‘Business builder’ Boparan aims for sharper focus

By Ben Bouckley

- Last updated on GMT

‘Business builder’ Boparan aims for sharper focus
Ranjit Boparan says that running Northern Foods and 2 Sisters Food Group across five rather than four business divisions this year will give the group a “sharper business focus”.

Boparan Holdings ceo Boparan made the announcement in the firm’s pre-close trading update, prior to its financial year end on July 30, which reported unadjusted sales up by 2%.

The document revealed that the firm anticipated full-year results in line with its proforma revenue of £2bn as of January 29, 2011, and earnings before interest, taxes, depreciation and amortisation (EBITDA) of £170m.

Boparan said he had appointed Steve Ellis as ‘integration director’ to “help drive the integration programme”​ in relation to 2 Sisters and Northern.

He added:“Progress to date has been good, with a number of initiatives, including the closure of the Leeds office and transferring activities to other locations in the group.”

Smarter and leaner

A new leadership team would “drive integration and deliver the targeted synergies in line with our plans”​, which included operations across five divisions, Boparan said.

Asked whether there were plans to consolidate production and close manufacturing sites, a Boparan Holdings spokesman told FoodManufacture.co.uk:

“Ranjit previously said that consolidation on the manufacturing side is not at the top of the agenda, although there are obviously smarter, leaner ways of working.

"Prior to the takeover in January he went on record as saying that he’s a business builder, and we are aiming to increase turnover from £2bn to £3bn by 2015.”

Leeds HQ closure

The spokesman explained that the firm was moving from four to five divisions from the start of its new financial year – with frozen the new addition – in a move he said was not dissimilar to Northern Foods’ setup before its recent reorganisation.

Thereafter 2 Sisters and Northern will be organised into the following divisions: UK poultry; European poultry; chilled; frozen; biscuits.

Northern announced in May that it was proposing to close its Leeds office and move the majority of staff to its shared service centre in Wakefield.

The spokesman confirmed that the office has now closed. “We all moved out at the end of June,”​ he said.

“There were less than 30 people there, and it was proposed that, rather than keep open a building that was only one third full, we would move to Wakefield.”

He added:“A small number of redundancies was proposed, I think it was nine people, and of those nine most have remained with the company.”

Commodity pressures

The trading statement revealed that the company completed a bond offering (understood to be worth £695m) in April 2011, to repay acquisition debts and those relating to Northern Foods.

Boparan said the customer environment over the past year had been challenging, “with continued commodity pressures that we are continuing to recover”.

He added that chilled foods growth had been strong, although the level of branded promotions across the market increased every year.

However, branded new product development involved the launch of a new biscuit line in Fox’s Ambers, he said. According to Nielsen figures, sales of Fox's Biscuits were up 5% to £161.8m in the year to January 22 2011.

The group is also seeking to redress the sales decline in its frozen division, with new Goodfella’s flat and garlic breads.

Boparan also welcomed Charles Allen as Boparan Holdings’ new non-executive chairman, and said the group was now searching for a permanent finance director.

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