Trading Update

RNS Number : 5378N

Real Good Food PLC

01 February 2016

 

Strictly Embargoed for 07.00: 1^st February 2016

Real Good Food plc

("the Group" or "Real Good Food")

Trading Update

Real Good Food plc (AIM:RGD) today gives the following update on trading.

The current financial year has been one of significant transition for the Group as it implements its operational strategy and investment programme across the business and reorganises its reporting structures into three pillar markets of cake decoration, food ingredients and premium bakery.

The business has invested heavily in people, product and brand across all its businesses as it executes its strategy of achieving the optimal operating platform from which to drive significant future growth.

The Board now expects that within the continuing business EBITDA will remain flat year on year, as this investment, when combined with other one-off events within the various business divisions, has led to a short term impact on margins.  As a result the Board does not expect the final profit outcome for the financial year ended 31 March 2016 to meet current market expectations.

The Board is confident however that the negative impact on margins is short-term and that the Group is well positioned for future growth following its investment programme.

During the year to date the Group has made financial progress, completing the sale of Napier Brown for a total consideration of £44.4m (the "Disposal"), which delivered an exceptional profit in the period of £9.4 million.  As a result the Board expects total Group reported PBT and EPS at the year-end to be significantly improved when compared to the previous year. In addition net borrowings for the Group will be substantially reduced following the inflow of the £44 million from the Disposal, which has enabled the Group to repay all of its PNC borrowings. 

This leaves the Group in a strong position to execute its dual investment and acquisition strategy, which is already well underway, leading to future growth and increased financial strength.

A further update will be given as the Company enters its pre-close period ahead of the announcement of preliminary results for the year ended 31 March 2016.

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About Real Good Food plc

Real Good Food plc is a diversified food business serving a number of market sectors including retail, manufacturing, wholesale, foodservice and export. The Company focuses on three main markets: cake decoration (Renshaw, Rainbow Dust Colours), food ingredients (Garrett Ingredients and R&W Scott) and premium bakery (Haydens).

ENQUIRIES:

Real Good Food plc
Pieter Totté, Executive Chairman	Tel: [phone]
David Newman, Finance Director	Tel: [phone]
Andrew Brown, Marketing Director	Tel: [phone]
Shore Capital & Corporate (Nomad and Broker)
Stephane Auton	Tel: [phone]
Patrick Castle
Belvedere Communications (PR)
John West	Tel: [phone]
Kim van Beeck

 

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