Wagon Wheels manufacturer Burton’s Biscuits undertook a radical shake-up of its business after another year of declining sales, newly filed accounts revealed.

The biscuiteer changed its leadership team in August and sold off its Cadbury biscuits licence to focus on core brands following a 9% drop in annual revenues.

Accounts for the Birmingham-based biscuit maker show sales fell from £315.4m in 2014 to £287.4m in the year to 3 January 2015, with Burton’s blaming “aggressive discounter and retailer promotional activity”.

Burton’s said in its core sweet biscuit market it resisted participating in aggressive discounting to maintain market share, which led to a reduction in share of 1.3 percentage points to 7.6%. Biscuit sales volumes increased by 1.9%, but sales value was up just 0.2% due to the squeeze on price.

Sales of its “power brands”, including Cadbury, Maryland and Dodgers, slumped 10% due to lower levels of promotional activity.

Performance was better in its growing savoury business, led by Fish ‘n’ Chips, which was up 38% y-o-y and increased market share by 1.3 percentage points to 4.5%.

The top-line sales fall was also driven by exiting a number of lower-margin retail own brand and contract manufacturing agreements. As a result, pre-tax profits were up 11.3% to £14.1m, taking gross profit margin up from 24.2% to 26.5%. Adjusted EBITDA rose to £38.8m from £37.4m.

Parent company Frontier Midco returned to pre-tax profit of £913k last year after posting a loss of £8m in 2014.After year-end Burton’s signalled a strategic rethink with the August sale of its Cadbury biscuits licence to Mondelez and the departure of CEO Ben Clarke after seven years to be replaced by former CFO Nick Field.

Market sources suggested Burton’s strategic focus was in the process of being formulated as Field is “still getting his feet under the table” but strategy talks are ongoing with Burton’s owner Ontario Teachers’ Pension Plan.

Ontario had previously pledged to grow into new sectors and geographies through “synergistic bolt-on M&A”, but its 2014 pursuit of United Biscuits failed and talks in March 2016 with 2 Sisters over acquiring its Fox’s business have yet to lead to anything tangible.

It is understood one growth route Burton’s is keen to pursue is stepping up its white label business, given the growth of the retailer’s own label offerings in recent years.

Burton’s accounts also highlight its intention to grow the business internationally and “drive considerable [overseas] growth in 2016” after international sales fell 10.4% to £37.8m in 2015. A total of 13.1% of revenues were derived from non-UK locations last year, down from 13.4% in 2014. Burton’s took a £6.3m exceptional cost during the year related to its efforts to expand international operations and rationalising its existing head office and manufacturing operations.

A Burton’s spokesman said: “Through 2016 and going into 2017 we will continue to invest behind our brands, supporting our ambition to be the retailers’ first choice as manufacturer of both brand and retailer own brand biscuits and snacks.

“The recent announcement of the sale of our Cadbury biscuit licence to Mondelez International will further enable us to implement a transformational growth plan across our core brands including Maryland, Jammie Dodgers, Wagon Wheels and Fish’n’Chips whilst enhancing our retailer brand partnerships with our customers.”

Burton’s revenues peaked at £341.9m in 2011, two years before it was bought by Ontario Teachers’ Pension Plan for an estimated £350m.

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