Ready meal firm reports strong half-year results

Ready meal group Bakkavör has revealed strong revenue performance and like-for-like (LFL) sales growth in its half-year results.

The group, which employs more than 19,000 people globally and makes over 5,500 products in 18 food categories for the big four, said LFL sales grew by 6% in the second quarter (Q2) of the year.

Revenue in the 26 weeks ending 29 June 2013 was up 4% on last year to £821.4m and the company said product innovation and “manufacturing excellence” continued to support its strong performance.

Chief executive officer for Bakkavör Agust Gudmundsson said: “We have continued to make good progress in the second quarter, with strong revenue growth, increased profits and improved cash generation.”

He also claimed that the recent completion of its refinancing in June 2013 “demonstrates support from the financial markets and reinforces the underlying strength of the business”.

Meanwhile, UK operations yielded £382.4m in revenue for Q2, which was up by 6% on last year and driven by good sales of soups, pizzas and desserts. Bakkavör has also said it has seen some recovery in ready-meal sales following the horsemeat contamination issue earlier in the year. It said: “We are continuing to work very closely with our customers to re-establish consumer confidence in this sector.”

Gudmundsson added that the company was expecting trading conditions for the rest of the year to be challenging, due to inflation and a “competitive retail environment”. However, he said: “We remain confident in our strategy and our market-leading position in the chilled convenience market.”