Genius Joyfull artisan loaf

Genius has repositioned itself in the functional bread market in a bid to restart growth by focusing on gut health

Genius Foods has completed a refinancing to help the gluten-free bakery invest in its factory in Scotland.

The Edinburgh-based group agreed an asset-based loan worth £7.5m with specialist financial services firm Shawbrook.

The full terms of the package include a £5m invoice financing line, a £1.5m property loan and a £1m cashflow loan over a three-year term.

Genuis struck the agreement to refinance an existing invoice finance line and raise additional funds to improve efficiency and production lines in its bakery based in Bathgate.

It follows the takeover of Genius last year by Katjes Greenfood, the investment arm of German confectionery group Katjes.

Genius CEO Peter Quinn said “Shawbrook has been incredibly supportive over the past four years, working closely with our team through last year’s acquisition and the tough economic climate.

“We are passionate about our products and this extra funding not only allows us to reinvest into our business and premises, but also to refocus on expanding our presence in the UK and Europe under the Katjes group umbrella.”

Shawbrook director David Cayzer added: “We are excited to be able to support Genius in its latest phase of growth under exciting new ownership. Genius Foods have a clear strategy to expand their customer base and provide high-quality products in the increasingly popular free-from food and wellness sectors all over the UK, Europe and beyond.”

Lucinda Bruce-Gardyne founded Genius in 2009 after her son was diagnosed with coeliac disease. Its gluten-free range is stocked by all the mults and across the foodservice channel in the UK and also has a presence in Europe and Australia.

Retail sales fell 5% to £29m last year - on top of a 9% decline in 2021 - as Warburtons grew to £30m in gluten-free sales, according to The Grocer’s annual Top Products Survey [Nielsen IQ 52 w/e 10 September 2022]

The brand has sought to reposition itself in the functional bread market in a bid to restart growth, tapping into growing consumer interest in gut health.

In 2021, it launched what it claimed as a UK first with a range of bread baked with active cultures. The five-strong range, including loaves, rolls and brioche buns, is high in fibre, vitamin and minerals, as well as remaining gluten-free.

Pinsent Masons provided legal counsel for Shawbrook during negotiations and the AAB Group conducted the financial due diligence on the deal.