FDBusiness.com

String of Acquisitions Makes Boparan the UK’s Largest Grocery Supplier

 Breaking News
  • Discovery, Plant-Based and Alternatives Lead the Top Ten Trends For 2019 Targeting increasingly adventurous consumers, set on new discoveries and experiences, will be key to developments in the food and beverage industry in 2019. The connected world has led consumers of all ages to become more knowledgeable of other cultures, contributing to 35 percent growth of “discovery” claims, when comparing 2017 and 2016 new product launch [...]...
  • Pearse Lyons Brewery to Open New Facility at Historic Irish Site Alltech Beverage Division Ireland (ABDI) has made an announcement about the planned opening of a new brewery at the historic site of the old MacArdle Moore Brewery in Dundalk. The new Pearse Lyons Brewery will incorporate the relocation of the Station Works Brewery in Newry, which was acquired by the late Dr. Pearse Lyons in [...]...
  • WRAP Comes Up With Winning Formula to Tackle Milk Waste A new report from the UK’s leading sustainability experts WRAP shows for the first time the scale of milk wastes across the food chain, from processing to our homes, and highlights ways we can significantly reduce the 330,000 tonnes of total milk lost each year, worth more than £150 million. Milk waste in the home is [...]...
  • Samworth Brothers Launches New Fitness-focused Ready Meal Range With Innovative Identity by Brandon Leading British food manufacturer Samworth Brothers is launching a ground-breaking range of ready meals to appeal to everyday athletes, with brand identity and packaging by design consultancy Brandon. Responding to an increasing consumer demand for healthier convenience options, the meals, which come in three variants – Cajun Chicken, Turmeric Chicken and Pad Thai Chicken – are [...]...
  • Premier Foods Shows Resilience Premier Foods has reported a 1.3% increase in group revenue to £358.0 million and a 6.2% rise in trading profit to £51.0 million for the 26 weeks ended 29 September 2018. The group’s largest brand, Mr Kipling, was key to this growth following an excellent consumer response to its relaunch in the UK with revenues [...]...

String of Acquisitions Makes Boparan the UK’s Largest Grocery Supplier

String of Acquisitions Makes Boparan the UK’s Largest Grocery Supplier
September 24
10:49 2015

Boparan has seized the top spot in OC&C’s Food & Drink 150 rankings, becoming the biggest food and drink producer in the UK. A string of acquisitions – including household names like Goodfella’s Pizza, Fox’s Biscuits and Matthew Walker Christmas Puddings – has helped the company to quadruple its revenue in five years.

Now in its 27th year, OC&C’s Food & Drink 150, in collaboration with the Grocer, is the only sector-wide analysis of the financial statements of the top food and soft drinks firms in the UK, ranking companies by revenue.

Between 2010 and 2014, Boparan climbed from 20th place to number one in OC&C’s rankings, with revenue increasing from £838 million to £3.36 billion in the same time period. In 2014, the company grew its protein business by 30 per cent year on year. As a result of Boparan’s meteoric rise, after five years as the UK’s largest grocery supplier, Associated British Foods’ grocery division has been pushed into second place, despite aggressive cost-cutting helping the company to achieve a 30 per cent increase in operating profit.

Boparan’s stellar performance has enabled the company to buck the trend of an otherwise depressed sector, where intense competition among the grocers has had a knock-on effect on producers’ revenues. The average rate of revenue growth slumped from 5.8 per cent in 2014 to just 2.9 per cent this year.

Will Hayllar, Partner at OC&C Strategy Consultants.

Will Hayllar, Partner at OC&C Strategy Consultants.

Will Hayllar, Partner at OC&C Strategy Consultants and author of the report, says: “Changing shopping habits, supermarket price wars, and the continual rise of discounters’ share of the market in the UK have pushed grocery suppliers’ revenue growth to historic lows and squeezed margins ever tighter. However, there is cause for some optimism. Producers are now tackling these challenges head on by investing heavily in efficiencies and innovation, and we’re seeing M&A activity ramping up right across the sector, reflecting greater investor confidence and an appetite for growth among players.”

The first half of 2015 saw six deals in the food and drinks industry worth a total of £3.1 billion, compared to ten deals worth £2.8 billion across the whole of 2014.

This trend is particularly evident among own label producers which are benefiting from the supermarkets’ desire to differentiate in an extremely competitive grocery environment. Own label producers continue to consolidate, with revenue growing at an average rate of 5.9 per cent, in comparison to 0.4 per cent for branded players.

Across the sector, companies have been investing in efficiency and innovation to tackle changes in consumer demand, resulting in an 18 per cent year on year increase in capital expenditure (CapEx). Haribo, Frank Roberts, and Dairy Crest lead the pack, spending 20 per cent, 12 per cent and 6.3 per cent of their revenues on CapEx respectively.

OC&CLogoWill Hayllar continues: “The biggest success stories in this year’s Food & Drink 150 have ambitions far beyond aggressive cost-cutting. McCain, for example, launched six new products over the course of 2014 to meet changing consumer tastes. Equally, Alpro hasn’t rested on its laurels – innovating on its core offering with new tastes and pack sizes, and expanding into adjacent categories such as yoghurt and cream delivered a step change in the company’s performance over the past year. By meeting changes in customer demand head on, McCain and Alpro have delivered revenue growth of twice and six times the industry average respectively. Producers can take their cue from these success stories: relentless innovation, investment in your core and international growth are crucial for sustainable long-term revenue growth.”

This year’s report identifies five companies that have pursued winning strategies in a challenging marketplace:

* Moy Park has been buoyed ahead of its sale to JBS by 10.5 per cent revenue growth in 2014. Organic growth across its core UK and Irish markets, tight cost controls to drive profitability and targeted investment in its proposition delivered a turnover of £1.2 billion.

* McCain’s innovation pipeline is giving the company reasons to be chipper. The company launched six new products in 2014 helping to deliver 6.8 per cent revenue growth at an impressive 12% margin.

* Ferrero’s sweet deal with Thornton’s and significant investments in brand marketing have delivered on the company’s aggressive revenue growth plans – turnover grew by more than a fifth to £260 million in 2014, even before accounting for the growth from the Thornton’s deal.

* Alpro’s non-dairy offer and range innovation has allowed it to milk shifts in consumer preferences: 19.5 per cent revenue growth over the year pushed the company up eight places in the rankings to number 131.

* Adelie’s laser-like focus on the food-to-go customer to deliver best-in-class process, packaging and product has paid dividends for the producer – turnover grew by 19.1 per cent to £256 million.

About Author

mike

mike

Related Articles



Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • November 21, 2018expoSE European Asparagus and Strawberry Fair
  • November 27, 2018Health Ingredients Europe
  • November 28, 2018FOOD & LIFE
  • December 3, 2018P&P 2018
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber





Subscribe Here



Advertisements