Losses show urgency of food giant’s transformation strategy

The scale of the turnaround required at 2 Sisters Food Group has been revealed after its parent group recorded fourth-quarter pre-tax losses of £53.8m.

Boparan Holdings, one of the region’s largest private businesses, has been under pressure for more than a year. An undercover investigation found serious problems inside its factories while the business faces a tough operating environment of rising costs.

Ronald Kers

Kers said there had been “a reset of the baseline of the business” which he believes provides a platform for its turnaround.

It has strengthened its cash position through disposals, including the sale of its red meat business to Goodfellas and its Manton Wood sandwiches business to Samworth Brothers.

2 Sisters has made changes to its senior management team. Kers started as chief executive in June, joining from Muller, and he has already brought over three former colleagues to boost his transformation strategy.

Kers added: “By focusing on our core with a new team, we are laying strong foundations for a more consistently performing and profitable future. I expect to see the margin improvements associated with the turnaround programme from our third quarter onwards.”

Although the group’s fourth-quarter sales showed a small increase, of 1.5%, its operating profits fell by 58%.

Its bottom-line performance was dragged further down by a loss incurred on the disposal of its red meat business and non-cash exceptional items which totalled £60m.