January 25, 2018 / 6:37 AM / a year ago

Aryzta's problems deepen as Europe, U.S. weakness leads to profit warning

Jan 25 (Reuters) - Swiss-Irish baked goods maker Aryzta AG said on Thursday 2018 core profit was expected to fall 15 percent on a like-for-like basis as recent weakness in the European and U.S. markets was not likely to improve this year.

The profit warning comes two weeks after it announced the appointment of a new chief in North America, where issues with undocumented workers and a failed strategy led to Aryzta’s record $1 billion loss in 2017.

The company had previously forecast 2018 earnings before interest, tax, depreciation and amortisation (EBITDA) to be broadly in line with 2017.

In Europe, Brexit-related pressures hurt its UK business, while double-digit inflation in distribution costs and higher-than-expected labour costs dent U.S. profits. (Reporting by Thyagaraju Adinarayan in Gdynia; Editing by Amrutha Gayathri)

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