G's Group reports top supermarkets boost annual sales

By Rod Addy contact

- Last updated on GMT

G's Group invested in packing equipment for its beetroot and fresh prepared factories
G's Group invested in packing equipment for its beetroot and fresh prepared factories

Related tags: Fresh produce, Finance

Fresh produce supplier G's Group, whose global customers include UK retailers Tesco and Co-op and manufacturers such as Bakkavor, has overcome the disruption of COVID-19 to report annual sales and profit growth.

In its results for the 52 weeks to 2 May, G's Group Holdings Limited said the fact that its major sales channel was retail rather than foodservice had helped. In addition, measures including the stockpiling of produce, packaging and personal protective equipment (PPE), together with a robust supply chain strategy had enabled it to shrug off the virus's impact. 

The company said it had ceased prepared salad bowl production in April as a result of 'a period of difficult trading and requirements for further investment to maintain current business', but this had not represented 'a material operation'.

Year-on-year sales rose by 3.8%, from £496m to £515m, while group operating profit soared from £1.6m to £13.4m.

The business, which supplies a variety of vegetables, fruit, mushrooms, pickles and natural juices, said it had invested £10.2m of capital expenditure in its operations and supply chain. The cash had been mainly spent on packing equipment for its beetroot and fresh prepared factories throughout the group, UK IT infrastructure and systems and land, irrigation and farming equipment in Spain.

'Increased demand'

"Whilst the global pandemic, due to COVID-19, has affected some customers negatively, others are either little affected or have even increased their demand for our products," ​G's Group stated in its annual report and consolidated financial statements.

"Wholehead, the largest customer segment, has seen rising demand as a result of the overall increase in retail; foodservice continues to trade at lower levels ... but this represents a much smaller segment of our group.

"The group has seen little impact on its supply chain, largely due to key relationships with long-term related party growers and management has used existing connections to source additional traded product to meet the higher levels of demand."

While the availability of labour had proved initially challenging, it had subsequently eased, the company said.

'None of our sites have been closed'

"Due to the critical nature of the products delivered by the group, none of our sites have been closed as a result of COVID-19 and the directors acted quickly to understand and manage both the positive and negative impacts of COVID-19 on all areas of the business,"​ G's Group stated.

"The group has taken measures to ensure social distancing in all facilities, introducing working from home policies for employees where applicable and possible, changing working hours and introducing team rotas to avoid overcrowded factories and offices, distancing each other where possible and installing plastic screens in areas where physical distancing is more difficult."

Due to supply chain contingency planning, the company said it expected little negative effects following the end of the Brexit transition period.

The business said it had focused considerable efforts on mitigating its environmental impact across the year, particularly analysing energy efficiency. "Energy efficiency has been a priority for the group, with investments in renewable power generation at main production sites already in place. During the period the group has procured energy efficient electric handling equipment replacing old gas powered equipment, supporting the commitment to move towards renewable power sources.

"Energy efficiency continues to be improved with a phased replacement of lighting and conversion to LED and a review of the production cooling systems at our sites to identify and replace systems with options which support a reduction in the group's greenhouse gas emissions."

Related topics: Fresh produce, Operations

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