7 Finsbury Food Group Annual Report & Accounts 2017


Chief Executive’s Report


" Finsbury's goal is to ensure that the Group is well positioned to maintain pricing for consumers and to remain a low cost producer for customers."


Finally, we have entered into consultation for the closure of Grain D’Or, the Group’s loss-making pastry factory. Over the two and a half year period since acquisition we have been working closely with management of this site to stem the losses it experienced. However, although improvements have been made, the ongoing pressures from commodity and labour cost increases has made it difficult to maintain customer contracts. The cost to close, if seen as an investment, will be justified by the reduction in losses. The Group will update the market following the completion of the consultation process and, depending on the outcome, will outline the financial consequences of any decision.


A Consistent Strategy for Uncertain Times


Our vision is to be a leading speciality bakery Group which produces a broad range of high quality products for growing channels and market niches, delivers growth and differentiation for our major customers, and fulfills end-consumer requirements. Our focus is on the UK but increasingly we are extending our reach into Europe.


We operate in competitive sectors and markets, supplying brand partners and customers with innovative, safe and high quality bakery products which anticipate and fulfil consumer trends, are efficiently and sustainably made and offer great value. These results show that this strategy has delivered results for the Group.


Additional investment to better understand consumer needs and category growth opportunities complements the product, business process and people investment outlined previously. Our ability to leverage scale and best


practice intellectual property across the Group, whilst delivering for individual customers and brand partners, is central to our continued competitiveness and underpins our growth ambitions. It is rewarding to see Group businesses winning a number of externally recognised industry and customer food awards, whilst also extending and deepening our licensed brand relationships with both existing partners such as Thorntons and Mars, as well as new partners such as Mary Berry.


In line with our stated growth strategy the Group has continued to explore acquisition opportunities that fit strategically and meet our value criteria. However, none were successful in the year as valuations remained unrealistic given known market headwinds. More challenging market conditions may provide new acquisition opportunities in the year ahead and we remain patient. Meanwhile there are ample opportunities identified to further strengthen and optimise our current Group businesses.


I would like to thank my Board, Executive teams and the thousands of colleagues across Finsbury for their continued commitment and hard work in baking great food products every day and in particular, to those individuals which drive the investment and change programmes on top of their other day job responsibilities.


The business environment isn’t going to get any easier but I remain confident that Finsbury has the right people, investment approach and M&A strategy to deliver growth in the years ahead, delivering value for employees, customers and shareholders alike.


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