Kitwave results drop “in line with board’s expectation”
The impact of the “severely disrupted” hospitality sector is reflected in Kitwave’s latest six-month interim results.
The wholesale group’s figures were published in line with its new status on the AIM London Stock Exchange earlier this year and accounts for the period that ended 30 April 2021.
While still in the green, the level of operating profit, revenue and cash generated all reduced compared to the year previous, but was in line the board’s expectation given the Covid-19 lockdown restrictions.
Revenues of £147.1 million represented a drop from £399 million in the 12 months ending 30 April 2020, while operating profit was down from £7.6 million to £800,000 and cash generated from operations reduced to £9.8 million from £29.1 million.
It’s important to recognise this year’s figures measure six months of trade compared to the year-long figures ending in 2020.
“All of the group’s divisions have experienced some level of impact from the stop-start nature of COVID-19 restrictions during the period,” said Kitwave CEO Paul Young.
“Supply to pubs, restaurants and vending machine operators was severely disrupted as these businesses were either closed or operating under constraints. In contrast, our frozen & chilled division was extremely resilient and operated close to pre-Covid-19 levels throughout the period.”
The good news is that on the back of the gradual reopening of hospitality since this spring, indications are there for a strong recovery.
“Since mid-May 2021, Covid-19 lockdown restrictions have been eased and trade has accelerated,” added Young.
“Thanks to a period of warmer weather and consumer interest in the Euros, we are already experiencing sales volumes that are moving toward pre-pandemic levels; this was the case even before the highly anticipated 19 July 2021 ‘Freedom Day’.
“As such, we remain confident that the Group is on track to achieve its full year expectations. This belief is further supported by the timing of the return to normal, as it allows the group to take full advantage of the second half of our financial year, when trading is traditionally stronger due to the seasonality of the frozen & chilled division.
“The board anticipates a buoyant market to return once Covid-19 lockdown restrictions are removed fully and has confidence that the group will continue to be one of the leading independent delivered wholesale providers in the UK.
“The UK grocery and foodservice wholesale market remains highly fragmented and the directors believe this presents Kitwave with numerous additional growth opportunities.”coronavirus covid-19 hospitality Kitwave Paul Young reopening results wholesaler