Premium Bakery is a growing sector with volume in commodity bakery in decline alongside growth in value as consumers migrate to higher value premium offerings both in home and increasingly out-of-home.
Premium Bakery profile 2015/2016
Despite narrowing its product range Haydens grew its sales by 4% YOY with the growth rate quickening to 12% in the second half of the year. Customer service was excellent over the critical Christmas and Easter periods but at a cost of significantly increased labour which impacted margins leading to a decline in EBITDA over last year.
The extension of the customer base had a positive effect on sales but product complexity remains the challenge and is being addressed with an even greater focus on fewer product lines. The impact of this was already being seen in the final quarter.
The Chantilly acquisition took place late in the year with sales and margins in line with expectations.
The process of further focusing on core lines and processes where Haydens has recognised product superiority will continue. Part of this will be the launch of a small range of branded premium indulgent sweet treats which will be sold to a range of customers and generate significant scale.
The Chantilly acquisition has already highlighted a number of cross selling opportunities (both opportunities for Haydens within foodservice and also Chantilly within retail) which will be pursued. There are a number of opportunities for automating non-added value, manual processes and these will be prioritised against the scale achieved in each product sector.
Premium Bakery includes the following businesses:
Haydens bakes premium tarts, pies and crumbles, Danish, sweet buns, yum yums and doughnuts and sells to major retail customers and through foodservice channels. It operates both an ambient and frozen supply chain. It also operates a same day consolidation service for all Waitrose stores for both Haydens and third party products.Visit haydensbakery.co.uk >