€84m profit hike for Europe giant Baker & Baker

Baker-Baker-reports-2023-revenue-hike.jpg
Crossovers and collaborations adding to Baer & Baker's bottom line. Source: Getty

European bakery major Baker & Baker has benefited from a business overhaul and restructure, as well as key investments, leading to rocketing 2023 finances.

Revenue for the two-year-old business ramped up by 12% to €620m for the year, with gross profits up 18.2% to €83.9m.

Volumes, however, remained flat at +0.2%, although were “better than expected” in light of cost-of-living hikes and material inflation increases experienced by the bakery category.

Structural changes to the business during the reporting period included a €5m investment in productivity enhancements and a shift in product mix in line with changing consumer preferences.

€3m cookie facility online

“Cost controls were also a key driver of improvement in adjusted EBITDA performance in comparison to [the] prior year,” the business said/

Some €2.9m was pumped into cookie capability expansions at its Wirral, UK, which came online mid-2024.

In Spain, the business recorded a 6.5% volume and 22.9% revenue rise, while its Peniche facility in Portugal was operational within the reporting year also, “with the iconic Pastel de Nata product complementing the business’ portfolio throughout European markets”.

New markets reached in 2023 included the UAE and Jordan, identified as big growth markets, with Saudi Arabia opened this year.

Baker & Baker had focused on developing better foodservice relationships and collaboration opportunities during 2023, allowing it to expand its revenue base.

European bakers targeting the US

Profitable collaborations include an exclusive licensing partnership with Mondelēz to launch the Cadbury Crunchie Doughnut and Cadbury Chocolate Orange cookies.

“Baker & Baker is a clear category leader in American sweet bakery, and our expertise and market know-how offers a key point-of-difference with customers, allowing us to drive sales throughout the retail and foodservice channels,” said CEO John Lindsay.

“2023 was also characterised by the cost-of-living crisis and inflation across all major food categories, and so to have maintained volume performance in the face of these market challenges represents a significant success.”

Meanwhile, more European bakers have been targeting the US market to develop physical operations there after a gap for par-baked, artisanal baked goods was spotted.