Dark Chocolate Florentines sample copy_0001

Thomas J Fudge’s Dark Chocolate Florentines

Biscuit maker Thomas J Fudge’s Remarkable Bakery slipped to a £1.5m pre-tax loss in its first year under private equity ownership.

Following the April 2016 deal that saw backer Livingbridge acquire a majority stake as part of an MBO, sales reached £12.7m in the 15 months to 1 April 2017.

This represented a 16% increase on sales of £11m in the 12 months to 30 December 2015, but the change in accounting dates meant sales declined during the 15-month financial period on a pro-rata basis.

It recorded a pre-tax loss of £1.5m compared with a profit of £844k in the previous financial year amid rising distribution costs, wages and exceptional charges.

Gross profit margin fell from 27% to 20% as it oversaw heavy promotions to fulfil its ambition of becoming the UK’s number one premium biscuits maker.

Livingbridge brought in a new management team in April 2017 led by former United Biscuits marketing director Garry Biggs to scale up the brand. The former management team behind the 2016 MBO departed in the management shakeup.

Biggs said the 15 months to April 2017 had been “a period of transition for the business”.

He explained: “Having secured a multimillion pound investment from Livingbridge in April 2016, we embarked upon a new strategic direction with a new senior leadership team while simultaneously investing in processes in order to deliver excellent service to all our customers, investing in our sales and marketing teams and upgrading our bakery.”

Livingbridge has invested £259k in plant and machinery last year to improve efficiencies, on top of the £563k invested in the previous financial year.

Biggs said branded sales were now growing “in excess of 10% year on year” driven by strong demand in core products such as florentines and its Marmite licensed range.

He added: “We enjoyed a fantastic Christmas trading period and we enter 2018 with great momentum and are excited about our growth and investment plans for the year ahead.”