Richmond Foods, the UK ice cream manufacturer, is continuing to expand its operations. The group, which last year bought the Nestlé branded ice cream business in the UK, has now bought another, albeit much smaller, ice cream group as part of its ongoing bid to become the country's number one ice cream maker by value.
Richmond is already the country's largest volume producer of ice cream, with a market share of around 21.4 per cent last year, and the addition of Sheffield-based Oldfields Ice Cream should help lift that by a couple more points.
Oldfields specialises in two litre tubs and catering products, and last year registered sales of £5.4 million and pre-tax profits of £0.3 million.
Richmond said it would pay £3.95 million for the smaller company, paid in three separate tranches, completing in June 2004.
James Lambert, chief executive of Richmond, said that the acquisition would help move the company forward towards achieving its strategic goal, although he did not say how much additional volume would be added following the Oldfields acquisition.
Last year Richmond reported sales of £116.7 million (€166.7m) for the year to September, up 32 per cent on the previous 12 months, helped by the addition of the Nestlé business. With the exceptionally hot weather in the summer clearly boosting ice cream sales, the company is expected to announce further gains for 2003.
Furthermore, Richmond still has 18 months or so to run on its £25 million, three-year investment programme designed to facilitate organic growth, improve efficiency, lower costs and deliver innovative products to market - so further acquisitions cannot be ruled out.
In previous years, Richmond has benefited from the changing nature of the ice cream market, with sales moving increasingly away from impulse buying towards supermarket sales, where the company is strongest. The hot weather this year may have shifted the emphasis back to the impulse sector, but the significant upturn in sales should still give a boost to sales.