JDE Peet’s, the parent company of Jacobs and Douwe Egberts, has seen its profits and sales volumes fall after sharp price increases. Moreover, the difficult situation in the Russian market is giving the company headaches as well.
Falling profits
JDE Peet’s achieved sales of almost four billion euros in the first half of the year, a 3.5 % increase that was entirely due to price increases. Sales volume fell by 3.3 %, mainly in Europe. Likewise, operating profit dropped 3.0 % to 581 million euros. The producer of international brands like Douwe Egberts, Pickwick, Senseo and Jacobs expects sales growth to improve in the second half of the year.
For the coffee and tea company, Russia remains a problem: JDE Peet’s has decided to remain active in the country as one of very few Western companies. Coffee is an essential product, the multinational explains, and the Russian government has threatened nationalisation should the producer close its coffee roasting plant there. Therefore, the company has decided not to sell international brands in Russia from now on, only local products. The financial impact of this decision is still highly uncertain.
