Iglo Group’s net sales fell by 1.9 percent in 2014, reflecting difficult market conditions in the United Kingdom and Germany. However, there was growth in eight out of 12 markets, with Italy again performing strongly, the company said.
The European frozen food business, which trades under the Birds Eye brand in the U.K. market, also reported that its gross profit margins increased 1.8 percent year-on-year and that its overall debt has been reduced by EUR 100 million (USD 110.1 million).
Europe’s retail market continued to be challenged last year and the frozen food market declined by 0.5 percent. Despite the tough climate, Iglo’s Italian business has delivered five successive quarters of net sales growth and was up 2.1 percent in 2014. The company attributes this performance to the launch of a number of new products, particularly in the “Seafood” and “Pyramid Meals” categories.
In the U.K. market, Birds Eye launched its “Inspirations” range in the second-quarter, which included the introduction of new fish and chicken products as well as the migration of existing premium range products. Inspirations achieved retail sales of EUR 60 million (USD 66.5 million) in 2014.
Iglo’s new product development (NPD) also led to the launch of its “Steamfresh” platform in the U.K. and Austrian markets in the third-quarter and “Stir Your Senses” line in Germany and the Netherlands in the fourth-quarter. The latter range is scheduled for introduction to U.K. retail in the first-quarter of this year.
“Despite a disappointing decline in overall sales, we have been able to boost NPD, expand our gross margin by 180 basis points and invest in our strategy, launching new innovation platforms and increasing our A&P (advertising and promotions) spend to support our ‘Food of Life’ media campaign. We have repositioned the company for growth while maintaining our EBITDA margin in line with our strategic target,” said Elio Leoni Sceti, chief executive of Iglo (pictured).
Sceti said market conditions would “continue to be tough” in 2015 but believes that the innovations Iglo is bringing to market as well as its focus on growing gross margin will “position us well” to overcome these challenges.
“In the U.K. our new Inspirations platform has been judged by Kantar to be the biggest FMCG (fast-moving consumer goods) product launch of 2014, reflecting the success of our big initiatives. We are focused on building a nimbler and more competitive business and the momentum that we have established will continue to help mitigate the effects of the overall economic environment,” he said. The company pulled out of the Romanian, Turkish and Slovakian markets towards the end of last year following a review of its geographical footprint.
