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 pleased to announce its unaudited interim results for the six months ended 26 December 2020.
The half year figures reflect a period impacted by Covid-19 and compare with a 6-month period of strong growth which pre-dates the pandemic.
- Group revenue down 4.1 percent to GBP 152.9 million.
- Group Ebitda*1 down 9.8 percent to GBP 13.1 million.
- Profit before tax down 16.1 percent to GBP 7.4 million.
- Basic EPS (pence per share) 4.1p (H1 2019: 4.9p).
- Net bank debt of GBP 21.5 million (excluding IFRS 16 debt), decreased by GBP 11.1 million (H1 2019: GBP 32.6 million) at 0.9 times annualised Ebitda of the Group (H1 2019: 1.3 times).
- Resilient trading performance against a continued challenging Covid-19 backdrop and against a period of strong growth in the prior year.
- Strong progressive improvement since the initial lockdown with retail up +1.7 percent and foodservice down -27.4 percent for the six months to 26 December 2020 against -8.8 percent and -61.0 percent down respectively for the quarter following the initial lockdown.
- Recovery of foodservice adversely impacted by tightening of government restrictions towards the end of the half
- Gross margin increased to 33.1 percent driven by improvement in factory operational efficiency accompanied by significant reduction in waste, in line with our Operating Brilliance Programme.
- Continued strong cash generation reflecting prudent capital investment and rigorous financial management.
- A new frozen dough ball facility commissioned in Manchester.
- Further innovation in line with consumer trends with
- Award-winning Free From and vegan cakes; and
- Launch of vegan doughnuts and a range of artisan gluten-free breads
- Continued double-digit growth in artisan sourdough breads.
- Product excellence illustrated by the winning of several Quality Food and Drink ‘Q’ Awards.
- Continued investment in development, engagement and health and well-being of employees.
- The avoidance of a no deal Brexit and the associated trade tariffs removes a significant strategic risk for the Group, whilst recognising that there are some additional border supply chain consequences to address.
The Group uses certain Alternative Performance Measures (APMs) which are non-IFRS measures to monitor performance of its operations and of the Group as a whole. The reconciliation to IFRS measures is shown in the Consolidated Statement of Comprehensive Income.
*1 Ebitda is before significant non-recurring, other items (Note 1) and after including the impact of IFRS 16 which was first adopted in the prior year.
Chief Executive’s Commentary
Commenting on the results, John Duffy, Chief Executive of Finsbury Food Group Plc, said: «The first half was a period in which Finsbury again demonstrated its resilience and ability to manage and adapt to the effects of the pandemic. Through careful management of resources, anticipating and responding quickly and effectively to changes in consumer demand, and maximising the benefits of operational initiatives both new and historical, we were able to deliver a robust performance.
«Retail performed very well and was up versus a strong corresponding six-month period in 2019, and while the trajectory of an overall recovery continues to be tempered by the adverse impact of tighter government restrictions on foodservice, we are confident the division will bounce back when trading conditions normalise, particularly when the public sector reopens.
«As we move into the second half, we maintain our focus on delivering organic growth, capitalising on the emerging trends in areas such as artisan and Free From and continuing to leverage our leading position in more established areas such as cake bites and buns + rolls.
«The current operating environment continues to be characterised by near-term uncertainty and a challenging economic backdrop that is likely to remain for some time, but a combination of progress in the roll-out of the vaccine and the avoidance of a ‘no deal’ Brexit provides comfort around the Group’s medium-term prospects. Longer-term, our growth ambitions remain unchanged, and with the progress that is being made behind the scenes to make Finsbury a more efficient and joined-up business, focused on driving synergies and scale benefits across the Group and its supply chain, we are confident we are building the right platform to achieve them.
«I would like to again thank our teams around the UK, whose dedication and hard work since the onset of the pandemic has been exemplary.»