Top Story
Fresh to Store, trading as Kerryfresh, has collapsed into administration after running into cashflow difficulties and failing to find a saviour.
Allan Graham and Ben Wiles, of Duff & Phelps, were appointed joint administrators on Friday.
Kerryfresh, one of the leading suppliers of chilled and fresh foods to the convenience sector, with a national fleet of chilled vans, had only recently been appealing to former employees of collapsed wholesale business Palmer & Harvey to apply for jobs with it.
No one was answering the phones at the head office in Swindon, Wiltshire, on Monday. A recorded message said: “We are working extremely hard to return to normal supply and we thank you for your patience and apologise for any inconvenience this may be causing.”
The Swindon-based business traded from 19 sales centres and a distribution centre in Manchester, providing a national delivery network supplying chilled products - mainly sandwiches, savoury pastry and snacks - to the convenience sector.
The company had more than 200 refrigerated vehicles and 300 employees.
“The business had been in turnaround since it was acquired by way of a management buy-out in 2015, but was impacted by the failure of Palmer & Harvey, when that business went into administration in November last year,” said joint administrator Allan Graham.
The cash-flow pressure resulting from the delay in the settlement of a trade credit insurance claim relating to the P&H collapse was then exacerbated further in February of this year, when the company was left with no option but to exit its supply agreement with its largest customer, because of the withdrawal of insurance cover on that customer.
“The ongoing financial pressures it was facing alongside the loss of these customers meant that it had a significant funding requirement,” said Graham. “The company’s management team have been trying to secure additional investment into the business or find a purchaser for the company in recent weeks but, unfortunately, both strategies proved unsuccessful and insolvency became unavoidable at the end of last week.”
The immediate short-term strategy was to exhaust all remaining options as quickly as possible in respect of potential buyers that may seek to re-start the business, whether that is for the whole business or in parts, he added.
“This will hopefully allow us to source continuing employment for the company’s workforce, minimise the disruption caused to customers, secure new tenants for the company’s sales depots and maximise asset realisations for creditors,” said Graham.
Retailers had voiced their frustration on Twitter. One tweeted: ‘Kerryfresh trying to make contact with you guys trying phone you and I’m just getting the answer phone please help’.
Another wrote: ‘P&H going bust, rumours Kerryfresh going into admin as well the future of retailing especially local convenience stores like myself are not looking good, like the US it could be the end of the cornershop.’
The business’s strategic report for the year to the end of December 2016, signed off on 21 December last year, showed that while overall sales were 25% higher than in 2015 at £105.6m, it returned a pre-tax loss of £7.7m.
Morning Update
Irn-Bru producer AG Barr (BAG) has posted full-year pre-tax profit before exceptionals up 4.2% from £43.1m to £44.9m on revenue 8% higher at £277.7m from £257.1m.
The company reported strong core brand trading and it said continued successful innovation accelerated growth across its soft drinks portfolio, significantly outperforming the market.
It said it had completed a new long-term strategic partnership deal with Bundaberg Brewed Drinks, effective from next month, as well as a previously disclosed arrangement with San Benedetto.
Roger White, chief executive, said: “Over the past 12 months we have delivered consistent broad-based sales growth across our portfolio, well ahead of the soft drinks market performance throughout the year, supported by successful innovation, strong core brands and further development of our partnerships.”
The UK economic landscape was expected to remain uncertain for business as a whole, with regulation, changing customer dynamics and consumer preferences adding further volatility for the soft drinks industry.
“We have a strong and flexible business model and a growing portfolio of brands, both established and nascent, which reflect the requirements of today’s changing consumers. We remain confident in our ability to capitalise on the opportunities to grow our business and deliver long-term value to shareholders,” he said.
John Nicholson, chairman, said all the core brands were in growth and the new products launched last year had gained momentum, contributing to market share gains across the company’s UK markets.
The business had extended an innovation and reformulation programme and exceeded its original commitment on sugar reduction, Nicholson said.
“These actions have been taken in advance of the implementation of the soft drinks industry levy in April this year. The effort required across the whole business to deliver this commitment should not be underestimated and is testament to both the skill and commitment of our people, as well as the agility and effectiveness of our business model.”
Diageo (DGE) has appointed Ursula Burns interim executive chairman. The appointment means the position she was to have taken on 2 April as non-executive director will be delayed.
On the markets this morning the FTSE 100 climbed 1.5% to 6,990pts in early trading
Lots of early climbers were in evidence following yesterday’s depressing market dynamics. Unilever (ULVR) rose 0.7% in early trading to 3,720p, Imperial Brands (IMB) 1.3% to 2,354p, B&M European (BME) 1.1% to 400.8p and Greggs (GRG) 1,1% to 1,214p.
Fallers included Dairy Crest (DCG), down 2.1% at 479.8p, McBride (MCB), off 0.7% at 162.2p, PayPoint (PAY), down 0.5% at 801.3p and Patisserie Holdings (CAKE), off 0.5% at 355.5p.
Yesterday in the City
The FTSE 100 closed down 0.5% at 6,888.7pts.
Apart from the news about Fresh Store, which broke late afternoon, it was a fairly uneventful day.
Fever-Tree (FEVR) posted its 2017 annual report and financial statements for the year ended 31 December. Adjusted EBITDA climbed 64% to £58.7m on revenue up 66% at £170.2m.
CEO Tim Warrilow said: “Fever-Tree’s commitment to putting the best quality ingredients and choice back into the mixer category has broad appeal and is attracting consumers of all ages to this category as never before in the UK and cross the globe.”
The Office for National Statistics published new figures on workplace pensions, taken from the Annual Survey of Hours and Earnings.
The data revealed that 22-29-year-olds had the largest growth in pension membership from 65% in 2016 to 73% in 2017.
In 2017, full-time employees in both the public and private sectors had almost equal proportions of workplace pension scheme membership for men and women – 92% in public sector and 78% in private sector.
Market fallers included Real Good Food (RGD), off 1.8% at 16p, Stock Spirits Group (STCK), down 4.7% at 231.5p, Smurfit Kappa Group (SKG), down 3.92% at 2,938p in the wake of this morning’s rejection of International Paper’s (NYSE: IP) revised offer, and ABF (ABF) down 2.3% at 2,389p.
Climbers were few and far between but included McColl’s (MCLS) which rose 4.5% at 230p, Hilton Food Group (HFG), up 0.5% ahead of Wednesday’s full-year results, MP Evans Group (MPE), up 0.6% at 738p and McBride (MCB) up 1.7% at 163.4p.
No comments yet