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Bidfood Europe
Product segmentation Market segmentation
2017
2017
Frozen
Chilled
Ambient
Non-food
2017
30%
36%
27%
7%
2016
31%
34%
27%
8%
Logistics
Chain
Independent
Retail/other
2017
15%
23%
42%
20%
2016
14%
24%
39%
23%
Trading profit
R1,2bn
2016: R1,1bn
Revenue
R32,2bn
2016: R31,0bn
Netherlands’
trading profit and revenue
met expectation as the national economy
showed some growth and unemployment
fell. Performance was driven by a strong
showing in the hospitality sector. In the
national accounts, institutional and catering
channels, sales and margins are generally
under pressure.
Free trade within the hotel, restaurant and
catering channels has become a significant
driver of the business. Particularly strong
growth was seen in the south and west of
the country. Further restructuring of the cost
base is required to align activities with the
focus on the free trade sector. Rebranding as
Bidfood was successfully launched.
Belgium
teams optimised sales
opportunities as economic growth ticked
higher and unemployment fell. Trading profit
was also above budget. Margin pressure
persisted, but was generally well managed.
Cash generated from operations was up
significantly due to good working capital
management.
Revenue rose 4,0% to R32,2 billion (2016:
R31,0 billion) while trading profit rose 11,5% to
R1,2 billion (2016: R1,1 billion). In constant currency
terms trading profit rose 20,5%. Eastern
European businesses continued to deliver good
growth, bolstered by the buoyant economic
conditions.
Revenue growth was driven by a strong
performance in the horeca channel, assisted
by the contribution of Bestfood, whose
acquisition was completed in September
2016.
The institutional wholesale business
exceeded expectations, boosted from
October by strong volumes on the back of
a new contract win. Logistics sales were
also above expectation. Numerous contract
renewals were achieved; in particular, a major
QSR customer contract for five years.
The Bidfood identity was successfully
implemented across the business during the
latter part of the financial year.
Development of a new agile and scalable
IT platform to support the business and its
evolution is well on track.
Iberia
was established with the newly
acquired Spanish business, (Guzmán) (in
April 2017) witnessed pleasing gains in the
independent sector in both Madrid and
Barcelona. Gross margins were impacted
by product price increases caused by frosts
during the early part of the calendar year.
However, these are normalising. Attention
will be focused on efficiency gains through
new IT upgrades and corporate structure
streamlining.
Bidfood Spain failed to meet its objective of
breaking even by year-end as mainland sales
volumes stalled in the last two months of
the year. Integration of our existing Bidfood
Spain operation into Guzmán is a priority in
the coming year. Specific initiatives include
the integration of the Guzmán warehouse
in Alicante with the nearby Bidfood Spain
warehouse.
Acquisition of a niche Portuguese horeca
business was completed early in the new
financial year.
DAC Italy
benefited from the Italian
economy’s continued gradual improvement
and our team optimised opportunities.
Trading profit exceeded budget and sales
growth was seen in all product categories –
ambient, frozen, chilled and non-food.
Frozen made pleasing gains, but the ambient
category still accounts for the biggest slice of
sales volumes while independent/street sales
are the biggest customer category. Strong
growth was maintained in this channel, which
now represents about 81% of total sales
volumes.
Own-brand growth continued and export
sales moved higher.
Sales to sister companies in the Bidcorp
group increased substantially, confirming the
broad appeal of an authentic “Made in Italy”
proposition in the global food business.
DIVISIONAL REVIEWS
Annual integrated report 2017
Bid Corporation Limited
32