27th Feb 2020 11:14
(Alliance News) - Bakkavor PLC on Thursday reported a 44% drop in 2019 profit and said that coronavirus is having a "material impact" on the company's international businesses.
The FTSE 250-listed company - which makes ready to eat meals such salads and desserts, said pretax profit in 2019 plunged to GBP43.8 million from GBP77.9 million a year ago. Meanwhile, operating profit fell 19% to GBP69.4 million from GBP85.6 million in 2018, impacted by exceptional costs and start-up losses for new sites.
Revenue for 2019 rose 1.5% to GBP1.89 billion from GBP1.86 billion in 2018, boosted by growth in international segment together with "solid performance" in the UK despite "relatively weak levels of consumer confidence".
The company proposed a final dividend of 4 pence per share, giving full year dividend of 6 pence per share, unchanged from last year.
Bakkavor said in the UK, against difficult market conditions, it has "successfully protected" earning before interest, tax, depreciation and amortization margins and held its underlying profitability.
Meanwhile in international businesses, the coronavirus outbreak is having a significant impact in China, the company added.
"The ongoing uncertainty regarding the extent and duration of the coronavirus crisis will clearly have a material impact on group's international performance this year, " the company warned, but remained hopeful that production levels will restore as soon as market dynamics normalises.
Agust Gudmundsson, chief executive officer, said: "This was another solid year for Bakkavor, in which we delivered further growth, increased market share, and strengthened our operations both in the UK and internationally, whilst reporting performance in line with expectations."
Bakkavor shares were trading 5.9% lower in London at 117.20 pence each on Thursday.
By Loreta Juodagalvyte; [email protected]
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