27 August 2014


Boparan Holdings Limited, the holding company for 2 Sisters Food Group, today announces its third quarter results for the 13 weeks ended 28 April 2012.

Q3 Financial highlights

 Q3 2012PF Q3 2011% change
Group sales £603.1m £520.6m 15.8
LFL sales* £562.0m £520.6m 8.0
EBITDA** £52.7m £48.8m 8.0
LFL EBITDA margin % 9.2% 9.4% -20bps
Profit / (loss) from ordinary activities before taxation (statutory) £17.9m (£27.2m) n/a
Net cashflow from operating activities (statutory) £77.3m (£34.0m) n/a
  • Net debt*** £594.7m at 28 April 2012 as we continue to deleverage the Group; cash balances were £95.0m and £40m RCF remains undrawn

* Like for like (LFL) sales are based on the 13 weeks ended 28 April 2012 compared to Pro Forma for the prior 13 weeks ended 29 April 2011. LFL excludes the impact of discontinued operations, the acquisition of Brookes Avana which was completed on 30 December 2011 and the impact of exchange translation.
** EBITDA is pre-restructuring costs. Pro forma comparative is on the basis that the Group as it stood at 30 July 2011 was in existence for the entire period ended 30 July 2011 and after Uffculme feed mill and one off item adjustments.
*** Net debt comprises bank loans, bonds and finance leases, after offsetting cash and cash equivalents of £95.0m. 

Q3 Operational highlights

  • Continued sales progress in Q3 and full year expectations unchanged:

    • Sales momentum continues, driven by Chilled and Poultry, with a steady performance in Branded

    • Continued investment with customers to deliver sales growth and cash margin

    • New £100m Poultry supply secured with a major customer for 2012/13

    • Investment in Fox’s and Rocky brands to support NPD

Ranjit Singh, CEO of 2 Sisters Food Group, said: “We have continued our momentum in Q3, with strong sales in Chilled and Poultry helping us to deliver good like for like sales growth, slightly lower than H1 as we lapped last year’s inflation led price increases, as previously communicated. We remain focused on working closely with our customers to deliver value to the consumer, as we expect the challenging trading environment to continue as consumers see their cash squeezed.  Integration is delivering in line with our plan and as we move towards the end of our financial year, our full year expectations remain unchanged.”

Our focus on the customer saw Group like for like (LFL) sales (adjusted to exclude Brookes Avana sales) increase by 8.0% for Q3, driven by volumes, and our focus on cash margin drove EBITDA £3.9m ahead of Q3 last year. Q3 EBITDA margins, at 8.7%, edged up slightly versus pro forma full year 2011 margins (PF FY 2011 EBITDA margins: 8.2%), reflecting synergies from our integration programme. Like for like Q3 EBITDA % margin (excluding Brookes Avana) was 9.2%, broadly in line with last year’s Q3 pro forma as we focus on cash margin. Our guidance of broadly flat full year margins compared to last year’s pro forma remains unchanged.

In our divisions, Q3 sales growth continued in Poultry, with LFL sales up 8.2%, a strong performance which reflects continued investment with customers to drive volumes as we lapped last year’s selling price increases.  EBITDA margins in Poultry remained at a similar level as last year’s pro forma Q3. We gained significant new business with Sainsbury’s following an agreement to deliver an innovative Poultry solution. This additional supply business, which commences in Q2 next year, is expected to be worth approximately £100million on an annualised basis. In Europe, we continue to develop our supply offerings to the retail market, with further retail tenders secured in Q3.

Chilled saw continued volume growth, with Q3 LFL sales up 9.2%, driven by a strong performance in Ready Meals, offset slightly by Sandwiches and Salads. Our new product development programme saw the launch of new ‘British’ themed sandwich and salad products, including Hog Roast and Yorkshire Pudding wrap. Chilled EBITDA margins, excluding Brookes Avana, were broadly flat compared to pro forma Q3 last year. Our work to improve the performance of Brookes Avana and achieve break even by the year end is progressing to plan, with a marginal profit during Q3 offsetting losses during Q2. We have implemented tough actions on cost and we remain focused on securing new business and building on the quality heritage.

Q3 Branded LFL sales were up 5.5% versus last year’s pro forma Q3, reflecting an improving performance in Frozen following the Goodfella’s pizza relaunch and promotional campaign. Branded margins edged slightly down, reflecting continuing promotional activity and sales mix. In Biscuits, we continue to focus on new product development to reflect the challenging consumer environment, by working with our customers to deliver increases in own label sales. We launched Fox’s Magnificos in March, our first entry into the savoury biscuit market.  Q3 also saw initial marketing campaigns for our Fox’s and Rocky brands, including our ‘Vinnie’ TV advert and social media campaigns, with full campaigns to follow in our next financial year. In new product innovation, we launched Best of British selection and Rocky Chocka bars, reflecting our increasing focus on the snacking segment and in Goodfella’s we launched Delizia, a lighter pizza.   


Our Integration programme is progressing well as we move towards the end of our financial year. We expect synergy savings, on an annualised basis, to be at the top end of our previously communicated range of £15-£25 million.

Commodity inflation

Whilst headline inflation has edged down, input costs in the diverse basket of commodities we source remain high in historic terms. We continue to remain cautious on food commodities and do not see any material easing of commodity costs in the remainder of our financial year.

Debt funding and cashflow

We have long term funding in place, with the senior £400m 9.875% and €340m 9.75% notes due April 2018 which provide the principal funding for the Group. In addition the group has a £40m Revolving Credit Facility (to April 2016) which remains undrawn. We continue to relentlessly focus on cash and drive working capital, resulting in net cash inflow from operating activities of £77.3m before interest, tax and capital expenditure. Our net debt position and net debt: EBITDA ratio improved to 3.3 times (from 3.6 times at the end of Q2) as we deleverage the Group. Net debt at 28 April 2012 was £594.7m, with cash balances of £95.0m and the RCF remaining undrawn.

Q4 trading and Outlook

Whilst we continue to operate in a challenging and competitive trading environment, our focus on working closely with our customers has been reflected in our continued sales momentum during Q3. Q4 trading remains on plan and we expect to deliver a good sales performance over the year as a whole.


Please go to the Investor Relations section of the corporate website at for contact details.

About Boparan Holdings:

Boparan Holdings is the holding company for 2 Sisters Food Group. We are a leading diversified food manufacturer with strong market positions in Poultry, Chilled, Bakery and Frozen categories. We focus on delivering the highest quality products to our customers at the lowest cost.

Next update: Our Full year 2012 announcement will be made on 30 October 2012.