Public Announcements

2 Sisters Food Group reaches agreement to acquire Brookes Avana

December 8, 2011

Boparan Holdings, the holding company for 2 Sisters Food Group, today announces it has agreed to acquire the Brookes Avana business from Premier Foods for a cash sum of £30 million.

Brookes Avana is a supplier of high quality chilled convenience products, including Ready Meals, Accompaniments, Chilled Pizza and Pies from facilities based at Rogerstone Park in South Wales and Leicester. Avana is one of the UK’s leading suppliers of high quality bakery, cake and dessert products from three facilities based at Rogerstone. 

The acquisition would provide a strong strategic fit and would further strengthen 2 Sisters Food Group’s capabilities in the Chilled and Bakery markets, offering a growth platform and a more diversified range of food products for every eating occasion. Brookes Avana produces for all of the UK’s major retailers.

For the year to 31 December 2010, the Brookes Avana business had a turnover of £203.6 million and made a trading loss of £(0.1) million. All historic pension liabilities will be retained by Premier Foods.

Ranjit Singh, Chief Executive of 2 Sisters Food Group, said: “We are delighted to reach agreement on the acquisition of Brookes Avana.  The business has a strong track record in delivering high quality products for its customers and would provide a growth platform for 2 Sisters and increased product diversity to serve every eating occasion.

“This is an excellent strategic fit and, following completion, we will focus on delivering future growth opportunities and enhancing the performance of the business.”

Enquiries:

Steve Henderson. Group Finance Director                                        01924 831300
Andrew Hanson, Head of Communications                                       07809 595831

BOPARAN HOLDINGS
FULL YEAR RESULTS FOR THE 52 WEEKS ENDING 30 JULY 2011

November 18, 2011

Boparan Holdings Limited, the holding company for 2 Sisters Food Group, today announces its full year results for the 52 weeks ending 30 July 2011.

Financial highlights (Pro Forma 52 weeks to 30 July 2011)

• Full year Pro Forma revenue of £2.1bn

• Full year like for like (LFL) sales up 4.1% on an adjusted* basis (Price +2.4%; Volumes +1.7%); 1.4% on an unadjusted basis

• Pro Forma Adjusted** EBITDA at £170m

• Net debt*** £655m at 30 July 2011

NOTE: Pro forma results for the 52 weeks ended 30 July 2011 are unaudited and are derived as though all acquisitions were owned for the whole of the 52 weeks ended 30 July 2011.  A copy of the full audited statutory accounts for the period ending 30 July 2011 is contained in the enclosed Bondholder report.

*Like for like sales are based on Pro forma sales for the 52 weeks ended 30 July 2011 compared to sales for the prior year 52 weeks ended 30 July 2010 on an adjusted basis to exclude the impact of discontinued operations (the sale of Dalepak in August 2010 and the closure of Ethnic Cuisine in September 2010)
** Pro Forma Adjusted EBITDA is pre-restructuring costs and after adjusting for Uffculme feed mill and unrealised exchange loss on retranslation of the €340m senior notes.
*** Net debt comprises senior loan notes, cash and finance leases

Operational highlights

• Integration of Northern Foods progressing to plan; synergy expectations for FY12 unchanged (£15m-£25m before integration costs)

• Solid result for 2011 in a tough market environment, set against the impact of inflation on manufacturers, retailers and consumers

• Chilled division delivered steady progress in sales and margins in the growing Ready Meals and Sandwiches & Salads markets; LFL sales up 10.7%

• UK and European Poultry traded in line with expectations after dealing with feed cost inflation; LFL sales up 4.2% and margins slightly down reflecting phasing of input cost recovery

• Branded division saw LFL sales decrease by 3.2% (Biscuits up 7.5%; Frozen down 11.6%) reflecting continued challenging trading in Frozen division offsetting Biscuits growth; Biscuits grew sales and market share and retained solid margins, benefiting from new product development, including Fox’s Ambers and new snacking products

• Frozen sales and margin performance remained weak as we continue our work to sharpen performance in the division; Goodfella’s pizza brand relaunched in September 2011, focusing on Italian heritage

Other developments

• One culture and one identity being rolled out into the business – “2 Sisters Food Group”

