Strong H2 23, marking the return to the long-term profitability algorithm

PRESS RELEASE

Amsterdam, 21 February 2024

Key items1

Organic sales up +3.9% (H2 23: +4.3%), with positive volume/mix momentum in H2
Organic adj. EBIT up +1.1% (H2 23: +5.5%); up more than 6% FY when excluding Russia's performance
Organic adj. gross profit increased +2.9% (H2 23: +4.7%), from premiumisation and efficiencies
Free cash flow of EUR 522 million and leverage of 2.7x, despite currency headwinds
Underlying EPS of EUR 1.51, with strong operating result offset by fair value changes of derivatives & FX
GHG emissions reduced by 9% in 2023, cumulating to -21% in Scope 1 & 2 and -9% in Scope 3 vs 2020
Proposal to pay a cash dividend of EUR 0.70 per share in two equal instalments
A message from Fabien Simon, CEO of JDE Peet’s

“We concluded 2023 with a very strong second semester, marked by an acceleration of JDE Peet’s organic top line and adjusted EBIT growth. We are back to our long-term profitability algorithm, excluding Russia's performance. While the Coffee industry had been confronted with compounding disruptions over the last 3 years, our 2023 performance is the result of the agility and disciplined execution of the transformation we went through since 2021, to become a more global, more digital, and more sustainable company.

We are rediscovering the power of our brands. While we stepped-up investments, execution and innovation, we have brought back relevance for our consumers and customers. As a result, we have gained market shares globally in 2023 across the premium coffee categories of Single-Serve, Instant and Beans.

In 2023, JDE Peet’s was recognised as an innovation leader (GlobalData), as well as an industry mover in sustainability (S&P Global). We brought industry-first innovation with home-recyclable paper packs for instant coffee, and are leading progress on deforestation by leveraging AI and inclusive ecosystems at origin countries.

We are holding ground in Europe, growing double-digit in China, and are accelerating our globalisation organically, and more recently inorganically in the largest global coffee markets in value (US) and in cups (Brazil).

Strengthening our fundamentals, our brands and our innovation capabilities is elevating our premium growth trajectory and brings confidence in our ability to create sustaining long-term shareholder returns and societal value.”

Sustainability

We continued to achieve meaningful results for each of the three pillars of our Common Grounds programme, that embodies our ambition to positively impact people, our planet, and the future of coffee & tea, and is driven by our purpose "To unleash the possibilities of coffee & tea for a better future".

During the year, we made strong progress on our goal towards 100% responsibly sourced green coffee by 2025, reaching 83.8% (2022: 77%). By year end, we had a portfolio of 63 active projects, through which we have reached more than 108,000 additional smallholder farmers, bringing the total number of smallholder farmers we have reached since 2015, to 700,900. 100% of the palm oil we used in 2023 was responsibly sourced, and we are on track to reach our goal towards 100% responsibly sourced tea in 2025.

We also continued to make strong progress in reducing our footprint with a reduction of -21% in Scope 1 & 2 emissions and -9% in Scope 3 emissions versus base year 2020. We also substantially increased our sustainability ambitions by defining a comprehensive strategic plan to deliver on our long-term targets, including new and stronger SBTi goals to net-zero, and we have built an integrated carbon accounting platform to track and accelerate the delivery of our Sustainability objectives.

In 2023, our pay-equity gap remained below 1%, which is well under the future's EU directive's threshold of 5%, and 41% of all leadership positions within JDE Peet's were held by women.

Outlook 2024

JDE Peet's expects the following for 2024:

Organic sales growth at the lower end of the medium-term range of 3 to 5%
Mid-single-digit organic adjusted EBIT growth, excluding Russia's performance;
Total company: low single-digit growth in H1 and mid-single-digit growth in H2
Net leverage of around 3x (including Maratá and Caribou transactions) supported by Free Cash Flow above the level of FY 23
A stable dividend
Dividend

JDE Peet's' Board proposes to pay a dividend of EUR 0.70 per share in cash related to FY 23. The dividend will be paid in two instalments of EUR 0.35 each. The first payment date will be on Friday, 12 July 2024, with the ex-dividend date on Monday, 8 July 2024 and the record date on Tuesday, 9 July 2024. The second payment date will be on Friday, 24 January 2025, with the ex-dividend date on Monday, 20 January 2025 and the record date on Tuesday, 21 January 2025. The dividend proposal is subject to approval by the Annual General Meeting of Shareholders to be held on Thursday, 30 May 2024.

FINANCIAL REVIEW FULL-YEAR 2023

in EUR m (unless otherwise stated)

see & read more on
https://www.globenewswire.com/news-release/2024/02/21/2832441/0/en/JDE-Peet-s-reports-full-year-results-2023.html