Irish bakery McCambridge revealed it has weathered the twin storms of commodity price rises and disgruntled creditors, as it continues to turn around former troubled bakery giant Inter Link Foods.
Giving his first interview since being appointed chief executive of McCambridge in February, Gavin Cox, who joined as finance director last year, told British Baker that, nine months after acquiring Inter Link out of administration, the business was back on track.McCambridge’s pre-Inter Link turnover was around £35 million, but the acquisition has seen this figure leap five-fold, and is estimated at £175m for 2008. Now the plan is to break the £200m mark within three-to-five years.
"That’s how we see ourselves growing: through current markets; new markets, including foodservice; and by developing the business through organic growth, rather than acquisition," said Cox.
He added that, following record commodity price rises, the business was taking steps to protect itself on pricing. "We’re trying to offset [cost rises] by buying better and mitigating it internally. We have to take a view on what the commodities markets will do. But if commodities fall outside certain bands, our prices will have to change."
Action has been taken to overhaul logistics, replacing the central distribution system that caused problems for Inter Link, in January this year. Meanwhile, a new management team has been working to appease the 1,640-strong list of creditors, after Inter Link built up debts of £63m.
Chief operating officer Martin Davey said: "What tends to happen, when you buy a firm out of administration, is that you’ve got a not-very-happy supply base. Now, everybody is back on credit terms. We’ve widened our supply base, and we’re looking harder at keeping costs down."
l See the next issue of British Baker for a full interview.
=== McCambridge at a glance ===
McCambridge was established in its current guise in 1985, but has a history of food production and retailing dating back to 1945. Since 1999, it has undergone 10 acquisitions - three in Ireland and seven in the UK. The latest of these was Inter Link Foods in July 2007, which made it the second-largest cake manufacturer in the UK. It now has 20 bakeries and employs some 1,600 staff.