TIDMPFD TIDMIRSH
RNS Number : 6199R
Premier Foods plc
30 October 2023
30 October 2023
Premier Foods plc (the "Company" or the "Group")
Acquisition of FUEL10K, accelerating expansion into Breakfast
Premier Foods today announces it has acquired FUEL10K, a vibrant
Breakfast brand, with a portfolio of granola, oats and drinks
products, as the Group significantly expands its presence in the
Breakfast meal occasion.
Strategic highlights & opportunities
-- FUEL10K is a differentiated, protein enriched Breakfast brand
-- On-trend proposition which attracts a predominantly young
consumer demographic
-- Track record of strong double-digit revenue growth over the
last three years
-- Substantially increases Group's position in the Breakfast
category, building on success of Ambrosia porridge pots
-- The Group expects to unlock significant future value through
leveraging its proven branded growth model
-- FUEL10K's commitment to sustainability supports the Group's
purpose of Enriching Life Through Food
Alex Whitehouse, Chief Executive Officer
"The acquisition of FUEL10K follows on from our successful
integration of The Spice Tailor, where we have increased revenue
and profit through the application of our branded growth model.
FUEL10K provides us with an ideal platform to accelerate our
expansion into the Breakfast category, building on our recent
successful launch of Ambrosia porridge pots. Possessing a
differentiated category position, with its protein enriched product
range and appealing to a younger demographic, we expect to deliver
significant further profitable growth of FUEL10K through the
deployment of our successful branded growth model."
,
Barney Mauleverer, co-founder, FUEL10K
"We are very excited to be passing the reigns on to the owner of
such a great stable of UK brands. Having built the foundations from
start-up, the FUEL10K brand is now primed to accelerate into the
future and achieve even more great things. I could not think of a
better custodian of our brand than Premier Foods to entrust what we
have begun and make the most of such a great opportunity."
Transaction details
-- Premier Foods has acquired 100% of FUEL10K(,1) for an Enterprise
Value of GBP34.0m, equivalent to an EV/sales multiple of c.1.6x
on revenues(2) of c.GBP21m
-- Initial consideration of GBP29.6m funded through available
cash reserves
-- A minimum further deferred consideration of GBP4.0m will be
payable in FY26/27, with any increment to this dependent upon
certain growth targets(3)
-- Earnings accretive(6) in first full year
-- Post acquisition, the Group's FY23/24 Net debt/EBITDA is expected
to be lower than FY22/23
-- The transaction completed on 29 October 2023
Further information on the transaction can be found in an
investor presentation on our website at
https://www.premierfoods.co.uk/Investors/Results-Centre/2023-2024.aspx
Ends
About Premier Foods
As one of the UK's largest food businesses, we're passionate
about food and believe each and every day we have the opportunity
to enrich life for everyone. Premier Foods employs over 4,000
people operating from 15 sites across the country, supplying a
range of retail, wholesale, foodservice and other customers with
our iconic brands which feature in millions of homes every day.
Through some of the nation's best-loved brands, including
Ambrosia, Batchelors, Bisto , Loyd Grossman, Mr. Kipling, Oxo and
Sharwood's, we're creating great tasting products that contribute
to healthy and balanced diets, while committing to nurturing our
people and our local communities, and going further in the pursuit
of a healthier planet , in line with our Purpose of 'Enriching Life
Through Food'.
About FUEL10K
FUEL10K make fuel for busy people, with a protein enriched
Breakfast range which make mornings easier, tastier and more
nutritious. The portfolio includes a range of granola, oats and
drinks products which can be eaten at the Breakfast table or on the
go. FUEL10K is sold in the UK in all major retailers, convenience
channels and online and attracts a young demographic who need fuel
to power them through the day. A fast growing Breakfast brand,
FUEL10K was acquired by Premier Foods on 29 October 2023.
Contacts:
Institutional investors and analysts:
Duncan Leggett, Chief Financial Officer
Richard Godden, Director of Investor Relations
Investor.relations@premier foods.co.uk
Media enquiries:
Sarah Henderson, Director of Communications
Headland
+44 (0) 7884
Ed Young 666830
+44 (0) 7799
Jack Gault 089357
- Ends -
This announcement may contain "forward-looking statements" that
are based on estimates and assumptions and are subject to risks and
uncertainties. Forward-looking statements are all statements other
than statements of historical fact or statements in the present
tense, and can be identified by words such as "targets", "aims",
"aspires", "assumes", "believes", "estimates", "anticipates",
"expects", "intends", "hopes", "may", "would", "should", "could",
"will", "plans", "predicts" and "potential", as well as the
negatives of these terms and other words of similar meaning. Any
forward-looking statements in this announcement are made based upon
Premier Foods' estimates, expectations and beliefs concerning
future events affecting the Group and subject to a number of known
and unknown risks and uncertainties. Such forward-looking
statements are based on numerous assumptions regarding the Premier
Foods Group's present and future business strategies and the
environment in which it will operate, which may prove not to be
accurate. Premier Foods cautions that these forward-looking
statements are not guarantees and that actual results could differ
materially from those expressed or implied in these forward-looking
statements. Undue reliance should, therefore, not be placed on such
forward-looking statements. Any forward-looking statements
contained in this announcement apply only as at the date of this
announcement and are not intended to give any assurance as to
future results. Premier Foods will update this announcement as
required by applicable law, including the Prospectus Rules, the
Listing Rules, the Disclosure and Transparency Rules, London Stock
Exchange and any other applicable law or regulations, but otherwise
expressly disclaims any obligation or undertaking to update or
revise any forward-looking statement, whether as a result of new
information, future developments or otherwise.
Notes to editors:
1. The Group has acquired 100% of the shares of FUEL10K Limited
on a cash and debt free basis
2. Projected revenue to the year ended 31 March 2024
3. Additional consideration above the Enterprise value of GBP34.0m
is dependent on future sales growth to FY25/26 and subject
to a maximum cap of total consideration (comprising initial
consideration and additional consideration) of GBP55.0m. The
maximum cap reflects a stretching revenue target.
4. For year ended 31 March 2023, FUEL10K reported Profit before
tax of GBP0.5m; as at 31 March 2023, Gross Assets were GBP5.1m
5. There are no further conditions to be fulfilled post completion
of the transaction
6. Expected to be Adjusted earnings per share ("eps") accretive
in year one. Adjusted eps is defined as Adjusted profit after
tax divided by the weighted average number of shares in the
period. Adjusted profit after tax is defined as Adjusted profit
before tax less a notional tax charge of 25.0%. Adjusted profit
before tax is defined as Trading profit less net regular interest.
Trading profit is defined as profit/(loss) before tax, before
net finance costs, amortisation of acquired intangibles, fair
value movements on foreign exchange and other derivative contracts,
net interest on pensions and administration expenses. Net regular
interest is defined as net finance cost after excluding write-off
of financing costs, early redemption fees, other interest payable
and other finance income.
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END
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