Prepared food firm Bakkavor Group plans to mitigate the impact of changes to National Insurance in the UK budget, effective April 2025, through price recovery and efficiency improvements.
According to Bakkavor's estimates, it will cost the company around £15 million (€17.8 million) annually.
The company achieved strong revenue growth with profit ahead of market expectations for the 52 weeks to 28 December 2024, it noted in a trading update.
Like-for-like revenue increased by 5.1% while reported revenue grew by 4.0%, including the impact of currency and the China Bakery up to disposal.
Divisional Performance
In the UK, Bakkavor's growth was driven by improved volumes and some price recovery.
The company returned to growth in the second half in the US, with strong operational delivery supporting a step up in profit.
Retail and new foodservice customers drove volume growth in China during the financial year. The business remained cash-generative and self-sufficient, with improved profitability.
Strategic Progress
Bakkavor saw good strategic progress in the latest 52 weeks as it delivered on its regional priorities and focussed on efficiencies.
The group expects FY 2024 adjusted operating profit to be in line with the upper end of market expectations.
The company added that it remains focused on driving the adjusted operating profit margin to 6% in the medium term.
Mike Edwards, CEO of Bakkavor, commented, “We delivered a strong performance in 2024 as we continue rebuilding our margin and strengthening our balance sheet.
“Throughout the year we have delivered excellent quality, service and innovation for our customers, culminating in exceptional delivery of our Christmas peak.”
