Finsbury saw “rapid change” in wake of coronavirus lockdown

Peter Baker, non-executive chairman, said the company had to act decisively and adapt quickly to continue producing food products in a way that kept its staff safe and protected the business. 

The company revealed that sales in the largest part of its business, retail, remained relatively resilient and has continued to recover month-by-month since April. It said that everyday bakery products such as rolls proved popular but demand for celebration cakes was more subdued as a result of the lockdown restricting social gatherings. 

“There are now encouraging signs that we are moving in the right direction once again, after a challenging few months,”​ he said. 

Revenue​

In its results preliminary results for the 52 weeks ended 27 June 2020 group revenue hit £306.3M, 2.8% lower than the previous year. Adjusted pre-tax profits fell 12.9% to £13.9m.

Following a first half performance, which saw group revenues grow 4.7% to £159.4m, performance in the second half was impacted by the outbreak of the Covid-19 pandemic, with sales down 9.8% to £146.9m.

The reduction in sales to the foodservice and the out of home sector, which last financial year represented 20% of sales turnover, were reported as “primary driver” behind the reduction in revenue.  

The company said despite the challenges it has remained resilient. It added that key trends of health and wellbeing, and ethical and environmental choices remain a driving force with consumers. 

During the year it has launched a number of new products including plant based, vegan friendly whole cakes and celebration cakes, launched with the BOSH! brand and has invested in its Celebration Cake bakery in Hamilton​ over the last year to turn it into a fully nut-free site. 

Unprecedented demand ​

John Duffy, chief executive of Finsbury Food Group, said: "The first three quarters of the financial year saw the group perform in line with market expectations as the benefits of our long-term investment programme and operating initiatives continued to bear fruit. The outbreak of Covid-19 saw unprecedented demand swings and resulted in a challenging period for the group, but I am proud of how we responded and were able to play a part in ensuring the UK's supermarkets had the food stocks needed at the time.'​

He added that after the initial shock of the pandemic,  the company took "decisive action" to protect the business, its people and realign its operations to the changes in demand, which resulted in a "robust performance" in the circumstances.

"We remain focused on becoming a leading speciality bakery group and, notwithstanding coronavirus-related disruption, we have continued to make good progress towards that goal. There will inevitably be further obstacles to overcome as the pandemic plays out and with Brexit approaching, but there is a sense of cautious optimism in the business, and we are confident that by continuing to manage the business in a disciplined and pragmatic way, we will emerge a stronger, more streamlined and efficient organisation capable of delivering sustainable growth and healthy returns for shareholders," ​Duffy said.  

The company revealed it  furloughed 534 staff at its peak, but at 31 August 2020 the number had been reduced to 94.