Bakkavor sales rise 3.2% in second quarter

Bakkavor owners Agust and Lydur Gudmundsson reported sales increase of 3.2%

Bakkavor has reported a 3.2% rise in second-quarter sales, boosted by strong international revenues.

The chilled foods manufacturer reported revenues of £438.7M for the 13 weeks to June 25. The company said international sales rose by almost 20% on the prior year, as it continues to “build foundations for future growth” in the US and Asia.

About 90% of the company’s reported sales came from the UK; a total of £394.8M, representing growth of 2.8% on a like-for-like basis. The increased revenue represents a 0.9% increase in its adjusted Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) margin on 2015.

‘Excellent set of results’

Bakkavor ceo Agust Gudmundsson said: “I am pleased to report another excellent set of results for the group, with both strong revenue and EBITDA growth across our businesses.

“We are planning to continue our accelerated capital investment programme to support our ongoing growth with key customers and drive further performance benefits.”

A cash dividend of £36.3M was used to buy the outstanding Bakkavor Group shares that Bakk AL Holdings had not already purchased. Bakk AL Holdings is owned by Bakkavor founders Lydur and Agust Gudmundsson, after they teamed up with one of the world’s largest hedge fund firms to buy out Bakkavor’s Icelandic institutions in January. Therefore, net debt slightly increased on the prior year, despite the positive trading results.

Free cash generation was slightly down in the quarter too. The company said its capital investment programme was to blame for the slight decrease, as its investment offset profitability.

‘Well placed for the future’

The group said the company was “well placed for the future”, despite the economic uncertainty following June’s Brexit vote. It acknowledged Brexit and the introduction of the National Living Wage posed challenges for the sector as a whole.

Agust said: “Although the UK is entering a period of some economic uncertainty following the recent EU referendum, we believe we are well placed to manage the challenges that may lie ahead.”

Meanwhile, the company completed the sale of its Belgian fresh prepared food business Vaco in July. Bakkavor said the deal completed its strategic goal to leave the Continental Europe market, and focus on the growth in the US and Asia.

 

Bakkavor Q2 results – at a glance
  • 3.2% sales increase on prior year
  • Total revenue of £438.7M
  • International sales rose 17.7%

Related News

Bakkavor are recruiting for 40 roles at its soups and sauces factory

Bakkavor advertises for 40 soups and sauces staff

Top food manufacturers' reported dip in growth for first time in 15 years

Food and drink producers’ revenue falls to 15-year low

Bakkavor ran a cooking masterclass for young people last week

Bakkavor masterclass trains bakers of the future

Marmite sales grew as a result of publicity created during the Tesco and Unilever pricing dispute

Marmite sales boosted by Tesco price dispute

Bakkavor boss Agust Gudmundsson attributed growth to investment, improved efficiency and constant innovation

Bakkavor results boosted by ‘constant innovation’

Bakkavor in 310 new staff recruitment drive

Bakkavor to recruit 310 staff after ‘increased demand’

Bakkavor are to hire 100 workers at its Bourne Prepared Foods factory

Bakkavor to recruit 100 staff at Bourne factory

Bakkavor is to recruit 150 workers at one of its salad processing facilities in Dover

Bakkavor to recruit 150 staff at salad facility

Bakkavor Group has sold Vaco to Culinor Food Group (Image provided by I Believe I Can Fry/Flickr)

Bakkavor sells Belgian ready-meal business Vaco

GMB will protest at Tesco HQ

Bakkavor slams union protest at Tesco headquarters

Bakkavor workers plan to protest at Sainsbury headquarters on Friday

Bakkavor row sparks union protest at Sainsbury

Bakkavor founders Lydur (left) and Agust Gudmundsson

Bakkavor: trading conditions to ‘remain challenging’

Food manufacturer launches big recruitment drive

Bakkavor to recruit 470 to meet desserts demand

Bakkavor recently recalled chilled guacamole products, due to the possible presence of salmonella

Bakkavor recalls chilled guacamole over salmonella fear

Submit a comment

Your comment has been saved

Post a comment

Please note that any information that you supply is protected by our Privacy and Cookie Policy. Access to all documents and request for further information are available to all users at no costs, In order to provide you with this free service, William Reed Business Media SAS does share your information with companies that have content on this site. When you access a document or request further information from this site, your information maybe shared with the owners of that document or information.