Pilgrim’s Europe has hailed the “strong performance” that helped it return to profitable growth in its first results since merging Pilgrim’s UK, Moy Park and Pilgrim’s Food Masters into one business.
Under its new structure, the JBS-owned protein giant saw sales rise by 5.5% to £4.2 billion in the year to 31 December 2023, while profits after tax rose by 293.6% to £106m as it got “back on track” to pre-Covid levels.
Based on (albeit older) data compiled for The Grocer’s OC&C Top 150 last December, Pilgrim’s’ turnover of £4.2 billion would make it the UK’s largest food company.
The creation of the integrated business follows a major restructure, which started late last year under Pilgrim’s Europe president Ivan Siqueira, and led to – as The Grocer has reported during the course of the year – a significant cull of senior staff.
The supplier said last year’s performance had been supported by easing inflation in the UK and Europe, coupled with wage growth, while shoppers increasingly traded into chicken, pork sausages and lamb relative to other categories.
In the first half of 2024, the company said it had continued on this trajectory with profits after tax of £44m, an increase of £17m compared with the same period last year “as consumer sentiment continues to improve”.
In addition to the improving external environment, the combined performance demonstrated “the ongoing positive impact of the strategic measures implemented by the Pilgrim’s Europe executive leadership to drive greater collaboration, efficiency and growth across the businesses”, Pilgrim’s Europe said.
Back-office consolidation, coupled with footprint optimisation and an ongoing £60m strategic investment programme focused on the company’s larger facilities since the start of 2023 were also realising benefits, it added.
The investment includes £12m to consolidate and upgrade its meals facilities at Windmill Lane in London and Attleborough in Norfolk, with a focus on mix optimisation and meeting growing consumer convenience demand.
However, the business had also announced the closure of sites during this period, including Dean Way and Spurway in London.
In line with Pilgrim’s “global diversification strategy” into branded and value-added items, its £400m branded European portfolio continued to perform particularly well, the supplier said.
Net sales in this division grew over 10% in 2023 in value terms, compared to the full year 2022.
Richmond and the Rollover brand sales increased over 13% and 31% in the period with branded growth rising a further 6% in H1 2024 as Fridge Raiders and Richmond grew faster than category averages, Pilgrim’s said.
“As Pilgrim’s Europe we have come together to form the largest food business in the UK, and one of the leading integrated food businesses in Europe offering unrivalled capabilities, products, service and innovation to our customers,” said Siqueira.
“We are proud to provide local security of supply and high-quality food choices enjoyed by millions across the UK and Europe each year.”
Since the company had integrated its three main divisions “we have taken steps to drive operational excellence to become a more customer-focused, efficient organization”, Siqueira added.
“These moves have reinforced our ability to return to profitable growth in partnership with key customers. We thank all our customers, team members, farmers and partners for their support during the transition period and as we continue to identify ways to increase our speed to market, further simplify our operations and deliver best-in-class customer service and sustainable growth.”
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