London / UK. (ffg) British Finsbury Food Group PLC, a leading UK speciality bakery manufacturer of cake, bread and morning goods for both the retail and foodservice channels, is providing an update on trading for the first half of the current financial year, ended 31 December 2016, prior to entering its close period.
The Board is pleased to report that since the AGM trading update in November 2016, trading has continued to be solid throughout the Christmas period and performance is in line with management expectations following the significant growth achieved in recent years. Total Group sales revenues were 156.6 million GBP during the first half, delivering a flat year on year performance. The UK Bakery division declined by 2.9 percent, against a backdrop of UK retail food market deflation in the period, whilst the Overseas division, the Group’s 50 percent owned European business, grew by 31.7 percent continuing to demonstrate the strengths of our strategic diversification.
The Group continues to benefit from strong cash flow and invested a record £5m in capital projects in the first half to build on its successful product innovation and importantly continue to improve efficiency and productivity throughout the Group. The Board has identified continued investment as a fundamental part of the Group’s long-term competitiveness strategy and it will play an important role in helping address the current challenges of sterling induced commodity inflation and planned national living wage increases. As previously communicated, the scale of the current cost inflation is such that despite such internal initiatives, further cost recovery will be required and will become inflationary in the second half and beyond.
The Board has built the Group into a diverse multi-channel speciality bakery group. Following the exceptional growth and diversification over the prior years, the business is well placed to maintain its position, despite the market conditions. As such, the Board believes it is well equipped to continue to deliver growth and improved shareholder value over the coming years.
