Uncertainty Over JDE Peet’s Russian Activities Could Cloud 2024 Outlook

JDE Peet’s, the owner of coffee brands like Douwe Egberts and L’Or, has expressed uncertainty over the future of its Russian business due to new European Union sanctions against Moscow. The Dutch group, which operates its Russian activities as a stand-alone business, has stated that it has taken significant steps beyond the requirements mandated by international sanctions. The 12th package of EU sanctions, taking effect in June, may affect the assessment of who controls those assets and impact the company’s review for its 2024 financial year onwards. The company did not clarify how it would be affected by the sanctions. Moscow took control of food and beverage group Danone’s in July, and a pro-war Russian businessman is planning to take over Danone’s Russian assets for 17.7 billion roubles ($191.52 million). JDE Peet’s shares fell 6.8% to 21.60 euros in early trading, hitting a record low. The group targets mid-single-digit percent organic operating earnings growth in 2024, excluding Russia, and sees annual organic sales growth at the low end of its medium-term guidance range of 3% and 5%.

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