Maggie Beer brings Paris Creek Farms back into the fold
Maggie Beer Holdings will take previously-for-sale Adelaide Hills dairy producer Paris Creek Farms off the market and back into the broader company, with the move to deliver around $17 million in extra revenue.
The subsidiary of Adelaide food producer Maggie Beer Holdings will be ‘reclassified as a continuing asset’ having been held for sale by the parent company for nearly a year.
Paris Creek Farms, a South Australian bio-dynamic and organic dairy producer, will resume its position in the Maggie Beer portfolio which also includes the eponymous fine foods brand founded by the local culinary icon and Hampers & Gifts Australia.
It follows a push by MBH away from the dairy segment, with the company appointing advisors in June last year to come up with a plan for its underperforming dairy businesses Paris Creek Farms and Saint David Dairy.
The latter was sold in September 2022 to Goulburn Valley Creamery following a rough trot in the second half of the financial year for the divested company, primarily due to skills and labour shortages which caused the loss of some customers according to MBH.
Unlike Saint David Dairy, Paris Creek Farms was never acquired but Maggie Beer Holdings is keen nevertheless to reintegrate the dairy brand into the broader firm as a workhorse for the company’s renewed ambitions in the dairy space.
“The decision to reclassify PCF comes as a result of a detailed strategic review undertaken by the board and management that included the viability of upgrading the PCF facility to expand its dairy product making capabilities, and specifically its potential value as an internal asset for the manufacture and supply of Maggie Beer Products including the strategically important cheese products,” MBH said.
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“The board has determined that with modest capital expenditure, the PCF facility is able to be upgraded and utilised as a financially and operationally sustainable dairy manufacturing asset.
“In the context of the company’s growth ambitions in this category, the decision for PCF remaining a core asset within the MBH Group has strong economic and strategic rationale.”
Further, the company said the reclassification of PCF as a continuing asset would result in additional revenue of between $16 million and $17 million for the financial year ending 30 June.
However, as a result of the reintegration, earnings for FY23 will likely be negatively impacted by a reduction in the range of $1.3 million to $1.5 million.
New CEO Kinda Grange said the Paris Creek Farms business was ‘strategically important’ to the firm’s growth ambitions.
“As I came into the business and looked at the categories that we operate in, what stood out was how attractive the dairy category is,” Grange told investors this morning.
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“The consumer demand for premium dairy continues to grow, so it is an attractive category for us to be in.
“When I look at the Maggie Beer brand, we have proven our success in dairy – the specialty cheese segment for the Maggie Beer brand in supermarkets is actually our largest category. We are consistently attracting a loyal and premium customer base.”
New CEO ‘re-imagines’ Maggie Beer
Alongside the strategic pivot to maintain ownership of Paris Creek Farms, CEO Grange today outlined her vision for the future of Maggie Beer Holdings having joined the firm in March this year.
Grange, who counts joint managing director Australia at Goodman Fielder on her resumé, hopes to expand Maggie Beer’s remit beyond food and into the home, today announcing plans to add home wears and gardening tools to the brand’s line-up of products.
It is an ambitious pivot from the pâtés and verjuices that founder Maggie Beer crafted her legacy around, but one that makes sense considering the South Australian entrepreneur’s reputation according to Grange.
“I’ve reimagined the Maggie Beer brand from an iconic food brand to an iconic food and lifestyle brand in Australian kitchens, homes and gardens,” Grange told investors.
“If you have Maggie’s cookbooks you’ll see that there’s always a big nod to the garden and using seasonal produce, and this is a great way for us to share Maggie’s favourite gardening products with our loyal customers.
“In the ‘good life’ pillar we will enter new verticals continuing to build on the recently launched Maggie Living range and will be focused on the kitchen, the home and the garden. Those categories online present an opportunity of over $5.8 billion.”
In addition to the expansion of the Maggie Beer brand beyond the kitchen, Grange said existing product line-ups will receive new additions too including more pastas, cheeses and ice creams.
For the CEO, the ultimate vision for MBH under her leadership is to “champion the joy of Australian food, culture and gifting”, with aims to “create a $300 million net sales revenue business with strong margins and return on assets” within five years.
“We have a market leading brand, scalable and fit for purpose manufacturing assets and strong e-commerce platform,” Grange said.
