Associated British Foods (ABF), owners of Allied Bakeries and their £30m plant at Bredbury in Stockport, has replaced the sales lost last month following Tesco’s decision to de-list ABF’s Kingsmill sliced loaf, according to their Chief Executive, George Weston.
George Weston said:
The UK bakery market remained “intensely competitive”, impacting on the profits of Allied Bakeries, owner of the Kingsmill brand, adding:
“The profitability of Allied Bakeries reduced as a result.” He blamed over-capacity in the industry, reducing manufacturers’ margins and retailers seeking to prove their value credentials in shopping staples, such as bread.
However, the investment programme to modernise its bakeries is almost complete and it claims to be “winning new volume in the market”.
Weston added:
“Although we lost the contract to supply Tesco with Kingsmill bread after the half year, the lost volume has been replaced elsewhere.”
It is not known at this stage how it has replaced this substantial volume, which could be via own-label provision or listings elsewhere.