This week, Italian coffee maker Lavazza cautioned that it was expecting a highly challenging 2022 due to an increase in prices of raw material. This comes after it reported a strong increase in profits in 2021.
The world-famous family-owned company also announced that it has halted all business activity in Russia, and has temporarily suspended distribution in Ukraine.
In a statement, the coffeemakers said the company will have to tackle “an extremely complex and challenging 2022,” citing the rise in raw materials as the major issue.
“First and foremost, green coffee, but also packaging, energy, logistics – and the risks deriving from the dramatic current geopolitical situation,” Chief Executive Antonio Baravalle said.
The Turin-based group also shared that price increases were mainly caused by supply chain issues as well as damage stemming from weather events.
Goods around the world are seeing an increase in prices due to a combination of supply chain issues that started as economies emerged from pandemic related restrictions, and now the geopolitical disruptions being caused by the war in Ukraine.
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) came in at 312 million euros ($337.93 million) in 2021, up 23.3 per cent on 2020.
Sanctions have made it impossible for the country to service its debt obligations
More than 14,000 staff at the company will be given the one-off payment
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