TMICC Q3 trading update: Overview
- TMICC delivered 9.6% organic sales growth during Q3
- Extended European summer boosted sales growth by approximately 2-3%
- Magnum, Ben and Jerry’s and Yasso recorded strong growth
- TMICC raised organic sales growth outlook to 5.5%
- Heatwaves may drive future demand and operational planning challenges
The Magnum Ice Cream Company (TMICC) reports strong sales growth in its Q3 trading update, with the extended European summer boosting it by around 2-3%, according to the company.
Organic sales have grown by 9.6%, while revenue was up by 12.1% year-on-year, at €2.5bn. This was boosted by acquisitions in India and Portugal, which added 2.6%, although it was partially offset by foreign currency translation effects.
TMICC trading update in numbers
- Organic sales growth was 9.6%
- Organic sales growth by region was 8.9% for Europe and ANZ, 3.9% for the Americas and 17.6% for AMEA
- Revenue grew by 12.1% year-on-year.
- Organic volume growth was 7.3%
- Organic volume growth by region was 11.6% for Europe and ANZ, 1.7% for the Americas and 6.9% for AMEA
- Organic price growth was 2.2%
- Organic price growth by region was 2.4% for Europe and ANZ, 2.2% for the Americas and 10% for AMEA.
These percentages are unaudited.
According to TMICC, the company continues to tailor pack-price architecture and recipes to local consumer needs in the markets it operates.
The company deployed more freezer cabinets in the AMEA region as a result of its high growth.
Big brands saw strong growth
Leading brands have seen significant growth. Magnum sales saw double-digit growth, with a particularly strong performance from Magnum La Pistache. Growth was driven in particular by Türkiye, France, the UK, and Mexico.
Heartbrand, which includes Wall’s, also saw double-digit growth, driven in part by licensing partnerships for brands like Hello Kitty and Bluey in the US. Furthermore, in Europe, the company has been “reinvigorating” Solero, according to TMICC.
Other brands performed well. Ben and Jerry’s grew by 9%, introducing new flavours and formats in Europe and the US, and Cornetto saw high-single-digit growth, driven by its introduction of Cornetto Max Pistachio in Europe and fruit sorbet in Asia.
High-protein yoghurt brand Yasso achieved more than 30% growth, suggesting playing into health and wellness has paid off for TMICC.
Handheld ice cream is also doing well in a landscape influenced by GLP-1s, explains Peter ter Kulve, CEO of TMICC. These forms of portion-controlled ice creams are “booming”.
Full year outlook updated
These results have led to an update of TMICC’s full-year outlook.
TMICC has upgraded its full-year outlook for organic sales growth from 3-5% to 5.5%.
“There is a lot of money in a heatwave.”
Peter ter Kulve, CEO of The Magnum Ice Cream Company
Productivity savings and operating leverage are expected to offset high costs driven by oil and energy prices.
In Q4, the company expects sales to be at a similar level to last year. Q4 often sees lower sales for ice cream.
“Looking ahead, whilst the external environment remains uncertain, the fundamentals of our business are strong,” says CEO ter Kulve. “Our leading brands are gaining momentum, and we continue to be laser focused on executing our growth strategy and productivity programme.”
Ben and Jerry’s is ‘not for sale’
Controversy has long surrounded the relationship between Ben and Jerry’s and its parent companies – first Unilever, now, following its split, TMICC.
The ice-cream brand has often claimed to be silenced by Unilever with regards to its activism, on issues such as the Israel-Palestine conflict and the policies of US President Donald Trump.
Founders Ben Cohen and Jerry Greenfield have been exploring a deal with an executive of private equity firm KKR to separate the brand, according to the Wall Street Journal.
Nevertheless, ter Kulve is adamant: “Ben and Jerry’s is not for sale.”
The brand is “absolutely flying”, he goes on to say, citing strong sales. While Ben and Jerry’s has “always been noisy over the years”, with founder Ben Cohen in particular “trying to create noise”, the brand itself is working well for TMICC.
Preparing for the future
Growing double digits in ice cream is a “logistic tour-de-force”, says ter Kulve, for both warehouses and retailers. The company is working with retailers to make more space for deliveries and improve refrigeration space.
TMICC is helping retailers work in preperation for future heatwaves. There will likely be more heatwaves next year, he says.
“All of us need to learn to work with heatwaves, because there is a lot of money in a heatwave.”
TMICC has had a strong quarter, in part due to the hot weather throughout Europe. If this is to be the new normal, the company must be prepared.
