The deal covering Napier Brown’s branded range of Whitworths sugars will double the retail value of its sugar sales. No financial details of the new deals were disclosed.
Beginning later this month, the new contracts will include the supply of more than 60 separate product lines, including the Whitworths everyday and specialist ranges, ‘Whitworths for Baking’, plus new product lines targeting specific consumer needs.
The fastest growing brand
Whitworths Sugar has become the fastest growing brand in the sugar category after a re-launch last year and the launch of the 'Whitworths for Baking' range in summer 2012, said the firm.
Napier Brown’s new sugar hub, a £3.5M development in new sugar handling facilities at Immingham on Humberside, is nearing completion. The project is due to be completed by the end of the year.
The facility will enable the efficient handling of bulk sugar shipments arriving by sea and their onward distribution to food manufacturers and other customers across the north of England, claimed the firm.
The verdict from Phil Carrol, City analyst with Shore Capital, was: “Overall, a positive announcement from RGFC.”
RGFC shares were trading on “an undemanding valuation” of price-to-earnings ratio of 6.8x, he added. The ratio of earnings value/earnings before interest, tax, depreciation and amortisation was 4.9x.
Shore Capital does not offer a recommendation on RGFC’s shares.
Pieter Totté, group chairman, said: “I am delighted by the success of John Tanner and his team at Napier Brown in securing these important new contracts, which represents the culmination of 18 months’ hard work. We look forward to building our relationships with both Asda and Booker and believe that the Whitworths brand still has huge growth potential.”
Napier Brown is Europe’s biggest non-refining sugar distributor. The RGFC also owns bakery ingredients firms Renshaw and R&W Scott, dairy ingredients business Garrett Ingredients and patisserie and desserts firm Haydens Bakery.
Meanwhile, in September the RGFC attributed a 24% rise in profits to £10.5M this year to an increased focus on brands and a management restructuring.
The group, which had traditionally been an own-label producer, now ran each business as a distinct unit and had adopted a “commercially-driven strategy”, Totté told the firm’s annual general meeting last month.