28 November, 2017
Profits slump for 2 Sisters owner
Full-year profits have slumped at the parent company of poultry giant 2 Sisters Food Group, which also makes Fox’s Biscuits and Goodfella’s pizzas.
Boparan Holdings made a pre-tax profit of £22.8m in its year to 29 July 2017, down from £63.4m the year before.
However, the company’s sales increased from £3.1bn to £3.2bn over the same period.
Sales in the fourth quarter of its financial year rose by 5.3 per cent to £815.7m.
However, profitability for the quarter was adversely affected by higher than anticipated commodity inflation not being fully offset by price increases and cost reduction efforts.
The group was also affected by several exceptional items, including financial reporting and control issues at one of its small standalone businesses, together with redundancy and disruption costs relating to a poultry site closure.
Ranjit Singh, 2 Sisters Food Group chief executive, said: “The business continues to face into an extremely tough trading environment with further increases in input costs.
“Clearly margin performance improvement is a top priority, and this will be underpinned by working hard on the action plans that make the most difference to our core business.
“Nevertheless, we remain positive about our top line growth and how that positions us with our customers.
“We continue to progress our poultry footprint changes, which delivers quality, safety and a shorter, leaner, more transparent supply chain.
“We are investing in our people and our sites, with a view to optimising available capacity. Our meals division has benefitted from rationalisation and investment which will also provide a springboard for further growth.
“However, as with our branded businesses, cost inflation has negatively affected margins, and our teams are taking ongoing actions to redress the balance.
“Whilst this will not happen overnight, our management team are focused on delivering our step change plan to enable us to continue on our journey of producing high quality and safe food.”
The results come after the 2 Sisters halted production at its main West Midlands plants following an undercover operation by the Guardian and ITV News in October. It has now been confirmed that production re-started this week. Boparan Holdings said the suspension of operations will impact its first quarter results in its new financial year.