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Bakkavor Group PLC hailed a ‘strong’ performance in the first quarter of 2024, with revenue improving on a reported and like-for-like basis, while raising guidance for annual operating profit. In the 13 weeks that ended March 30, the London-based fresh prepared food manufacturer said revenue rose 2.3% to £541.3 million from a year earlier, and was up 3.2% to £543.3 million on a like-for-like basis. UK revenue rose 4.1% to £458.4 million on both a reported and like-for-like basis, which Bakkavor said was due to strengthening volumes in the quarter, supported by ‘improving consumer confidence, successful innovation, and excellent service’. Meanwhile, US reported revenue fell 9.8% to £55.2 million, while like-for-like revenue fell 5.8% to £57.7 million. Bakkavor said this was in line with expectations, ‘given the region’s focus on accelerating profit improvement’. China reported revenue declined 0.4% to £27.7 million, but rose 9.8% to £27.2 million on a like-for-like basis. ‘With the impact of Covid now annualised, LFL growth returns to more normalised levels,’ the company said. Chief Executive Officer Mike Edwards commented: ‘Last year we executed a dynamic plan to reset the business and I am delighted that the momentum this has created across the group has underpinned our strong [first quarter] performance. All three regions are making excellent progress against the group’s strategic priorities of rebuilding margins and reducing leverage and, as a result, we are confident in delivering our increased guidance for 2024.’ Looking ahead, Bakkavor upgraded its guidance for 2024 adjusted operating profit to a new range of £103 million to £108 million. It previously guided for annual adjusted operating profit to be in excess of £100 million, up from a reported £94.3 million in 2023. Bakkavor said its confidence in delivering ahead of current market expectations is based on: ‘further synergies and efficiencies in the UK following successful implementation of our 2023 plan, with inflation moderating and price recovery secured; accelerating profit improvement in the US; and stability in China, which continues to be cash generative and self-funding.’ Bakkavor added it continues to focus on reducing debt and improving leverage. At December 30, operational net debt stood at £229.6 million, down 19% from £284.9 million a year earlier. Shares in Bakkavor were up 1.3% to 134.76 pence each in London on Thursday late morning. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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