Goodman Fielder’s strategy to restore sustainable earnings growth by refocusing its business and achieving $100 million in annualised savings by 2015 remains on track, Managing Director, Chris Delaney said.
Addressing shareholders at the company’s Annual General Meeting in Sydney, Mr Delaney said he was pleased with the company’s progress in targeting operational efficiencies to enable the company to refocus its investment in its core categories.
“Our identified cost savings through Project Renaissance are proceeding as planned and we are also well advanced on key internal projects to improve our operational effectiveness,” he said.
“I am also pleased to report continued progress in our dialogue with our key retailing partners in Australia/New Zealand. We have worked hard to deliver an improved level of alignment and engagement with our retail partners, particularly in their recognition of the costs involved in Goodman Fielder continuing to reliably supply fresh bread to destinations around Australia.”
Mr Delaney said this improved dialogue had resulted in agreed price increases being implemented across Goodman Fielder’s Bakery category to reflect a ‘cost to serve’ model which had been revised and collaboratively re-designed over the past year. In addition, Goodman Fielder had reached agreement on the recovery of higher input costs in both the Bakery and Grocery businesses.
“This is another important milestone in restoring more acceptable earnings, particularly in our Bakery business.”
Mr Delaney said the company’s priorities for this financial year included continued cost base reduction and portfolio prioritisation to enable the company to restore sustainable capital and marketing expenditure to improve reliability and quality in its core categories.
He said the company would also progress its strategy to drive further innovation across its core branded portfolio and commence work to identify new revenue streams outside of supermarket channels, including artisan bread and food service channels and by further developing its Asian capability.
“While trading conditions continue to be highly competitive, I am confident that the progress we have made in establishing a more sustainable earnings base, together with a stronger balance sheet, will mean our competitive position will continue to improve,” he said.
