Pandemic sliced a third off Filta Group earnings

Filtafry crop
Filta Group is positive about future trading prospects.

Filta Group, the provider of fryer management and other services to commercial kitchens, has given a sneak peek into its finances ahead of the group’s full year results for the year ended 31 December 2020, which it intends to announce on 20 April 2021.

Despite the pandemic’s impact on the restaurant and leisure sectors, the group was able to demonstrate the resilience of its model and expects to report adjusted EBITDA in the region of £1.0m (2019: £3.2m), from revenues which were approximately one third lower than the £24.9m achieved in 2019.

The group introduced efficiencies in the last quarter of 2019 and, through close attention to spending through 2020, reports it has achieved a small improvement in gross margins and a £1.4m reduction in overhead spending.

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Filta feels it took quick, decisive action to meet the challenges of the Covid-19 pandemic, with the principal focus being on the preservation of cash. With the benefit of delivering positive EBITDA, the group’s operations were cash neutral. Having utilised the available government support schemes, the net debt (excluding lease liabilities) has reduced from £0.9m to £0.5m during the year, leaving the company with a gross cash balance of £4.2m at the year end.

In the UK, margins have reportedly greatly improved as a result of the reorganisation and efficiency measures introduced at the end of the previous year. The group’s major UK customers are yet to re-open and, in consequence, business levels are at approximately 60% of pre-Covid levels.

However, looking to the future, Filta has invested in building its UK sales teams in order to achieve closer relationships with its key customers. It reports that as a result, the business has seen an increase in sales activity and have developed a strong sales pipeline. Additionally, Filta’s new GM Cyclone grease interceptor is said to have been well received by the market and its FiltaShield products continue to register sales in the UK, US and Europe.

The effects of the pandemic have had a greater impact on its trade in Europe, where it is taking longer to return to normal market conditions. However, Filta’s operations in Europe make up less than 3% of the group’s revenue and therefore it states its exposure is minimal at this stage, but the company remains positive about European opportunities and believes that by maintaining a strong foothold it will be well-positioned for rapid future growth.

CEO of Filta Group, Jason Sayers, said: “We are strongly encouraged by the performance of the group during undoubtedly very challenging times. With the rollout of vaccine programmes making excellent progress, particularly in the UK and the US, the restaurant and leisure sectors are expected to open up as we approach the summer months.

“As a result of the proactive measures we implemented early in the pandemic, the group has a robust balance sheet and we believe we are coming out of this period as a more efficient organisation and with an exciting sales pipeline.

“The OECD has predicted UK and US GDP growth for 2021 of 5.1% and 6.5% respectively and we expect trading to continue strengthening as we go through 2021. With markets expected to be fully open and back to pre-pandemic levels by next year, we look forward to further growth through 2022 and beyond.

“Once again, we would like to express our gratitude to all Filta staff and franchise owners during these challenging times and encourage them to look forward, as we are, to the brighter future on the horizon.”

Tags : businessfiltafilta groupfinancial resultsfinancials
Clare Nicholls

The author Clare Nicholls

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