Lotus Bakeries Robust and broad-based volume growth across the three strategic pillars

We updated our model after Lotus Bakeries reported 1H24 sales of €599.3m, up 19.6% y/y, mainly driven by robust and broad-based volume growth of more than 16% across the three strategic pillars. In addition, there was a 3% y/y price effect, combined with FX impact. We saw a) continued momentum and outstanding volume growth in Lotus Biscoff; b) Lotus Natural Foods also continues to outperform the market with double digit growth; and c) Lotus Local Heroes delivered mid-single digit growth above historical trend in 1H24.
The strong volume growth for Lotus Biscoff and Lotus Natural Foods underlines the continued momentum and potential of the brands. Lotus Bakeries is supporting and investing in its brands by increasing media investment in Lotus Biscoff as one of the key activation levers of the Biscoff growth strategy. This will be a long term and sustained investment required to further build the global awareness and ambition for Biscoff: it wants to expand the brand to become the third largest cookie brand in the world. We agree that ,to achieve this, has to invest heavily in extra production capacity and continue to focus on the recently launched innovations.