Bakkavor has described its 2018 revenue growth as “robust” in the face of a challenging market.
The fresh prepared specialist reported group revenues up 2.2 per cent to £1.9 billion for 2018, with like-for-like growth of 3.2 per cent. In the UK, like-for-like sales rose by 1.8 per cent despite what the company called a “tough market”.
During the year Bakkavor opened two new US sites, completed construction of another in Shanghai and reported that the expansion of its UK desserts site was going well. It also acquired Haydens Bakery during the period.
The company’s pre-tax profit for 2018 was £77.9 million, a notable 38.9 per cent increase on the previous year’s figure.
Chief executive Agust Gudmundsson said:'We delivered a robust performance in 2018, successfully driving growth across our UK and international businesses against a backdrop of significant market challenges. This reflects our market-leading expertise in producing great-tasting fresh food, the quality of our people and our strong partnerships with customers.”
However Gudmundsson warned that subdued consumer confidence and inflationary pressures have continued into 2019, adding this was generating an atmosphere of caution, with little improvement in underlying market conditions expected. “Consequently, we expect limited growth in the UK and a corresponding decline in the group's EBITDA margin in the first half of the year,” he said.
'However, in the second half, we anticipate an uplift in UK revenues as we benefit from recently secured new business. Given this additional volume, together with the actions we are taking to protect profitability, we expect a significant improvement in our trading in the second half of the year and ourfull year groupperformanceto be broadly in line with 2018.”
