Aryzta Q3 2025 slides: Modest growth maintained as cost optimization accelerates

Introduction & Market Context

Aryzta AG (SWX:ARYN) presented its Q3 2025 update on October 20, 2025, reporting organic growth of 0.8% for the quarter, bringing its year-to-date organic growth to 2.1%. The Swiss-based global bakery company continues to navigate a competitive market environment while maintaining its full-year guidance and accelerating cost optimization initiatives.

The modest quarterly growth comes against the backdrop of strong comparative figures from the previous year, with the company emphasizing its strategic focus on innovation and operational efficiency to drive sustainable performance.

Quarterly Performance Highlights

Aryzta reported Q3 FY25 revenue of €554.3 million, representing a 0.8% organic growth compared to the same period last year. This growth was primarily driven by a 1.0% increase in pricing, partially offset by a slight volume/mix decline of 0.2%.

As shown in the following chart detailing the Q3 organic growth components:

For the first nine months of FY25, Aryzta achieved revenue of €1,640.7 million, with organic growth of 2.1%. This performance was balanced between volume/mix contribution of 1.1% and pricing of 1.0%, indicating the company’s ability to grow both through increased sales volume and strategic pricing.

The nine-month revenue breakdown is illustrated in this waterfall chart:

Regional performance showed some variation, with Aryzta Europe (representing 89% of total revenue) posting 0.7% organic growth in Q3, while the Rest of World segment delivered stronger organic growth of 1.4%. However, currency headwinds of -5.6% in the Rest of World segment resulted in a total revenue decline of -4.2% for this division when expressed in euros.

The detailed regional revenue breakdown for the quarter ended September 30, 2025, shows:

Strategic Initiatives

Innovation remains a cornerstone of Aryzta’s growth strategy, accounting for approximately 18% of revenue year-to-date. The company highlighted its investment in new production capacity across multiple regions including Malaysia, Switzerland, Germany, and Australia, positioning itself to capitalize on emerging consumer trends.

The company’s key performance drivers focus on organic growth through bake-off products, which continue to gain market share, supported by the company’s positioning of bakery as "the most efficient calorie" for consumers.

A significant development in Aryzta’s strategy is the strengthening and acceleration of its cost optimization plans. The company outlined a comprehensive approach targeting €40-60 million in savings across operations (€5-10m), procurement (€20-30m), and structural costs (€15-20m). These initiatives will require investments of €20-30 million in digital maturity supported by AI, resulting in expected net savings of €20-30 million.

The following diagram illustrates the company’s cost optimization framework:

Forward-Looking Statements

Aryzta confirmed its guidance for FY25, projecting organic growth in the low to mid-single-digit range, supported by both volume and price. The company expects to achieve at least €300 million in EBITDA and approximately €100 million in free cash flow for the full year.

Looking further ahead, Aryzta reaffirmed its mid-term targets for FY 2025-28, which include:

• Revenue growth above market
• EBITDA margin exceeding 15%
• EBIT margin above 9%
• CAPEX as a percentage of revenue between 3.5-4.5%
• Total net debt leverage of 1.5-2x

These ambitious targets reflect the company’s focus on cash generation, return on investment, and earnings per share growth, as illustrated in this strategic overview:

Competitive Industry Position

Aryzta’s management expressed strong confidence in the company’s ability to deliver on its targets, highlighting the current leadership team’s track record of execution. The company’s strategic positioning in the bake-off segment continues to drive growth, with bakery products described as "the most efficient calorie" in the food industry.

The company’s organic growth trajectory remains within guidance despite challenging market conditions and strong comparative figures from the previous year. The focus on innovation-led growth is evident in the 18% contribution to revenue from new products, demonstrating Aryzta’s ability to respond to evolving consumer preferences.

According to the earnings call transcript, CEO Urs Jordi expressed confidence in Aryzta’s strategic direction, stating, "We will be one of the winners of this day." CFO Martin Hubert added, "We are confident that we have the measures in place to progress towards that flight path." These statements underscore the company’s commitment to its strategic goals despite the competitive challenges in the bakery market.

Aryzta’s stock currently trades at relatively modest valuations with a P/E ratio of 13.08, suggesting potential upside if the company successfully executes its cost optimization plans and achieves its mid-term margin targets. The company’s disciplined approach to cost management and strategic focus on innovation position it to navigate the challenges of pricing pressures and industry consolidation as it works toward its ambitious 2028 targets.

Full presentation:

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