Finance team of the year - business: Innocent Ltd
Innocent’s finance team has put in place a strategy to ensure what it is doing is in line with overall strategy
When you have multinational heavyweights Nestlé and PepsiCo muscling in on
your turf, you had better hope you have a finance team up to the challenge.
Smoothie maker Innocent Ltd was faced with this scenario in 2008. What did it
do? According to finance director James Davenport, a lot.
The team pulled together and came out on top, ending the year crowned the No
1 smoothie brand of the year.
This year’s Accountancy Age Finance Team of the Year spent the year chalking
up a number of runs on the board, notably attracting a £30m equity investment
from Coca-Cola.
Preparation for the deal included the presentation of a 220-page business
plan, dealing with 18 potential investors and 13,000 pages of due diligence and
the completion of financial statements, two months early.
Judges noted Innocent’s use of people power, making the most of their team’s
talents. “The Innocent entry demonstrated a real team effort and a strong
emphasis on people, a shared vision and drawing the team together,” they said.
The financial management team also helped to recoup R&D tax credit for
seven years, bringing in £350,000. In the background the company also introduced
rolling monthly forecasts and quarterly balance sheet reviews, along with “year
to date ¬ year to go” reporting in conjunction with risks and opportunities.
It’s not so surprising that when the company asked employees, in its
twice-yearly company-wide survey, whether they had access to the right finance
information, services and advice to do a great job, the score jumped from 3.46
to 3.85, where 1 is strongly disagree and 5 is strongly agree.
Cash management was another area where Innocent achieved great things.
Keeping a keen eye on where the prevailing winds blow, the finance team saw that
banking covenants would be severely stretched by autumn 2008.
The team put together a plan aimed at managing covenant breaches without any
restrictions on the company’s ability to operate as desired. It also excelled in
working capital management, resulting in a £5.5m net cash inflow from operating
activities despite an operating loss of £8m.
It also put together a European cash management process which enabled
cross-border cash management through a single process.
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WORKING AS A TEAM
Innocent’s finance team has put in place a strategy to ensure what it is
doing is in line with overall strategy.A clear line of sight links the company’s
objectives with the numbers’ men.