• New Board structure with Charles Allen CBE as independent chairman; Mark Hunter (CEO MolsonCoors UK & Ireland) appointed non-executive director and Remuneration Committee Chairman; Andrew Cripps as non-executive director and Audit Committee Chairman and Steve Henderson appointed as Group Finance Director. David Gregory already in place as non-executive director and Safety & Governance Committee Chairman

Ranjit Singh, CEO of Boparan Holdings Limited, said: “In a challenging trading environment, we delivered a solid performance for our 2010/11 financial year, which was in line with our expectations. Following the acquisition of Northern Foods in April 2011, our integration programme is progressing to plan and our synergy expectations are unchanged from our previous guidance. Across our operating businesses, our divisional structure, effective from the current financial year, will enable us to have a sharper focus on our performance”. 

Chilled

We continued to see progress in our predominantly own label Chilled division, where markets remain competitive but in steady growth, and our sales and margin momentum continued.  We continue to have strong product offerings in Ready Meals, Sandwiches & Salads and Chilled Pizza.  In our Christmas puddings business, we have a good order book for Christmas across own label and brand, including our new Fox’s branded Christmas pudding and an increased production run of last year’s successful Heston Blumenthal ‘Hidden Orange’ Christmas pudding.

Poultry

In UK and European Poultry, we saw a phased recovery of the impact of higher feed costs, edging margins slightly down for the full year. Input costs remain high and pressures on margins still exist as promotional activity continues to drive volumes.  Our new Thetford prepared poultry facility became operational during the year and is now reported as part of Chilled.  In Europe, the small acquisition we announced in July has provided an opportunity to start growing sales to retailers in Europe over the coming years.

Branded

In Biscuits, with our leading Fox’s brand, sales growth progressed, with new own label business and innovative products including Fox’s Ambers and snacking to go products, a market where we see good growth potential.  Margins were flat versus the prior year as we saw increases in promotional activity.

Frozen trading continued to be tough with sales and margins remaining weak as we continue our work to sharpen our performance in the division. Our Goodfella’s pizza brand was relaunched in September 2011 to focus the product, packaging and marketing back to its Italian roots.  Initial feedback to our Goodfella’s relaunch has been positive, but we retain our view that the reinvigoration of the brand will take time in what is a very competitive market, with high promotional levels.  In Pies & Pastry, we recently secured additional own label volume to help fill spare capacity at our Portumna site in Ireland.

Customer relationships

We continue to have strong customer relationships, putting the customer at the heart of everything we do.  In a challenging economic environment, we have seen the benefits of a two-way relationship with our customers, supporting them in their growth plans and ensuring that we remain integral to their long term strategies.

Commodity inflation

We succeeded in recovering the impact of higher input costs during the year.  As an average across our basket of key commodities we saw around 6% inflation year on year. Input costs remain high and in line with our previous guidance, we do not expect to see any material easing of commodity inflation until the latter part of our current financial year.

Integration

On integration, we are making good progress with some quick wins; closing the previous Northern Foods headquarters in Leeds, moving to one Shared Service Centre in Wakefield; moving to one centralised Procurement team and focusing on a smaller number of suppliers; and developing a coordinated waste programme to minimise our waste and reduce costs. Our synergy expectations of £15m-£25m in FY 12 with associated costs of c£4-£5m are unchanged.

We have tightened our cash control across the Group, with a working capital improvement plan in progress. In line with previous guidance, we expect to keep capital expenditure at around 1.5% of sales this year.

We continue to bring our different cultures together as 2 Sisters Food Group, operating as one team where everyone counts and delivering the highest quality at the lowest cost.  We are also renaming our holding company 2 Sisters Food Group Holdings, which will take effect from January 2012. We are working to ensure we have fit for purpose structures and resource in place across the whole business, with some recent headcount reductions. We are also continuing our plans to ensure our pension schemes are affordable and sustainable in the long term, with the proposed closure of the Northern Foods defined benefit schemes to future accrual. The UK defined benefit scheme was closed to future accrual from 1st November 2011. We will commence the long term deficit reduction payments, agreed with the Trustee, of £15m per annum to the main Northern Foods UK scheme starting in 2011/12.

With our new Board structure now in place, we have the appropriate levels of governance and non-executive expertise to support our management teams.

