Zamaz PLC (LSE:ZAMZ) has highlighted a strong performance from its wholly-owned luxury food subsidiary, Bella Dispensa Srl, which has recorded a big boost in turnover helped by acquisitions.
The international eCommerce and multi-channel luxury food and sustainable cleaning products brand aggregator noted that Bella Dispensa has made three brand company acquisitions in the six months since Zamaz's IPO, each of which has had a strongly positive impact on financial performance.
The acquisitions are Dallate Italia Srl, a manufacturer and distributor of luxury ice creams and other premium dairy products, announced on 13 February 2023; Eccellenze Srl - a 72 % stake in luxury foods offline retailer announced on 10 October 2022; and Ecocarne Srl, a premium fresh meat retailer, announced on 26 September 2022.
Following these acquisitions, the company's brand portfolio has grown significantly, as have group sales. Furthermore, the acquisitions of these brand companies are generating new finance partnerships and additional opportunities within distribution channels and product development which are expected to diversify the company's funding sources, grow its multi-channel distribution network and widen its customer base.
Bella Dispensa files statutory accounts in Italy, and for its financial calendar year ended 31 December 2022, which includes the merged results of both Ecocarne and Eccellenze for that year, it recorded a turnover (unaudited) in excess of €5.0 million (£3.91 million), an increase over the previous year of more than €4.86 million, representing an uplift of over 3,300%. Net operating margins reported for the period also improved by almost €0.6 million, moving from a start-up loss position to a positive €0.3 million (£0.24 million).
The acquisition of Dallatte was completed in 2023, therefore its trading performance does not feature in Bella Dispensa's 2022 statutory results. However, on a pro-forma basis, it would have added a further €1 million (£0.9 million) in turnover and €0.1 million (£0.09 million) in net operating margin.
Bella Dispensa's like-for-like sales are expected to increase as the company's growing online and offline multi-channel distribution network onboards the acquired brands. Operating costs are expected to fall proportionately, as integration of the businesses delivers savings. This, as well as the introduction of additional eCommerce channels to some of the acquired products which have to date only been sold offline, is expected to deliver further improvements in profit margin.
Zamaz said it should be noted that the results for Bella Dispensa to 31 December 2022 are related to, but are not the same as the results included in the consolidated financial statements of Zamaz, which has a financial year-end of 31 August. The company's board is, however, considering changing Zamaz's reporting date to 31 December in order to better align the business going forward.
The company said the subsidiary results are being announced as they will shortly be in the public domain in Italy and are price sensitive. They do, nevertheless, underline the rapid expansion it has enjoyed through its acquisition strategies.
Zamaz added that it continues to seek to acquire successful brand businesses, brand aggregators and retail technologies to deliver on its aggressive three-year buy-and-build growth plan, which it anticipates will deliver significant profitable growth and value creation for shareholders.
In the trading update, Martin Groak, chairman of Zamaz commented: "The board is very pleased with the speed at which the growth plan is being successfully implemented, resulting in the company being ahead of schedule in terms of its performance and market position. The team continues to source and negotiate acquisition opportunities which are in line with the company's strategy and which will drive revenue and profitability."
Zamaz said it will release its results for the six-month period ended 28 February 2023 in due course.