Bank covenants with Lloyds Banking Group Plc have been renegotiated said Chris Thomas, Real Good’s executive director, while each of the businesses is ‘fundamentally sound’.
Sales growth has been strong-in the first 22 weeks of the this year he added, with like-for-like revenue up 10% year-on-year in both Cake Decoration and Premium Bakery and by 28% in Food Ingredients, though Thomas said it is recognised that these higher sales must be converted into operating profit and operating cash flow at the group level.
For the remainder of the 2017/2018 year, prior to the critical Christmas trading period, sales prospects continue to remain positive, he said, though the benefits of upgrades to manufacturing capacity at Haydens and Renshaws will now come through fully in 2019.
Revenue in the year to March rose by 8% to £108.2mln while there was a pre-tax loss of £6.46mln (£4.74mln profit). Net debt was £16.2mln at the end of the year.
Shares eased 3% to 23.2p.