Barry Callebaut (BARN) Barclays 19th Annual Global Consumer Conference summary

Appointment of a new CRO from a major customer aims to strengthen supply chain and service reliability. Cultural change is underway, with priorities translated into personal objectives and a co-created action plan to drive buy-in and accountability. Organizational structure shifted to emphasize regional accountability, reducing global headcount and empowering local leadership for better execution. Quality, customer service, and operational fundamentals were identified as critical issues, with significant improvements in service levels and quality incidents since targeted interventions. Focus for Growth strategy prioritizes resources on 10 key countries and two high-margin segments: gourmet and specialty solutions, aiming for margin accretion and market leadership. Outsourcing remains a long-term opportunity, especially with regional players, but large customers are currently in-sourcing due to recent category pressures; growth with these accounts is expected to resume post-2027. Market share gains are expected through improved service and focus on high-value segments, with recent quarters showing share growth despite sector headwinds. Gourmet and specialty segments are targeted for faster-than-average growth, with clear price tiering and innovation platforms supporting margin expansion. Transitioning from a pure chocolate manufacturer to a solutions provider, offering integrated products like inclusions and fillings for sectors such as ice cream and bakery. Medium-term volume growth is projected at 2%-4%, driven by category growth and market share recovery from improved fundamentals. Profitability per ton is expected to recover to pre-COVID levels, with gourmet margin improvement and lower finance charges as key levers. Leverage has been reduced to around 3x net debt/EBITDA, with priorities on investing in core markets, maintaining quality, and opportunistic M&A only after establishing a replicable model.