The firm also planned to launch a further four lines under its New York Soup Company brand following additions to its salads, dips and sauces lines and the launch of a cake range.
In France and Spain, the firm launched its Green Giant leaf salads range. It had also started to supply a number of major new international customers from its Italian pizza operation.
“Bakkavör’s focus on strengthening customer relationships and bringing the right new products, of the right quality to the market at the right time, were the keys to the firm’s growth,” said the spokesman.
Like-for-like sales
A strong UK performance helped earnings before interest rate, tax, depreciation and amortisation (EBITDA) to rise 9% to £23M. Like-for-like sales rose by 3.1%.
The UK – which accounts for the biggest proportion of European sales – saw particularly strong performances in the sales of soups and ready meals, said the spokesman.
Agust Gudmundsson, ceo, said: “We have continued to build on the momentum from the previous quarter with strong like-for like growth in sales helping to drive an additional £1.9M of adjusted EBITDA.
“Despite the challenging economic environment we have continued to strengthen relationships with our key customers and have maintained leading positions in our chosen categories.”
The adjusted EBITDA referred to the firm’s sale of Bakkavör Trateur and the closure of English Village Salads and Exotic Farm Produce.
Corporate restructuring
Gudmundsson, who founded the business with brother Lýður, reported significant progress on their proposed corporate restructuring, which he said would be concluded soon.
Bakkavör Group ehf, ultimate owner of the business, has outstanding convertible debt that is due to convert into equity in June 2014. Last month the board announced that it planned to simplify its funding structure by agreeing the early conversion of this debt.
This will be followed by a corporate re-organisation with the result that the ultimate parent of the group will become Bakkavor Holdings Limited, incorporated in the UK.
The changes would: remove uncertainty regarding the refinancing of ehf’s convertible debt in 2014 and simplify the capital structure of the group and domicile the parent company in the UK where it will be governed by English corporate regulations.
It would also “ Increase the headroom on the group’s net debt:EBITDA covenant to allow management to focus on the longer term strategy of the business,” said the statement.
