Icelandic food group Bakkavör posted a return to profitability today (27 August) following a restructuring programme at the start of the year.
The private-label food maker saw net profit for the six-month period to 30 June reach GBP18.3m (US$29.6m) versus a loss of GBP36.3m a year ago.Operating profit, however, dropped 13.7% to GBP37.1m.
Nevertheless, net sales were up 4.2% on the previous year to GBP836.4m. Group sales in the company’s UK fresh prepared foods business accelerated, with strong sales growth of 10% in the ready meals division.
“As anticipated when we reported our first quarter results in May, Bakkavor has now returned to EBITDA growth following the successful implementation of our restructuring plan at the start of the year,” said CEO Ágúst Gudmundsson.
“Furthermore, our cash position has improved considerably reflecting greater operational efficiencies, a marked improvement in profitability and greater control of working capital.”
The company revised its EBITDA guidance for the full year to reflect its “renewed confidence”.
“We are confident our EBITDA will continue to improve throughout the remainder of the year underpinned by operational efficiencies and capacity utilisation which will continue to deliver further cash benefits to the group.
“As such we are raising the EBITDA forecast for the full year by GBP5m on the forecast made in the first quarter, to GBP130m, a 20% increase.”