The Sheffield, United Kingdom-headquartered Fletchers Group of Bakeries has secured a £22 million refinancing package and renewal of banking facilities as it aims for long-term business growth, announced Paul Devlin, group finance director.
The group, which is a major supplier of frozen baked goods to Britain’s foodservice and retail markets, has partnered with ABN AMRO in the five-year financing package, which provides a £4.5 million increase in availability against its previous line of credit. Fletchers aims to use the facility to maintain growth and plant development across its Sheffield, Manchester and London sites.
“This is a significant step for the business, allowing us to further strengthen our balance sheet and pursue strategic options for the group for the foreseeable future,” said Devlin. “Over the last two years, Fletchers has invested more than £14 million in existing facilities and creating new capacity. We have also had to make some hard decisions to rationalize non-profitable parts of the business, and facing these difficult challenges has strengthened the company substantially.”
The past 12 months have seen significant changes within the group, according to the finance director, as Fletcher’s management team has brought a number of key projects to fruition to create a platform for future growth.
In its latest filed accounts, for the year ending on March 30, 2013, the group posted a pre-tax profit of £2.8 million on sales of £99.1 million.
Recent developments have witnessed the closure of a loss-making facility in Barnsley, as well as an investment of £7 million in a new production facility in Sheffield, and a £4 million expansion of food manufacturing facilities at Grain D’Or in London to increase production capacity by 40%. Furthermore, a £1 million investment has been made in a new coldstore facility in Manchester to double capacity and enhance environmental and technical efficiencies at the company’s Kara Foodservice business unit.