Finsbury Food Group, which produces cakes, breads and morning goods for the retail and foodservice sector, has said that it plans to source more product from within the UK, in order to mitigate the impact of a potential no-deal Brexit.
The group made the announcement as it posted full-year results that showed group revenue up 4.0% on a like-for-like basis, to £315.3 million, for the year to 29 June.
Adjusted EBITDA at the group was flat at £25.5 million.
Brexit Planning
The group said that it has 'prepared a number of strategies' to mitigate the impact of Brexit, noting that as it buys some commodities from Europe, any tariffs on trade will 'have a bearing' on the group.
'We have contingency planning in place, looking at alternative UK sources of products. Higher logistics and administration costs may result from border delays and could necessitate higher stock levels,' it said.
In addition, the group is also developing labour strategies to develop its existing workforce and boost productivity through its capital investment programme; further strategies that it believes will help to mitigate the Brexit impact.
'Our diversification, agility and innovation has allowed the Group to not only adapt but also perform well in the face of the cost pressures and market volatility we have seen of late,' it added.
Acquisition Boost
During the financial year, Finsbury Food Group completed the acquisition of Ultrapharm, a specialist free-from bakery farm, which it said has 'accelerated [its] access to the high growth Free From market'.
It also invested in new capacity through the opening of a new bakery in Poland, as well as investing in an 'individually-wrapped cake bar' platform to tap into growth in the 'on the go' market.
"In what has been a continued challenging market environment, our sales growth and increased dividend demonstrates our ability to navigate more challenging times and our continued confidence in the prospects of the Group," commented John Duffy, chief executive, Finsbury Food Group. "Our achievements have been underpinned by our relentless focus on investment, efficiency and innovation, alongside our ability to harness the growth available from premium, healthy and authentic on-trend innovation."
Outlook
Finsbury Food Group said that it is confident that the 'strong second-half performance' recorded at the end of the previous financial year will carry into the year ahead, with the group having reported 'strong quarter one growth to date', it said.
It added that while the 'wider macroeconomic and political environment remains challenging in the UK', the group's focus on innovation, strong performance in foodservice and entry into the free-from market 'provides a strong footing to continue to drive organic growth'.
"We are confident that the Group is on a strong footing and able to drive further growth in the period ahead, as we continue to build a strong, lean, scale competitor and consolidator," said Duffy.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
