Burton’s Biscuits profits soar ahead of proposed sale
The company’s EBITDA increased 24% to £34.6m (€40.7m) but sales fell 3% to £333m (€392m).
Burton’s owners Duke Street Capital, Apollo Global Management and the Canadian Imperial Bank of Commerce, last week put the company up for sale for an estimated £350m ($543m).
Burton’s produces Wagon Wheel biscuits and Jamie Dodgers and also makes biscuits for Cadbury. It employs over 2,000 people.
Premium biscuit
The company said its 2012 profit gains came through growing market share in UK sweet biscuit market in the UK and development of the business abroad.
Ben Clarke, CEO of Burton’s Biscuit Company, said: “Amidst a challenging and competitive consumer market, our stable of iconic Power Brands – Cadbury, Maryland, Jammie Dodgers and Wagon Wheels grew by 5%. However, our overall revenue declined 3% to £333m as we strategically exited low margin contract business.”
Burton’s is the number one premium biscuit player in the UK with a 25% market share. In fiscal 2012, it increased its UK sweet biscuit market to 9.4%
The majority of Burton’s sales come from its license to produce Cadbury biscuits. Its next biggest selling brand is Maryland cookies followed by Jamie Dodgers and Waggon Wheels.
International growth
The company is predominantly UK focused with 85% of sales coming in its domestic market. Ireland is Burton’s biggest international market followed by France. The company also sells in Scandinavia and a number of other nations such as Canada and the US.
Clarke said: “International revenues have grown at a 7% CAGR since 2009, through driving our Power Brands supported by significant brand investment, and direct relationships with international retailers such as Walmart, Carrefour and Loblaws.”
Possible suitors
In March, Burton’s hired Credit Suisse to conduct a strategic review and last week decided that selling the company was the best course of action.
Possible suitors could include Cadbury owner Mondelez International and the number one UK biscuit firm United Biscuits. PepsiCo, Kellogg Weetabix owner Bright Food are other potential candidates.
