19 at all? Anyway: sales to catering establishments, airlines, events, schools and hospitals fell silent due to the lockdown. Those out-of-home sectors account for 10 percent of sales.
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However, ‘off-the-shelf’ sales were offset by a shift to home consumption. Lotus owes its sales growth in the half-year report to the international success of its Biscoff biscuits, speculoos spread and ice cream in the supermarkets.
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The healthy bars that Lotus still has in May largely absorbed continued at the start of the year on the strong momentum of 2019. Until the global lockdowns blocked the growth path.
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Significant coronafactuur
Lotus Bakeries warned in early April that the is not immune to the corona crisis. CEO Jan Boone now adds that of significant impact was, on the factories and the way of working. More than 1 million euros were incurred in order to keep the twelve branches going. They deepen the non-recurring operating loss from EUR 2.4 million to EUR 4 million.
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Recurrently, the picture looks much brighter. Gross operating profit (rebitda) increased 10 percent to EUR 67.07 million. There is a net increase of more than 5 percent to 38.2 million euros.
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The net profit per share rose by more than 2 euros, from 44.85 to 47.12 euros – despite the 2.2 million extra shares over which the profit is divided compared to last year.
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CEO Boone expects the same trends in the second half of the year as in the past six months because Covid-19 is still around. “Out-of-home sales will remain under pressure as long as the pandemic is not fully under control.”
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17 on 19
Investors took an advance on a traditionally strong half-year report. The Lotus share has been listed 10 percent higher since the New Year (see graph) and is an example of stability compared to the extreme saw teeth at the fair. Lotus is well on its way to beating the Bel20 for the 17th time in 19 years.
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KBC Securities analyst Guy Sips is enthusiastic about the results. He raises his advice to ‘build up’ and raises the target price to 3,200 euros.
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