Real Good Food Company Plc (The) Trading Statement (1764Z)
04 Février 2014 - 8:00AM
UK Regulatory
TIDMRGD
RNS Number : 1764Z
Real Good Food Company Plc (The)
04 February 2014
The Real Good Food Company plc (AIM: RGD)
Third Quarter Trading Update
The Real Good Food Company plc ("the group" or "RGFC") is a
diversified food group, which owns Napier Brown (Europe's biggest
non-refining sugar distributor) as well as Renshaw and R&W
Scott (bakery ingredients), Garrett Ingredients (dairy ingredients)
and Haydens Bakery (patisserie and desserts).
Third Quarter trading activity - from 1 October to 31 December
2013 - proved to be mixed in what were challenging market
conditions for the food sector. Three of our businesses (Renshaw,
R&W Scott and Haydens) recorded EBITDA growth year-on-year, but
we continued to be affected by the well-publicised dramatic
reduction in sugar market prices. We have made good progress in
addressing this with a number of new supply sources secured in the
past three months and we see sugar margins being fully restored
during the course of 2014.
The Group will provide a further update on trading in April.
Divisional Commentary
Napier Brown's sales, following this year's main contract
season, have increased significantly in both the industrial and
retail sectors. The new listings for the Whitworths brand have come
into effect and utilisation at the Normanton packing facility has
increased substantially. Commissioning of the new site at Immingham
is virtually complete and will enable the business to utilise new
sources of sugar more cost effectively which is critical to our
future business model. Trading has inevitably been impacted by the
reduction in sugar prices, but we are confident that the steps we
have taken to mitigate against this will restore margins to
previous levels during 2014.
At Garrett Ingredients trading has been also been affected by
the instability in the sugar market and while contribution from
Dairy ingredients showed growth in the early part of the year,
recent market conditions have been challenging. This and some
increased costs associated with a management re-organisation will
impact this year's performance. We are very pleased, however, to
have successfully recruited a new, experienced management team and
believe that we now have the structure in place to deliver our
growth plans.
At Renshaw, the investment in sales and marketing is now
beginning to pay dividends and we anticipate reporting a
significant increase in EBITDA for the year. Sales growth has been
experienced in UK retail while export initiatives are also showing
positive signs with our business in Brussels now fully operational
and the Renshaw brand launched in the US with a bespoke range of
products.
R&W Scott has now recruited a full commercial team and is
ready to drive a series of added value product launches over the
next 18 months. The first of these, a range of premium desert
sauces, is now on sale in retail while a number of b2b
opportunities have been identified across all product sectors.
EBITDA will be similar to last year as the business absorbs the
increase in overhead which is required to meet its long term
ambitions.
EBITDA at Haydens is anticipated to increase YOY as sales
continue to grow and the remodeling of the bakery enables improved
labour utilisation. The customer base continues to broaden and the
commercial team has been expanded to reflect this.
Pieter Totté, Executive Chairman, comments:
"The investments which we have made in increased sales and
marketing resources were designed to transform our businesses from
being manufacturing-led to market-led and underpin our growth
strategy.
"It is pleasing to see that this strategy is now beginning to
bear fruit: volumes are showing good growth in Napier, Renshaw and
at Haydens, while we have now recruited sales and marketing teams
to deliver similar momentum at R&W Scott and Garrett
Ingredients.
"The instability in the sugar market is giving us short term
challenges but our strategic plans in this market remain sound and
we are encouraged by the support being given to us by customers who
recognise the valuable role we play in the market."
4 February 2014
ENQUIRIES:
Real Good Food
Pieter Totté, Chairman Tel: 020 3056
1516
Andrew Brown, Marketing Director Tel: 020 3056
Mike McDonough, Finance Director 1516
Tel: 0151 706
8200
Shore Capital & Corporate Tel: 020 7408
4090
Stephane Auton
Patrick Castle
Cubitt Consulting Tel: 020 7367
5100
Gareth David
Cebuan Bliss
This information is provided by RNS
The company news service from the London Stock Exchange
END
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