28th Jun 2007 07:02
Finsbury Food Group PLC28 June 2007 Date: 28th June 2006On behalf of: Finsbury Food Group plc ("Finsbury" or "the Group ")Embargoed until: 0700hrs Finsbury Food Group plcTrading Update Finsbury Food Group Plc (AIM: FIF), a leading manufacturer of premium andcelebration cakes, low fat slices and speciality, organic and gluten freebreads, is today hosting a site visit for analysts to the facilities used byLightbody Group Ltd ("Lightbody"), which was acquired by the Group in February2007. During the visit, the attendees will be updated on the recent tradingperformance of the Group. The Board is pleased to report that trading has remained strong in allsubsidiaries, with excellent growth in sales linked in with good operationalefficiency. Sales for Memory Lane Cakes have grown by 10% year-on-year, withNicholas and Harris up 17%. In addition, the turnover of the Scottish cakebusinesses of California Cakes and Campbells Cakes are up a combined 28% for the32 weeks to June 2007. Furthermore, the performance of Lightbody has been ahead of expectations.Trading for the four months under the Group's ownership has been buoyant withsales of "bite-products" and the Thornton's branded cake range beingparticularly positive. In line with the terms of the acquisition agreement, andas a result of the excellent performance, the maximum deferred considerationpayment of £8.70m will be paid to the vendors. The post-acquisition integration has been progressing to plan with the initialsigns remaining positive at this stage. • The bakery area in Lightbody allocated to receive California has beenfitted out in line with budget and the transfer of this business will nowcommence in July. • The commercial structure has been aligned to offer our customers onecentral point of contact across the Group's cake operations. In addition, we seegood opportunities for cross-selling in the coming months. • The purchasing rationalisation is also proceeding to plan. Buying termshave been aligned and growth incentives are now in place with all majorsuppliers. • The Group is on course to generate the targeted £2m synergy savings, withthe full year effect coming through in the year to June 2009. At United Central Bakeries Ltd ("UCB"), which was severely damaged by fire inOctober 2006, we are now close to returning to full production. Commissioningtrials have been on-going throughout June on the new equipment for themanufacture of potato scones and yum yums. These will continue for some time,though the bakery will commence production for sale in early July on its fullproduct range. This is an excellent recovery less than nine months after thefire. Building works to complete the destroyed third bay will continue until theautumn, creating over 20,000 square feet of spare bakery capacity. The Board is pleased with the acquisition integration progress made to date, andalso the continued strong organic growth within the Group. There are a number ofcommodity price pressures coming through, although some selling price increaseshave been negotiated to help off-set these. The Group will continue to work withcustomers to deliver further increases where possible, and refresh the productportfolio using its innovation skills where this is not practicable. With the Group's leading position in the growing premium sectors of the bakerymarket, the Board is confident that it is well placed to continue to grow bothorganically, and via acquisition should suitable opportunities arise. Commenting, Chief Executive Dave Brooks, said: "Bringing the Finsbury Group together with Lightbody in February was atransformational move. The first four months have shown a real willingness fromthe businesses to work together and an appetite from our customers for combiningthe wider offering that the Group can now provide into complete categorysolutions. Our core markets are all experiencing growth and I am excited aboutthe ideas and opportunities that are being generated. "We still have a lot of work to do in completing the integration, and also ingetting UCB back up to full operational efficiency. These projects have startedwell and I am happy that we have a strong team in place able to deliver thesewhilst still growing the business." - ENDS - For further information: Finsbury Food Group Plc www.finsburyfoods.co.ukDave Brooks (Chief Executive) 07831 787 382Lisa Morgan (Group Finance Director) 07771 712 720 Redleaf CommunicationsEmma Kane/Sanna Lehtinen 020 7822 0200 • Publication quality photographs are available via Redleaf Communications on the numbers shown above This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
FIF.L