Sweet success for RFG
Written on the 5 March 2009
LISTED food brand manager Retail Food Group has banked on budget conscious consumerism to increase its revenue by almost 40 per cent to $69.7 million.
The company’s NPAT exceeded guidance of $9.9 million in January to an interim profit of $10.6 million for the six months ending December 2008.
Dining out on the success of its Donut King, Brumby’s Bakeries, Michel’s Patisserie and bb’s café stores across Australia, RFG core operations amounted to $11.1 million, up 52 per cent from the corresponding period in 2008.
RFG chairman John Cowley says the result has exceeded all expectations in a tight retail market while the sale of its manufacturing base had reduced debt by around $19 million.
“RFG achieved a number of key milestones in the 2009 first half, including entering into the Donut King master licence agreement for China, which has seen two Donut King outlets commissioned, and also reached an agreement pursuant to which the company disposed of its central manufacturing facility,” he says.
CEO Tony Alford says the four retail brands experienced robust trade in November and December 2008, but the company could not be complacent in the challenging retail environment which will prevail throughout 2009.
“Research supports our position that consumers are increasingly budget-conscious and demand a memorable retail experience if consumer loyalty is to be retained,” he says.
“While Australians may be decreasing the purchase incidence of large ticket discretionary items, consumers will still seek to reward themselves with treats like donuts, coffee and cake. Australians are also increasingly demanding affordable and healthy meal options like breads, quiches and sandwiches.
“There is also a trend for more home dining and entertaining, as opposed to restaurants. Providing affordable meals options like quiches, breads, sandwiches, cakes and other treats for these occasions will also be a core focus in the year ahead.
“It is these aspects which our retail brands will continue to focus on – providing a memorable retail experience including exceptional service, relevant menu and quality products which represent value for money.”