Bear and Nakd owner Lotus Bakeries has reported a double-digit jump in first-half sales and profits amid strong growth of key brands.
The Belgian group reported consolidated sales of €599.3m in the first six months of 2024, representing a year-on-year increase of 19.6% or €98.1m.
It said this sales growth had primarily been driven by a robust and broad-based volume increase of more than 16% across geographical segments and across its three business segments.
Price increases have, combined with foreign currency impact, a limited contribution of 3% in the total revenue growth of 19.6%.
Lotus Biscoff, the group’s largest business segment, saw “outstanding” volume growth of more than 20%, boosted by its strategic focus on building penetration for Biscoff cookies and spreads and broadening partnership with global consumer goods brands.
The growth of Lotus Biscoff in the first half of the year was geographically broad-based, with strong performance in Continental Europe, the UK, the US and Asia-Pacific.
Lotus Natural Foods, which hosts UK-based brands Bear, Nakd and Kiddylicious, continued to outperform the market via a strong, double-digit growth.
International Lotus Natural Foods activities outside the UK grew again by almost 30% in the first six months of this year and account for more than one third of total Lotus Natural Foods sales.
Besides sustained good performance of Bear in the US, Nakd and Kiddylicious also realise relevant distribution gains in several European markets.
Also in the UK, Lotus Natural Foods realised sustained growth across all core concepts and was further supported by NPD, including the Nakd protein bar and Bear Fruit Splits.
Overall EBITDA of €115.8m increased by €20m and by 20.9% to “confirm the robustness of the growth strategy”.
Profitability was helped by an easing of inflationary input costs. With the exception of chocolate, the input and production costs for raw materials, packaging, co-manufacturing, utilities and labour have stabilised year over year.
It said the Biscoff and Bear factories have been capable to deliver the additional output needed to fulfil market demand contributing positive operational leverage to allow investment in marketing to sustain continued growth.
It said its outlook in the second half of the year remained positive, while recent half year’s growth rates needed to be tempered.
An increasing comparable in the second half of the year, a further phase-out of the annualised pricing impact and limitations of installed and available production lines to generate ever more incremental output warrant some caution in the forecast for the second half of 2024 and 2025, it said.
CEO Jan Boone commented: “After growing more than 20% and reaching the billion-euro sales milestone in 2023, I did not expect we would add another 20% of sales already in this first half year. The strong volume growth for Lotus Biscoff and Lotus Natural Foods underlines the continued momentum and potential of the brands.
“We are a growth company and we need to support and invest in the brands accordingly. That is also why we announced a step-up in media investments in Lotus Biscoff as one of the key activation levers of the Biscoff growth strategy. This will be a long-term and sustained investment needed to further build on our global awareness and ambition for Biscoff.”
Morning update
Revolution Bars has announced its restructuring plans has received court approval.
The plan, which was launched on 31 May 2024, will enable the company restructure liabilities, including amending and extending the group’s secured lending facilities, exiting the leases of certain loss-making sites, and implementing necessary rent reductions on certain other sites.
The board expects the plan to deliver a significant annualised EBITDA improvement of around £3.8m.
Following completion of the plan, the business will operate 27 Revolution Bars, 15 Revolución de Cuba Bars, 22 Peach Pubs and one Founders & Co site.
The plan is also supported by the raising of £12.5m.
It said trading had been affected by the uncertainty and distraction of the restructuring process.
Rob Pitcher, CEO of Revolution Bars Group, said: “We are very pleased that the court has sanctioned the restructuring plan for Revolution Bars Limited. The group is now well diversified across the key brands, providing a more secure financial base and we look forward to the future with improved optimism.
“I would also like to thank the group’s wider stakeholders for their support, including our secured lender, current shareholders, our new and existing shareholders who have participated in the fundraising and all our advisors who have assisted us in the development of the plan.”
On the markets this morning, the FTSE 100 is up 0.4% to 8,177.2pts.
Risers include Just Eat Takeaway.com, up 5.4% to 1,100p, Deliveroo, up another 4.3% to 147p and Glanbia, up 2.9% to €18.34.
Fallers include Virgin Wines, down 5.6% to 42p, Nichols, down 3.9% to 1,133.5p and McBride, down 0.8% to 122p.
Yesterday in the City
The FTSE 100 fell back 0.3% to 8,145pts yesterday.
One of the day’s major winners was Deliveroo, up 10.5% to 140.9p after posting its first ever half-year profit and promising to return £150m back to shareholders.
Other risers included Nichols, up 4% to 1,180p, Ocado, up 1.8% to 397.8p, Greggs, up 1% to 3,094p, Hilton Food Group, up 0.8% to 916p, and British American Tobacco, up 0.7% to 2,803p.
The day’s fallers include Naked Wines, down 4.1% to 51p, WH Smith, down 2.7% to 1,183p, Greencore, down 1.5% to 172.6p, B&M European Value Retail, down 1.5% to 453.4p, Pets at Home, down 1.4% to 288.3p and Premier Foods, down 1.4% to 167p.
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