Inflation easing has seen operating profit at Warburtons almost triple to reach its highest level in seven years, with strong volumes supporting a 17.4% increase in turnover.
In its annual report filed on Companies House, the Bolton-based bread giant posted revenue of £711.3m for the 53 weeks to 30 September 2023, up from £605.7m the previous year.
The company noted it had balanced the recovery of input cost inflation with strong cost management as well as offering retail customers and consumers competitive prices. It said the rise in sales resulted from volumes remaining strong during the period, driven by strategic partnerships and product introductions. Crumpet Thins and Soft Naans were among the new lines launched last year.
While elevated costs had caused Warburtons’ operating profit to plummet to £12.8m in its previous financial year, vastly improved margins had catapulted it up to £32.5m for FY23. This marked the firm’s highest operating profit since 2016, when it reported £33.5m.
Improved revenues and profits have also been reported in latest annual results by fellow bread suppliers Hovis and Allied Bakeries, which produces the Kingsmill, Allinson’s, and Sunblest brands.
During its FY23 period, Warburtons appointed Mary-Ann Kilby as its new managing director and increased its average number of employees by 46 to reach 4,952.
The ongoing war in Ukraine had also continued to have a significant impact on business, confirmed Warburtons, especially in the first half of the financial period with inflationary increases seen across key areas including wheat, energy, and fuel. The manufacturer said it was continuing to monitor these costs and ensure appropriate strategies were put into place.
Warburtons asserted that the wrapped bakery market remained ‘very competitive’ with underlying long-term declines in the core bread market continuing to be offset by growth in other wrapped bakery products. In discussing opportunities for the year ahead, Warburtons sales director Colin Bebbington identified in-demand bakery occasion products such as pittas, crumpets, and bagels as essential for the growth of the category.
As part of a three-year investment plan to meet consumer demand for ’versatile and convenient’ gluten-free bakery, new Gluten Free Soft Pittas were unveiled in April. ‘This continuing innovation and investment in new capability will ensure we are well placed for future progress’, stated Warburtons in its latest financial statement.
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