Losses have deepened amid a £40m sales slump at Hovis, in a blow to the bakery’s ongoing turnaround.
Turnover at Hovis fell 8.6% to £446.8m in the 52 weeks to 28 September 2024, down from £489m in the previous 53-week financial period, the accounts revealed.
The decline in the top line, alongside higher distribution expenses and “tough trading conditions”, pushed pre-tax losses from £3.6m to £4.7m.
However, underlying profits rose again for the 52-week period, with EBITDA up £1.5m to £28.4m. It marks an improvement on losses of £6.7m in 2021/22.
“The group has achieved positive financial progress despite continued tough trading conditions,” said CEO Jon Jenkins in the Companies House accounts.
“Overall bread share remained stable, despite significant price inflation and the ongoing cost of living crisis, demonstrating the resilience of the Hovis brand and its iconic status.”
The results come as Hovis’ owner, PE firm Endless, continues talks with ABF’s Allied Bakeries over a possible merger with Kingsmill.
The deal would bring together the UK’s second and third-biggest bread brands. Hovis confirmed the discussions with “a potential third party” in its newly filed Companies House accounts.
“These discussions are ongoing, no formal sale and purchase agreement has been signed and the completion of any transaction is expected to be subject to UK regulatory processes,” it said.
Hovis and Kingsmill have both suffered as demand for white sliced bread declines in the UK. Volumes slumped 10.5% at Hovis and 22.9% at Kingsmill in 2024, according to The Grocer’s latest Britain’s Biggest Brands report.
It stands in stark contrast to category leader Warburtons, where revenues climbed 4.2% to £741.1m in the year to 28 September 2024, with volumes defying the structural challenges in the wrapped bread segment to rise 2.9%.
Hovis declined to comment on the latest accounts.
No comments yet