Q1 trading

• Q1 2012 Group like for like sales up 9.8%

• Q1 2012 Chilled momentum continues, with LFL sales up 9.6%; Poultry LFL sales strong, up 12.9%; Branded LFL sales up 3.7%, reflecting a return to sales growth in Frozen and slower growth in Biscuits

• Q1 2012 Group EBITDA margins will be slightly lower as we invest in growth with our customers; Full year margin expectations unchanged

The first quarter of our new financial year has seen a solid start with good sales growth as we work with our customers to deliver value to the consumer. In the short term this is expected to slightly dilute EBITDA margins, in what remains a tough trading environment, however, on a full year basis, our expectations of broadly flat margins – as previously communicated – remain unchanged.  The momentum in our Chilled division has continued, with our Thetford prepared poultry facility completing its commissioning.  Poultry performance remains solid and we are investing in growth with our customers. Branded reflects a return to sales growth in Frozen, whilst in Biscuits, lower market growth has led to a slightly slower sales momentum in the first quarter.

Q1 has also seen the first synergies coming through as part of our Integration programme.

Outlook

Whilst we have made a solid start to our new financial year and our integration programme is progressing to plan, we retain our cautious outlook for 2012, reflecting the headwinds of a competitive market environment, continued high commodity and other input costs, and increasingly cash conscious consumers. Despite these challenges, we continue to put the customer at the heart of everything we do, providing value for money with quality products in both own label and brands. We remain in a good position to grow our business over the years ahead.

Enquiries:

Steve Henderson, Group Finance Director                            +44 7801 033039
Andrew Hanson, Head of Communications                           +44 7809 595831

A copy of this announcement will also be made available at www.northernfoods.com under the Bond Investors sections

Next update: A first quarter trading update for the period ending 29 October will be made on Thursday 19 January 2012.

About Boparan Holdings:

Boparan Holdings is the holding company for 2 Sisters Food Group. We are a leading diversified food manufacturer with strong market positions in Poultry, Chilled, Bakery and Frozen categories. We focus on delivering the highest quality products to our customers at the lowest cost.

Further Board appointments at 2 Sisters Food Group

November 15, 2011

2 Sisters Food Group is pleased to announce further executive and non-executive appointments which will strengthen its Board and provide the appropriate levels of governance to support the Group’s growth plans.

Steve Henderson, currently Acting Group Finance Director, has been appointed as Group Finance Director.  Steve is an Ernst & Young qualified FCA and brings a wealth of experience to the role, including over 16 years with Northern Foods plc in a variety of finance roles.  He has extensive debt funding and M&A experience and strong pensions experience with the Northern Foods pension schemes.

Andrew Cripps has also been appointed to the Board as a non-executive director and Chair of the audit committee.  A qualified accountant, Andrew has extensive experience within the consumer goods sector, including roles in corporate strategy, finance and mergers and acquisitions, coupled with significant non-executive and audit chair credentials across a number of international listed companies.

An Economics graduate from Trinity College, Cambridge, Andrew began his career with KPMG before spending over 20 years with Rothmans International and BAT plc. He has held a number of non-executive roles including Molins plc, Trifast plc, Helphire Group plc and Carreras Group Limited. He is currently Deputy Chairman of Swedish Match AB and a non-executive director and Chair of the audit committee of Booker Group plc.

Charles Allen, Chairman of 2 Sisters Food Group, said: ““I am delighted that we have secured Steve and Andrew’s appointment to the Board of 2 Sisters Food Group. 

“Steve is an accomplished finance professional, with vast experience in the food industry and in a range of financial roles.  He will play a key role in managing the financial position of the Group as we continue our growth agenda over the coming years.

“Andrew is a strong leader who has excelled in a variety of financial and non-executive roles across the consumer goods sector. He has identified,
negotiated and led a number of large scale transactions and therefore has great experience to contribute to 2 Sisters Food Group’s growth agenda. He is also an experienced audit committee chair and will bring best practice corporate governance to the Board.”

Ranjit Singh, Chief Executive of 2 Sisters Food Group, said: “I am delighted that Steve and Andrew will be working with us as we grow our business.  They both bring a wealth of experience to 2 Sisters Food Group and with our vision to grow to £3 billion of sales, their experience will be integral to delivering this.”

