UK: Richmond reports strong full-year profits, eyes Europe
UK ice cream maker Richmond Foods has said its full-year pre-tax profit, earnings and dividends were all up by over 33% and it is now the clear market leader of the UK's take-home ice cream market.
The company said pre-tax profit was £14.0m (US$26.9m) for the 52 weeks to 26 September, compared to £10.5m a year earlier. Operating profit rose 31.9% to £16.2m, while turnover rose 12.9% to £143.6m.
During the year the take-home ice cream market, where the company makes over 75% of its sales, declined by 6.5% to £578m. In contrast, Richmond continued to increase its market share, which it said has risen over the past two years from 24.1% to 33.7% for the 52-week period ended 4 September 2004, making Richmond the market leader.
"We have increased our share of all sectors but particularly in the premium tub and individual ice cream markets. The premium tub market share gains were due to the full year effects on sales of our successful one-litre branded and own label ranges launched in the previous year. Our individual ice cream market share growth resulted from brand launches such as Yorkie and Toffee Crisp ice cream bars, and other products made at the former De Roma site in Wigan," the company said.
Looking ahead, Richmond said successful product launches in 2004, including Skinny Cow, are expected to drive organic growth in 2005.
"The task remains much the same - to continue to grow our share of the ice cream market and to sustain a high level of investment to enhance innovation and reduce costs further. The board remains confident of further progress in the coming year," said chairman Ross Warburton.
Richmond said it intends to wind down production at its Devon site during 2005, with the manufacture of products transferred to its two major sites and to its newly acquired De Roma site at Wigan.
The company said that while it believes there is still the opportunity for Richmond to continue to grow in the UK ice cream market, it has embarked on a process to evaluate potential opportunities in the ice cream market in Europe.
"This process is at an early stage and we will only invest in this area if we are confident that such a move would create shareholder value at an acceptable risk," Richmond said.
Sectors: Ice cream
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