Bakkavor delivers 'robust' H1 performance

(Sharecast News) - Food manufacturer Bakkavor said on Wednesday that it had delivered a "robust" first-half performance and stated its full-year outlook was in line with current expectations. Bakkavor said it had witnessed "strong revenue momentum", with reported revenue up 10.3% at £1.01bn and like-for-like revenues up 9.2% on a constant currency basis at £1.0bn.

However, adjusted operating profits slipped 9.5% to £42.5m as its UK operations performed broadly in line with the prior period, with revenues up 7.9% year-on-year, but the group's international performance continued to be impacted by Covid-19 restrictions and inflation. Bakkavor also stated its leverage was maintained at 1.9x within its target range.

The London-listed group reported first-half earnings per share of 4.4p, up 4.8% year-on-year, and an interim dividend per share of 2.77p, up 5% on the prior period.

Revenue momentum continued through July and August, with full-year revenue expected to be in line with the upper end of market expectations of £1.99bn to £2.08bn and the company remaining confident that it can deliver adjusted operating profits within expectations of £89.9m to £95.0m.

Chief executive Agust Gudmundsson said: "Against a backdrop of macro uncertainties and inflationary headwinds, our operational delivery has been strong and we have continued to deliver for our customers. This, once again, demonstrates the continuing resilience of the group, underpinned by the strength of our customer partnerships, supply chain management, scale and category leadership.

"We remain confident in our ability to deliver a full-year performance in line with the range of market expectations as we continue to focus on managing costs, price recovery, and driving demand in our categories. The current geo-political uncertainty, however, will result in significant levels of inflation and consumer spending headwinds persisting through 2023."

As of 1010 BST, Bakkavor shares were up 2.22% at 92.0p.

Reporting by Iain Gilbert at Sharecast.com