Notes:

The Board of 2 Sisters Food Group comprises:

Charles Allen	Chairman
Andrew Cripps	Non-Executive and Chair of the Audit Committee
Mark Hunter	Non-Executive and Chair of the Remuneration Committee
David Gregory	Non-Executive and Chair of the Safety & Governance Committee
Ranjit Singh	Chief Executive
Steve Henderson	Group Finance Director

Enquiries:

Andrew Hanson, Head of Communications               +44 (0) 7809 595831

2 Sisters Food Group appoints Mark Hunter as Non-Executive Director and Chair of Remuneration Committee

August 2, 2011

2 Sisters Food Group is pleased to announce the appointment of Mark Hunter as a Non-Executive director and Chair of the Remuneration Committee.

Mark brings a wealth of experience from consumer businesses, with a specific emphasis on sales and marketing, and brand development. He is currently Chief Executive of Molson Coors (UK), a position he has held since 2007 following a number of sales, marketing and commercial roles both in the UK and Canada. His experience in brand development led him to be appointed as President of the Incorporated Society of British Advertisers in 2009.

The appointment follows Charles Allen becoming Non-Executive Chairman of 2 Sisters Food Group earlier in July and reflects the Group’s plans to grow its business in the UK and Europe over the coming years, following the recent acquisition of Northern Foods.  Further Non-Executive appointments are expected to be made to the new Board.

Charles Allen, Chairman of 2 Sisters Food Group, said: “I am delighted that we have secured Mark’s appointment to the Board of 2 Sisters Food Group. 

“Mark is a strong leader who has excelled in a variety of management roles during his career.  He brings a wide range of experience in sales, marketing and brand development and will provide valuable counsel to the Board and to the management teams as we work to grow our business over the coming years.”

Mark Hunter, said: “This is an exciting time to be joining the Board of 2 Sisters Food Group as they develop their growth plans and food offerings for every eating occasion.”

Note to editors:

Mark's experience includes his role as Marketing Director for Bass Brewers, where he achieved 100% growth in Carling Lager in the UK over the period 1996-2005.  He has more recently led a performance step change within the Molson Coors UK business, through a focus on brand, revenue growth and portfolio development, including the establishment of the Cobra beer partnership and recent acquisition of Sharp’s brewery.

In addition to his role as CEO of Molson Coors (UK), Mark also holds the following current roles:

• Vice Chairman and a Board Director of the British Beer & Pub Association

• Member of the Portman Group Council

• Trustee of Drinkaware

About 2 Sisters Food Group:

2 Sisters Food Group is a leading food manufacturer with 39 sites and 16,000 employees across the UK, Ireland and continental Europe. It has market leading positions in Poultry, Chilled, Biscuits and Frozen categories, with a combination of branded and own label products.

Enquiries:

Andrew Hanson, Head of Communications                           +44 (0) 7809 595831
Kate Holland, Communications Manager                              +44 (0) 7815 449215

Boparan Holdings Limited - pre-close trading update

July 13, 2011

Boparan Holdings Limited, the holding company for 2 Sisters Food Group and Northern Foods Limited, announces its first pre-close trading update prior to its financial year end on 30 July 2011.

Financial highlights

• Full year (July 2011) revenue and adjusted EBITDA expected to be in line with proforma January 29, 2011 revenue and adjusted EBITDA of £2bn and £170m respectively (as reported in the OM)

• Like for like sales* up 4.5% on an adjusted basis; 2.0% on an unadjusted basis

Operational highlights

• Continued sales progress during the period:

  • Chilled division benefiting from strong market growth in both sandwiches & salads, and ready meals

  • New product development in Brands, including Fox's Ambers, Goodfella's Flatbread and Goodfella's Garlic Bread

  • UK poultry has now recovered inflation; new Thetford facility now open

  • European Poultry trading in line with expectations

• Inflation recovery progressing in line with our plan

• Integration of 2 Sisters Food Group and Northern Foods progressing to plan

Other developments

• Successful Bond offering completed in April 2011 to repay acquisition debt following Northern Foods transaction, and to clear existing Northern Foods debt; new £40m Revolving Credit Facility established

• Appointment of Charles Allen CBE as independent Chairman of the Group

Ranjit Singh, CEO of Boparan Holdings Limited, said:

"We have seen a solid financial and operating performance during the period, in what remains a challenging consumer environment and with continued commodity pressures which we are continuing to recover. Sales and profits for the full year are expected to be in line with the proforma we set out during our Bond offering in April.

