Bakkavor Group plc – the UK’s biggest supplier of supermarket fresh prepared food – is making progress towards its climate target of reaching Net Zero by 2040 after agreeing a £13.3m asset finance deal with HSBC UK.
Bakkavor, which recently reported significant improvement in its half-year results, supplies directly to Tesco, M&S, Waitrose and Sainsbury’s. The company will use the HSBC UK funding to overhaul its network of refrigeration systems, starting with plant replacements at its Sutton Bridge and Boston sites in Lincolnshire and Bo’ness site in West Lothian.
The move forms part of a wider plan to tranform its entire UK network of refrigeration systems. Doing so will unlock considerable energy savings, predicted to support a significant reduction of CO2 emissions.
The new investment is the first significant milestone to follow the launch of Bakkavor’s ESG strategy. Central to its growth plans, the ESG strategy focuses on reducing Bakkavor’s carbon footprint and energy intensity across operational manufacturing, in order to achieve Net Zero by 2040.
Ben Waldron, Chief Financial Officer at Bakkavor Group, said: “Now more than ever is climate action at the forefront of how we do business. On the cusp of COP26, we support UK business efforts – and the food sector in particular – leading the way on tackling climate change. As a manufacturing company, our biggest operational impact on the climate comes from the heating and cooling systems used in our sites, so it’s great to see the next phase of the overhaul of our refrigerations systems get underway, reducing our company’s carbon footprint on the road to Net Zero.
“We’re grateful for the support from the team at HSBC UK as we take this huge step towards achieving this goal.”
Sacha Balachandran, Head of Equipment Finance at HSBC UK, added: “Since the launch of its ESG strategy, Bakkavor has sought to innovate in order to tackle its environmental footprint. This isn’t easy in the refrigerated goods sector, which has a variety of challenges to maintain product quality during production and distribution.
“This funding is indicative of a wider trend in the industry to use technology to find new ways to succeed with low-carbon operations. Bakkavor is right at the cutting edge of that approach.”
Originally formed in Iceland in 1986, Bakkavor entered the UK market in 2001, and now has 37 factories across the UK, US, and China.