Real Good Food executive chairman Pieter Totté will insist that the company's trading remains “in-line” with expectations, despite sales continuing to trend lower, when he addresses the company's AGM this morning (23 September).
Totté plans to tell shareholders that “overall” management is “satisfied” with trading seen so far in the first quarter. “Pleasingly, our cake decorating businesses continue to perform well, showing good EBITDA growth with our most recent acquisition, Rainbow Dust, making a healthy contribution,” he will say.
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However, Totté acknowledged that total group revenue is currently down year-on-year – following lower full-year sales in the previous fiscal. Last month, Real Good Food reported full-year sales of GBP104.5m (US$160.3m), down from GBP110.2m in 2013.
“This is entirely attributable to continued commodity price deflation, particularly in both the dairy and sugar markets, which affected our Garretts Ingredients subsidiary. Despite this, the three pillar business strategy we announced at the time of our year end results is working well and overall trading for the group is currently in line with market expectations.”
Shore Capital analyst Phil Carroll was upbeat on Real Good Food's strategy. "We believe RGF is now a transformed business with greater focus and a more added value proposition and with a good start to FY2016F, it suggests brighter times are ahead for group," he wrote in an investor note.
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