2 Sisters owner reports £25M profits jump

04-Nov-2016 - Last updated on 04-Nov-2016 at 12:22 GMT

2 Sisters reported 40% increase in profits

2 Sisters’ parent company Boparan Holdings reported a 40% increase in like-for-like operating profit to £25.3M in its fourth-quarter trading update, despite the uncertain market following the Brexit vote.

Owner of the company Ranjit Singh Boparan said the company’s results were “encouraging”, after posting a 2.4% sales rise to £775M. The firm’s Chilled division performed particularly well – reporting a sales increase of 7.3% – Boparan claimed.

“We are pleased to report another encouraging performance with continuing improvements in sales and operating profit,” he said.

“The market remains tough with the uncertainties around the UK’s decision to leave the EU, currency-driven inflation and the volatile grocery market still applying great pressures on the food manufacturing sector.

‘A substantial £40M contract’

“Overall, the Chilled division is showing encouraging profit growth and our strategic investments here puts us in a strong position for the future.

“We continue to launch new products and win new business, including a substantial £40M contract for breaded fish and launches in traditional ready meals and soup categories, which will help to offset business which transfers to other suppliers in 2017.”

Sales in Boparan Holdings’ Protein division were also up 0.8% in the firm’s fourth quarter, compared with the same period last year. The Branded division reported a 3.2% rise in like-for-like sales to £91.1M, and operating profit increased 22.5% to £9.8M.

Despite the positive fourth-quarter report, the company’s full year results showed total sales were down 0.3% this year to £3.13bn. However, it’s like-for-like operating profits were up 57.7% to £90.2M.

‘Good progress and performances’

A Boparan Holdings statement said: “Good progress and performances across our business show that our commitment to customer partnerships, efficiency, innovation and investment to drive profitable sales is continuing to pay off.

“Despite the uncertainty arising from the UK’s decision to exit the EU, continuing cost pressures and the tough grocery market, we remain well placed to continue to deliver in our new financial year.”

Meanwhile, 2 Sisters announced plans to cut 350 jobs in south Wales this week (November 2). The firm proposed to close the retail packing department at its St Merryn meat factory, claiming the “extremely difficult environment means the packing operation is no longer sustainable.”