Prepared foods company Uniq is to sell its French spreads and Belgian salads businesses. The sell-off is part of a recovery programme that has already included UK price increases said to be worth £10M a year to the group.
Uniq's chief executive Geoff Eaton said the group had suffered from developing too many businesses. It had also failed to keep in close enough touch with some key customers and had not moved fast enough in the market, he said.
Since joining Uniq last August, Eaton has launched a decentralisation programme and made changes to senior management.
Uniq's UK business made an £11.6M operating loss in the year to the end of March on sales down 1% at £321.8M compared with a £5.5M loss the year before.
The main problem was a £11.9M loss at Uniq's Minsterley desserts factory said the group's chairman Nigel Stapleton. "This reflects some serious shortcomings in handling this acquisition which date back to May 2004," he said.
Minsterley's problems, which included customer service, were being addressed and the factory should return to profitability and generate positive cash flow by the start of 2007, Uniq said.
It added that an eight-year distribution deal with the distributor Wincanton, which was sold by Uniq in 2001, was now unsuited to its present more decentralised structure. The deal was costing it £8M a year until 2009.
Uniq's Northern Europe division made a £100,000 operating loss last year on sales down 4% at £240.1M.
The Southern Europe division (mainly operating in France) made a £25.2M operating profit, although Uniq said that a fire last year at a Spanish sandwich business of the division was largely behind a 7% fall in sales to £252.9M.