Significant sales growth at The Real Good Food Company’s bakery division, Hayden’s, has helped the firm achieve estimated profits of around 25% above current market expectations.
Hayden’s Bakeries achieved double-digit growth with all its major customers, for the year ended 31 December, including Marks and Spencer, Waitrose and Costa Coffee, with overall sales up 15%. In its pre-close trading update, the firm also revealed that a major investment plan is now being overseen by the management team, led by MD Paul Smith, to double the size of the business over the next four years.
Among its successes last year, the division grew its foodservice sales, an area the business moved into in 2008, which now accounts for almost 10% of total revenues. Twenty-nine products were either launched or re-launched during the firm’s “key launch window” in October, and mince pie sales hit record levels, with over 1.5 million pies produced - up 64% on 2008.
The supplier of sugars, bakery ingredients and manufacturer of bakery products, also announced record retail sales of sugar, within its ingredients business - Renshawnapier, in 2009, which was put down to a combination new contracts and growth in the home-baking market.
Sugar sales to small industrial customers increased strongly in the second half of 2009, with new product launches planned to help further drive growth in the division.
Bulk sugar sales reduced slightly due to weakness in the market, “following the final phase of the EU Sugar Regime changes in October”. However the firm announced a number of new contracts have already been gained for 2010.
“The Group expects to report profits before taxation and exceptional items for the year ended 31 December 2009, which are around 25% above current market expectations,” according to Real Good Food, which also managed to reduce its bank borrowings from £29.1m to £21.3m during the period end.
The firm expects to announce its preliminary results in mid-March.
Real Good Food Company is comprised of its ingredients business, Renshawnapier, and its bakery businesses Hayden’s Bakeries and cake manufacturer Seriously Scrumptious.