18th Jan 2024 09:58
(Alliance News) - Bakkavor Group PLC on Thursday said "momentum is building" in all regions, with revenue increasing in its latest year.
The London-based fresh prepared food manufacturer said group revenue totalled GBP2.20 billion for the year that ended on December 30, up 3.0% from GBP2.14 billion the prior year.
UK revenue jumped 3.5% to GBP1.85 billion as Bakkavor continued to grow its market share "driven by strong service, targeted innovation and net business gains". China revenue surged 21% to GBP121.7 million as the business became cash-generative and self-sustaining, and "seamlessly built back volumes" while continuing to diversify into retail.
US revenue fell 10% to GBP229.4 million, but Bakkavor said this was due to its new focus on profit over revenue growth. Consequently, Bakkavor returned to profitability in the second half of 2023 after breaking even in the first six months.
"2023 required us to develop a decisive and dynamic plan to successfully manage another year of external challenges," commented Chief Executive Officer Mike Edwards. "We executed this plan at pace and as a result we expect to deliver improved profitability and reduced leverage for the full year."
The company expects to report adjusted operating profit "at least in line" with the upper range of market expectations. It also anticipates 2024 revenue "to be slightly ahead" of that in 2023, although US "reshaping" and the UK's "continued challenging consumer environment" should cause volumes to "remain subdued".
"As we enter 2024, momentum is building in all three regions, which gives us confidence to deliver further financial improvements in the year ahead," Edwards said. "This is clearly important as unprecedented levels of inflation have impacted profit margins over the last two years."
Shares in Bakkavor rose 2.6% to 94.00 pence on Thursday morning in London.
By Emma Curzon, Alliance News reporter
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