"Across our operating businesses, our Chilled division continues to perform well. Market growth in chilled categories remains strong and we continue to excel for our customers in delivering high quality products and strong service levels. In Brands, promotional activity in the market is higher year on year, with volumes in Biscuits increasing and with new products being rolled out, including Fox's Ambers. In frozen pizza, we are seeking to redress the previous sales decline with new products including Goodfella's Flatbread and Goodfella's Garlic Bread. The UK poultry market has seen significant inflation, with reduced volumes as consumers focus on reducing waste. In UK and European poultry, we continue to trade in line with our expectations, with a focus on recovering the impact of higher feed costs."

"The integration work following our acquisition of Northern Foods is progressing to plan and we believe we have the right recipe to become fit for growth and further develop our business in the years ahead. We have received positive feedback from our customers and stakeholders, and we remain fully focused on delivering the highest quality for the lowest cost. To help drive the integration programme, we appointed an Integration Director in Steve Ellis, with nearly 20 years experience in lean world class manufacturing, sales, procurement and logistics. 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; the establishment of a new Leadership team to drive integration and deliver the targeted synergies in line with our plans; and we are planning to operate across five divisions from our next financial year, thereby ensuring that we have a sharper focus on our performance."

"Our appointment of Charles Allen CBE as non-executive Chairman also brings us a wealth of experience and wise counsel as we seek to grow the business over the coming years.  With Charles appointed, we will look to further develop the Board and a recruitment process for a permanent Group Finance Director is also underway."

Outlook

Like many predominantly UK focused businesses, we share the cautious economic outlook into our next financial year. However, we have quality products, strong brands and we will continue to progress our integration programme, both to deliver targeted synergies and to become fit for growth. 

* Like for like sales (underlying revenue) excludes the impact of discontinued operations. Adjusted like for like sales reflects the sale of Dalepak in August 2010 and the closure of Ethnic Cuisine in September 2010

Enquiries:

Steve Henderson, Acting Group Finance Director     +44 (0) 7801 033039
Andrew Hanson, Head of Communications               +44 (0) 7809 595831
Kate Holland, Communications Manager                   +44 (0) 7815 449215

Full year results will be announced in the first half of November 2011 (date to be confirmed)

About Boparan Holdings:

Boparan Holdings is the holding company for 2 Sisters Food Group and Northern Foods Limited.  We are a leading diversified food manufacturer with strong market positions in Poultry, Chilled, Bakery and Frozen categories. We focus on delivering the highest quality product to our customers at the lowest cost.

2 Sisters Food Group appoints Charles Allen as Non-Executive Chairman

July 11, 2011

2 Sisters Food Group is pleased to announce the appointment of Charles Allen CBE as its Non-Executive Chairman.

Charles brings a wealth of experience to the role from a range of retail and consumer business sectors, including food, hotels, entertainment, music and media. He has held the role of Chief Executive or Chairman at ITV plc, Compass Group plc, Granada Group plc, Granada Media, Forte Group and EMI.  Charles is currently Chairman of Global Radio and a senior adviser to Goldman Sachs. Until last year he was a non-executive director of Tesco plc.

The appointment follows the recent acquisition of Northern Foods.  Northern Foods is being integrated with 2 Sisters Food Group to form a business which will be the fourth largest food producer in the UK, with £2 billion of annual sales and which is seeking to grow to £3 billion of annual sales by 2015.  Charles acted as an adviser during the acquisition process and will sit as an independent Chairman of the Board of 2 Sisters Food Group.

Ranjit Singh, Chief Executive of 2 Sisters Food Group, said: "We are delighted that Charles is joining us.  He brings a wealth of experience to 2 Sisters as we work to become fit for growth and bring the teams across 2 Sisters and Northern Foods together.

"We have a vision to grow to £3 billion of sales by 2015 and the experience Charles has across many sectors will help us to deliver on this."

Charles Allen said: "This is an exciting time to be joining the Board of 2 Sisters and I am impressed by the real passion for putting the customer at the heart of everything the company does. I am really looking forward to working with Ranjit and his team as we continue to build the business."