Bakkavor Group outperforms & makes strategic progress for year

Bakkavor Group plc, the leading international provider of fresh prepared food (FPF), today announces its full year audited results for the 52-week period ended 25 December 2021.

Financial outperformance & strengthened balance sheet
• Like-for-like revenue ahead of pre-pandemic levels, up 1.2% on 2019, and up 6.2% on 2020 to £1,885.6m
• Group reported revenue up 4.4% to £1,871.6m
• Adjusted operating profit of £102m, ahead of market expectations and up 22%
• Basic earnings per share of 9.8 pence, up 3.9 pence
• Free cash flow of £91.2m, up £51.1m
• Leverage of 1.9x within medium-term target range, delivered 6 months ahead of previous guidance.

Good strategic progress underpins future growth & improving returns
• The scale, experience, category leadership and breadth of portfolio in the UK has underpinned our significant progress, and puts us in a strong position to continue to succeed
• US like-for-like revenue up 31.8% and recent investments unlock capacity for further growth
• Steady top-line recovery in China, and our strategic focus on entering new channels is being realised with new customers
• Group adjusted operating margin up 70 bps despite inflationary headwinds and labour challenges, as a result of our strict focus on cost control and operational efficiency
• Group net carbon emissions reduced by 4.1%, with 'roadmap' to deliver our 2040 net zero commitment in progress.

Remain well-positioned to successfully mitigate inflationary headwinds
• Sales volumes in early 2022 have been encouraging, giving confidence in the continuation of the group's revenue momentum through the year
• Bakkavor is committed to mitigating the impact of significant inflationary headwinds through continued price recovery with customers, strict cost control and productivity improvements
• The group is confident in delivering 2022 in line with market expectations1 as our established teams, commercial philosophy and dynamic ways of working equip us well for successfully navigating the tough environment
• Strong cash generation and strengthened balance sheet provides flexibility for targeted investment to deliver further efficiencies and take advantage of medium-term growth opportunities.

CEO Agust Gudmundsson commented, 'In 2021 we achieved meaningful financial and strategic progress against unprecedented industry challenges. We have continued to leverage our scale, category leadership, and strict focus on efficiency and cost control to emerge in a position of strength.

' Our outperformance, and the support we have given to our customers, suppliers and communities, would not have been possible without the exceptional efforts of all of our colleagues, for which I am incredibly proud.

'While we expect the significant inflationary pressures to persist, we have demonstrated our ability over the past 36 years to navigate such headwinds. I believe we are well-positioned to mitigate these challenges, giving us confidence in delivering on our expectations for the full year.'