Focus on core business bears fruit for 2 Sisters

Latest quarterly fiscal results from 2 Sisters Food Group show a significant improvement in overall profitability. This is attributed in part to good performance in its United Kingdom (U.K.) and European poultry businesses.

(Christian Ferrari | Freeimages.com)
(Christian Ferrari | Freeimages.com)

The latest quarterly fiscal results from 2 Sisters Food Group show a significant improvement in overall profitability. This is attributed in part to good performance in its United Kingdom (U.K.) and European poultry businesses.

2 Sisters Food Group reports overall like-for-like sales for the first quarter ended October 26 up by 0.6% year-on-year at GBP662.7 million (US$884 million). The firm says this growth was driven by its European poultry and Biscuits & Bakery businesses.

Margins were improved in all divisions, the group reports. It highlighted strong performance in its European Union (EU) poultry business, and further good progress in the turnaround in the U.K.

The modest increase in the quarter’s like-for-like sales translated into an impressive boost to profitability. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) was GBP22.5 million for the latest quarter. This represents an increase of 42% from the GBP15.8 million achieved in the corresponding period last year.

Overall EBITDA for the first quarter of this fiscal year was GBP26.3 million. This is 9.6% higher than the year-ago figure of GBP24.0 million.

Focus on core business

“Our UK Poultry operation is seeing further evidence of turnaround, our EU business is expanding for the future,” commented 2 Sisters Food Group CEO Ronald Kers. “All divisions have seen EBITDA benefits as a result of positive commercial initiatives, efficiency improvements, and overhead reductions.”

Like-for-like sales by the firm’s poultry business rose by 3.1%, while EBITDA increased by GBP1.5 million.

For the group’s other key businesses, Meals sales declined slightly but delivered an improved EBITDA, and both parameters developed positively for the Bakery business.

Over the quarter, 2 Sisters commissioned a processing plant in Poland for added-value products, while another plant — in Witham, U.K. — was finally closed.

In May of 2019, the firm announced that it planned to close the loss-making plant in Witham. Closure was expected to follow consultations with the workforce on redeployment. The move was explained as part of 2 Sisters’ strategy to focus on its core business.

Also as part of its focus on core businesses, 2 Sisters Food Group announced in October that it had sold long-established U.K. Christmas pudding manufacturer, Matthew Walker, to the Valeo Foods Group.

Part of Boparan Holdings, 2 Sisters Food Group is the largest poultry meat company in the U.K., and the eighth largest broiler company in Europe, slaughtering 323 million broilers annually, according to the latest Poultry International Top Poultry Companies database. The group also has turkey processing operations.

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