Boparan Holdings, the parent company of the UK’s 2 Sisters Food Group, today (26 June) reported rising sales but pressure on profits in what it described as a “tough” third quarter of its financial year.
The company booked a 4.8% increase in sales for the 13 weeks to 29 April but saw its operating profit decline by more than a third year-on-year while running up a quarterly loss of more than GBP6m (US$7.6m).
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However, Ranjit Singh, the CEO of 2 Sisters, said there were “clear signs in the top line performance that we are pursuing the right strategy to deliver sales and margin performance improvements”.
Boparan said its third-quarter sales stood at GBP821.9m. The company’s like-for-like sales, which exclude the impact of exchange rates, were up 3.1%.
The growth was driven by Boparan’s protein business, with sales from the group’s chilled products and branded divisions flat year-on-year.
Boparan posted a 36.6% drop in its third-quarter operating profit to GBP13.7m. Like-for-like operating profit stood at GBP13.1m, down 39.4% year-on-year.
The operating profit from each of Boparan’s three divisions fell. Avian influenza outbreaks weighed on the operating profit from the company’s protein arm. The end of a pizza contract contributed to a loss from Boparan’s chilled arm. The group, meanwhile, said its branded unit had been “acutely affected” by movements in currency and by commodity inflation.
Looking ahead, Boparan said: “The tough challenges experienced to date in 2017 will continue but action on price recovery, efficiency and targeted investments should pay off as we head towards the end of our financial year.
“As we move into Q4, we have begun to see the benefits of our actions against inflationary headwinds coming through and we remain confident that we can deliver for our customers on quality, service and price.”
Alongside the publication of Boparan’s third-quarter numbers, the company named former Associated British Foods executive Richard Pike as its new CFO.
