2 Sisters targets further growth opportunities following refinancing

Leading food manufacturer 2 Sisters Food Group has announced the next significant stage of its turnaround strategy with a successful refinancing of its business.

2 Sisters at Dial Lane, West Bromwich
2 Sisters at Dial Lane, West Bromwich

Investors across the UK, US and Europe have backed the Birmingham-based group with a new £475 million bond, allowing the business to cement its progress over the past two years and provide the funding to build on a strong full-year financial performance.

In addition, a new £80m revolving credit facility provides the goup with extra lending flexibility should the need arise in the future.

The refinancing will now enable the business, which has chicken processing factories in West Bromwich and Wolverhampton, to push through the next stages of its development, including accelerating sales and margin performance in its core poultry and meals divisions and enabling further cash generation.

Craig Tomkinson, group chief finance officer, explained: “This is very good news for 2 Sisters and its stakeholders. It shows great confidence in our business and by securing funding until 2025, gives us the freedom to execute our plans for the future. We are very proud of our results to date in the turnaround of the business, and the de-levering of our balance sheet. This refinance marks a milestone in the progress of the turnaround plan, and gives a platform for further improved free cash flow generation into the future.

“Not only is this good news for our business, but all 18,000 colleagues, 16,000 members of our pension schemes, and our investors. Further, it provides security and reassurance to the thousands of jobs and livelihoods across our wider supply chain – customers, our suppliers and in turn their suppliers. We are upbeat about our growth plans and see further opportunities for 2021 as we prepare for a post-Covid and post-Brexit environment.”

Ronald Kers, the group chief executive, added: “It is very gratifying to see the strong support of investors in our new bond offering, which underlines the market’s confidence in our business and its belief in our on-going turnaround strategy. We are also pleased with the acceleration of our performance over the past 18 months, and despite the challenges that Covid brings with it, we are confident about our future plans and our ability to continue to improve our business. We would like to thank our bond investors for their continued support and of course all of our colleagues who have helped us to make the turnaround happen.”

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