Breville Earnings: Strong Brands Afford Pricing Power

We maintain our AUD 20 fair value estimate for shares in Breville. Despite a relatively challenged macroenvironment, including input cost inflation, the bankruptcy of major U.S. customer Bed Bath & Beyond, and generally weaker consumer spending, fiscal 2023 operating earnings increased by 10% to AUD 172 million—at the top end of the February 2023 guidance range and 1% above our forecast. Headwinds were more than offset by geographic expansion, price increases, and earnings from the AUD 140 million Lelit acquisition.