New finance deal for Fakenham chocolate manufacturer
The parent company of Fakenham-based chocolate manufacturer Kinnerton has agreed a new finance deal giving it access to �45m of cash.
Zetar, based in London, has agreed the deal with HSBC after its banking facility was coming up for renewal with its previous bank.
Mark Stott, finance director at Zetar, said the cash would provide the group with strong working capital to meet the firm's organic sales growth plans for the next four years.
Due to the seasonal nature of the business, especially Kinnerton, which makes advent calendars and Easter eggs, it has to produce a lot of stock before it is needed, which needs to be funded.
Mr Stott also said the firm had outgrown its previous facilities, arranged four years ago.
'Zetar as a group has been growing by seven to 10pc for the last few years,' he said.
'Our working capital requirements grew with that growth. Kinnerton does manufacturer a lot of product for seasonal events and in order to smooth out the work flow we are producing products for Easter and Christmas throughout the full year, for which we need working capital.'
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Kinnerton was the first company bought by Zetar when it was founded five years ago and it remains the largest firm in the group.
It accounts for just over 50pc of the group's turnover, said Mr Stott, and is in full production most of the time.
The group recorded sales of �132m in its last set of filed accounts and analysts predict it to reach �140m in the coming year.
Mr Stott said the outlook for Christmas 2010 and Easter 2011 was 'as good, what we would expect sales to be'. 'Business, in the market place that has been fairly flat, is achieving growth.
'We have got a number of exciting licences, including Toy Story 3.'
The firm produces 25m Easter eggs per year, making it the fourth largest Easter egg manufacturer after Mars, Nestle and Cadbury, and it produces the chocolate advent calendars in the country.
It also produces own brand chocolate for Marks & Spencer, Tesco and Sainsbury's.
It employs between 600 and 1,000 people depending on the season.