Graze trimmed its losses last year as it cut costs ahead of a planned integration into parent company Unilever.
Unilever decided to integrate the healthy snacks brand this year after it had made a loss in every full year since the consumer goods giants acquired the business for £150m in early 2019.
While Graze’s revenue was down 11% to £39.6m in 2023, according to its latest accounts, this was due to a strategic decision to focus on more profitable retail partners and channels, it said.
Meanwhile, the business narrowed losses to £2.6m from £5.2m the year before as its operating margin improved from -17% to -11%. Graze said this was delivered without major price hikes thanks to “driving through supply chain cost efficiency programmes”.
Marketing costs were also slashed to help cut £3m from its administrative expenses.
Unilever was asked for comment.
Graze has struggled since the pandemic when demand for on-the-go snacks was hit by numerous lockdowns. More recently, its online subscription sales have been dampened by the cost-of-living crisis.
Graze’s move inside Unilever is expected to lead to job losses among its administrative roles. Graze already slimmed down these jobs last year with the number of administrative employees falling from 111 to 92.
Former Graze boss Joanna Allen left the business in May to take over mochi ice-cream makers Little Moons. Allen took change of the brand following Unilever’s acquisition and was charged with “accelerating revenue performance,” according to her LinkedIn. Revenue was £55m in the last full year before Unilever’s acquisition.
A senior industry source told The Grocer in May that “Graze has not really delivered what has been required to justify the costs of being a standalone business within Unilever.”
They added: “I’m actually surprised they are going for the integration rather than an outright sale as the synergies with their existing business are pretty low. And it doesn’t fit with the new CEO’s strategy to focus investment on the group’s 30 power brands and simplifying the organisation around these.”
Under Schumacher, Unilever is investing more in its top 30 brands that represent more than 70% of sales as he looks to streamline a portfolio that had swollen to around 400 brands under predecessor Alan Jope.
No comments yet