The latest results unveiled by Boparan Holdings, parent company of 2 Sisters Food Group, show that “major challenges” during the period had an impact but action is being taken.
The company’s consolidated results for the 13 weeks ended 27th January 2018 reveal some revenue generation with total sales up 2.0% to £849.7m and like-for-like sales up 1.5%.
The company achieved a net working capital inflow of £33.5m (Q2 2016/17: £9.8m) and states it continues to focus on making further sustainable inroads in this area. It is also said to be managing capital expenditure tightly and the agreed sale of Goodfella’s Pizza for £200m should strengthen the balance sheet.
Like-for-like sales in the protein division in Q2 were up 3.1% to £569.6m (Q2 2016/17: £552.3m). However, like-for-like operating profit was down by £13.5m; with an operating loss of (£9.0m) in the quarter (Q2 2016/17: £4.5m profit).
The company states that the year-on-year volume growth has been more than offset by the impact of the temporary ‘Site D’ production suspension, and the time delay in securing price increases with customers.
The chilled division saw like-for-like sales reduce to £171.6m (Q2 2016/17: £175.7m) however operating profit rose by £1.3m to £7.1m (Q2 2016/17: £5.8m).
The branded division reported broadly flat Q2 like-for-like sales to £108.5m (Q2 2016/17: £109.1m), but like-for-like operating profit reduced to £7.6m (Q2 2016/17: £9.4m). In frozen, commodity inflation in the quarter was not fully mitigated.
The company has also stated that a consultation is underway regarding the potential closure of three UK poultry sites as it seeks to consolidate its poultry operations around specialist manufacturing sites.
Ranjit Singh, president of Boparan Holdings Limited, said: “During the second quarter we have delivered a solid top line revenue performance, but our near term profitability has been impacted by the major challenges we have faced during the period. We are focused on the basics, and the investments we are making provide a clear springboard to drive through meaningful and lasting change across the business.
“Despite the recent challenges in our UK poultry operations, our change programme is building on firm foundations, with strong core businesses; over 22,000 hard-working and dedicated employees and strong, long standing customer relationships. We will be working with renewed vigour with our customers and through our people to deliver what has always been at the heart of our business – delivering great quality food at competitive prices for our customers.”
