Real Good Food’s revenues hit by Covid-19 – but group remains optimistic

Real Good Food

A challenging year has seen revenues drop at food ingredients business, Real Good Food.

In the year to March 31, 2021, the Liverpool headquartered company reported a decreases in sales by 9.5% to £37.3m, down from £41.2m in 2020, in a year affected by covid-19.

The majority of the revenue decline was in the group’s first quarter – which coincided with the first UK lockdown – and predominantly in the wholesale and manufacturing sectors which were down by £2.5m (-9%).

International revenues were up year-on-year with Europe broadly in line, and the US with a year-on-year increase of £1.1m (+18%).

The International sector also had challenges with its export logistics including the global shortage of containers and the impact of border controls owing to Brexit.

The group said there was a declining market for sugarpaste (-8.4%), however, cake decoration sales of sugarpaste outperformed the market by 2.4% in the year.

Frostings revenues rose by 17% versus FY20, which is a growing market where its Renshaw brand is developing and selling premium products.

Retail, despite covid-19, saw revenues increase by 7% year-on-year.

Its Brighter Foods business was also sold in May 2021 for  £43m to The Hut Group.

RGF delivered an adjusted underlying EBITDA on continuing businesses of £200,000 compared to a loss of £1.6m in the prior year.

Looking ahead, the board remains focussed on reviewing the group’s structure; including the intention to delist from AIM to save costs and “provide greater agility and flexibility to maximise shareholder value.”

Mike Holt, Executive Chairman said: “Much has happened since 31 March 2020 in terms of making progress and restoring shareholder value.

“The Group has coped with the challenges of covid and has continued to improve underlying profitability.

“In addition, the debt burden was halved following the successful sale of Brighter Foods. Renshaw and Rainbow Dust Colours, our two remaining businesses, continue to improve their performance, and after a good start to the year, prospects are encouraging.”

 

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