Breville Group has benefited from the shift to working from home and strong demand for appliances, such as coffee machines, with revenue growing 25.3% to $952.2 million for the year ended 30 June 2020. EBITDA was also up double-digits at 11% for the year.
Revenue for Australia and New Zealand (ANZ) increased 18.4%, despite some stock shortages later in the year, with increasing online adoption in the second half. Sell-in for May and June was most impacted by demand due to sporadic inventory shortages.
Breville general manager for ANZ, Mark O’Kelly told Appliance Retailer that he is extremely proud of the team in delivering double digit growth in the most challenging of environments.
“More recently with COVID-19, all of our team members have been stretched but we have successfully navigated this new norm and have worked collaboratively with all of our retail partners. Our new product pipeline for 2020/21 continues to be robust together with our continued brand investments in-store,” he said.
Europe was the best performing region with 54.8% growth, followed by Rest of World (60.1%) and North America (17.6%).
Breville Group CEO, Jim Clayton said it was another good year despite headwinds from Brexit uncertainty, exchange rates, US tariffs and COVID-19.
“We had our share of good fortunate in terms of our inventory levels and the relevance of our products to the ‘new normal’,” he said.
“Sell-out continues to trend faster than sell-in”
Speaking on one of the most pressing issues currently facing the appliance category – stock availability – Clayton confirmed that sell-out continues to trend faster than sell-in and he expects that to be the case for anyone in the same vertical.
“The demand pattern is more than we expected, and by definition that means you are going to be over-selling and chasing. We have an adaptive sales and operations planning model to do this, but it takes time to catch up.
“We are in decent shape for August but by the time we get into September, we will be in the Christmas sell-in pattern again. But I don’t think what we are experiencing – that sell-out is trending faster than sell-in – is unique to Breville.”
Despite the sell-out trend continuing, Clayton assured investors that the launch cycle for new product will remain unaffected.
“When a product is ready, we will release it,” he said.
“This is in a sense what we have seen in the second half, which is customers are finding our product, no matter what retailers are doing, whether it be our own website or someone else’s. The customers are pushing through the friction to find our product, so if we have a new product, we want it out there, so they have access to it.
“The way that NPD is impacted by COVID-19 is our inability to be co-located with our manufacturer. In the innovation cycle as we learn about what works and doesn’t work, it is all happening through Zoom and leveraging our NPD team in China, whom were working on OPD projects as opposed to high innovation projects like we do in Sydney.
“I think a lot of companies are learning what is doable in this virtual environment and a lot of things have gotten more efficient in the business by being virtual – NPD is the one element that goes the other way – but when it is ready to go, we will launch it.”
Featured image: The Breville Bluicer Pro.