Demand for fancy bread fuelled growth at baker Finsbury Food (FIF) last year - that helped push the underlying pre-tax profit up 19 per cent to £5.5m.
Breads division sales grew 17 per cent, despite a flat UK market, as loaves of Vogel's, Cranks and Village Bakery flew off the shelves. The cake business faced tougher trading, though, and was hit by weak consumer spending. Still, Finsbury's Thorntons cake range had a bumper year, with revenue up 20 per cent, while other licensed brands did well, too. Chief executive John Duffy says the results mirror a trend whereby penny-pinching consumers are willing to splash out on high-quality food.
This left UK sales unchanged, while the slight drop in group revenue reflects a negative currency impact from the overseas business. Meanwhile, armed with cash from a £3.8m share placing and the £21m sale of its Free From business, Finsbury slashed debt by 73 per cent. It's also increasing bread production by 60 per cent and plans to upgrade manufacturing facilities, with £6m set aside to boost efficiency at the underinvested cake division, which generate 73 per cent of group turnover. Mr Duffy said there will "almost certainly" be a small bolt-on acquisition this year.
Broker Cenkos expects adjusted pre-tax profit of £6.3m in 2014, giving EPS of 6.8p (from 6.5p for 2013).
| FINSBURY FOOD (FIF) | ||||
|---|---|---|---|---|
| ORD PRICE: | 72p | MARKET VALUE: | £47m | |
| TOUCH: | 71p-73p | 12-MONTH HIGH: | 78p | LOW: 34p |
| DIVIDEND YIELD: | 1% | PE RATIO: | 6 | |
| NET ASSET VALUE: | 90p* | NET DEBT: | 12% | |
| Year to 29 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 179 | 1.78 | 2.30 | nil |
| 2010 | 168 | 4.87 | 5.70 | nil |
| 2011 | 190 | 5.95 | 7.60 | nil |
| 2012 | 179 | 4.59 | 8.00 | nil |
| 2013 | 177 | 6.65 | 13.0 | 0.75 |
| % change | -1 | +45 | +63 | - |
Ex-div: 20 Nov Payment: 11 Dec *Includes intangible assets of £53m, or 81p a share | ||||
