Profits fall for 2 Sisters owner
The parent company of 2 Sisters Food Group saw pre-tax profits slump by £9.9 million in its latest quarter of trading.
They were down from £12.3 million a year before to £2.4m in the 13 weeks to January 27 for Boparan Holdings.
The Birmingham-based food manufacturing business had a two per cent rise in sales for the period to £849.7m with like-for-like sales in its protein division up 3.1 per cent to £569.6m. Its chilled division saw like-for-like sales reduce from £175.7m to £171.6m.
It is currently consulting over the potential closure of three UK chicken processing sites, including those in Wolverhampton and Smethwick, as it aims to consolidate poultry operations around modern specialist manufacturing sites.
The business has also been under fire after an undercover report that claimed slaughter dates were being changed to extend the shelf-life of meat at its West Bromwich plant and poultry was being put back on the production line after being dropped on the floor.
Last month it was announced that after 25 years, Ranjit Boparan, the co-founder, owner and chief executive was to step up into the role of president, but will continue to oversee the strategic direction of the company, with a focus on reducing debt, supporting development of a world-class leadership team and continuing the drive towards the creation of a better, more transparent and simpler business.
Mr Boparan said: "During the second quarter we have delivered a solid top line revenue performance, but our near term profitability has been impacted by the major challenges we have faced during the period. We are focused on the basics, and the investments we are making provide a clear springboard to drive through meaningful and lasting change across the business.
"Despite the recent challenges in our UK poultry operations, our change programme is building on firm foundations, with strong core businesses; over 22,000 hard-working and dedicated employees and strong, long standing customer relationships. We will be working with renewed vigour with our customers and through our people to deliver what has always been at the heart of our business - delivering great quality food at competitive prices for our customers.
Martyn Fletcher, the chief operating officer, added: “In everything we do there is a relentless focus on delivering great quality, service and value to our customers. We have a clear and comprehensive improvement plan in place and are making good progress so far. There is more to do, but already we are seeing the impact of lots of small, but important changes we’re making at our production sites and across the company. We are determined to achieve the highest quality products,standards and best in class service our customers rely on.”
The agreed sale of Goodfella’s Pizza for £200m will strengthen the company's balance sheet.
Around 500 workers at the two Black Country factories, which are earmarked for closure along with a third in Scotland, face losing their jobs.
2 Sisters says the sites at Gallus House, Lincoln Street, Wolverhampton (site E), which employs 150 and Bevan Way, Alpha Business Park, Smethwick (site C), where 350 work, are ageing and unsustainable.
Staff at the Wolverhampton and Smethwick sites – the oldest cutting and packing factories in the food group – are being offered the opportunity to move to the West Bromwich site at Howard Street Industrial Estate, Hill Top, where it is consulting about moving to a seven-day operation and investing to potentially create 400 new jobs.