The 2019 financial year marks the end of a four-year investment plan at Finsbury Food Group (FIF), which has involved annual capital expenditure averaging £12m. This has increased capacity via a new bakery facility in Poland, and all UK sites have migrated to an updated IT platform.
Further efficiencies will be welcomed, as management cited a “challenging global environment” – operating profit margins contracted to 5.3 per cent, from 5.9 per cent, as cost inflation and a downturn in consumer sentiment took its toll. Performance was stronger in the second half, thanks to a combination of organic growth, new business wins, price increases and the acquisition of gluten-free baker Ultrapharm. The latter represents part of the group’s diversification plan, as it increases its presence in the 'free from' market. It has also branched out into foodservice, where it supplies pub and restaurant chains, fast-food outlets and contract caterers.
Analysts at Panmure Gordon forecast adjusted pre-tax profits of £18.4m in the year to June 2020, giving EPS of 9.7p, rising to £18.9m and 9.9p in FY2021.
| FINSBURY FOOD GROUP (FIF) | ||||
| ORD PRICE: | 70p | MARKET VALUE: | £91.3m | |
| TOUCH: | 69-71p | 12-MONTH HIGH: | 128p | LOW: 59p |
| DIVIDEND YIELD: | 5.0% | PE RATIO: | 10 | |
| NET ASSET VALUE: | 82p* | NET DEBT: | 32% | |
| Year to 29 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2015 | 256 | 8.5 | 5.8 | 2.5 |
| 2016 | 320 | 11.8 | 6.1 | 2.8 |
| 2017 | 314 | 13.0 | 7.1 | 3.0 |
| 2018 | 304 | 4.5 | 1.7 | 3.3 |
| 2019 | 315 | 13.6 | 7.3 | 3.5 |
| % change | +4 | - | - | +6 |
| Ex-div: | 21 Nov | |||
| Payment: | 23 Dec | |||
| *Includes intangible assets of £97.7m, or 75p a share | ||||
