Profits fell by almost a quarter at Scotland’s largest egg producer last year.
Accounts for Glenrath Farms Ltd, which is run by Sir John Campbell and his family from its base at West Linton in the Borders, reveal the company posted pre-tax profits of £6.404million for the year ended May 31, 2017.
This is down 21.8% on last year when pre-tax profits stood at £8.190million.
The accounts, filed with Companies House, also reveal a slight increase in turnover to £52.613million, from £51.716million previously.
Egg sales made up the bulk of turnover at £49.111million, while liquid egg sales more than doubled to £2.984million, from £1.263million before.
In his report accompanying the accounts, Sir John said: “I have been long predicting the financial downturn in the industry and I do feel in the present economic climate and market circumstances this is a very good result.
“In the market place, competition has grown considerably, with many smaller packers being very competitive in the market place, going direct to the supermarket with offers, which in return reduces prices. I anticipate this practice will continue.”
He said the company had recently converted one large laying house from colony to barn production at “considerable cost” and it was now in the process of securing orders for barn production.
“Going forward I believe the UK shell egg market could well move to free range only after 2025 when colony egg production will cease,” added Sir Campbell.
“A major food manufacturing company have intimated they will cease trading cage eggs in Europe by 2020. We are reacting to this situation.”
He said the business had introduced white hens to produce white eggs in some colony houses – a move not yet supported by industry, however one large supermarket has agreed to introduce white colony eggs.
“I am confident others will follow,” added Sir John. “This innovation in turn will help to speed up the industry conversion from colony to barn-free range eggs.
“I forecast that the egg processing industry will still require cage egg production in the future.”
Sir John said the company’s contract model for free-range egg production was progressing well, through the use of experienced stockmen to look after free-range hens.
“This model is not unlike the massive Moy Park Broiler Scheme in Northern Ireland,” he added.
“I believe this is a win-win situation for many farmers and our company. A very good investment model going forward – Glenrath intend to expand this model in the future.”
On future plans, Sir John said: “We are in the final stages of modernising all our production, packing and processing facilities. We believe we have the most modern and efficient facilities in the UK.
“I am very pleased to report that three members of the third generation of Campbells are assuming managerial roles within the company. It is indeed a great honour to lead this successful family farming company.”
Glenrath produces a range of different eggs including Cage Free, Big and Scottish, Glenrath Eggs, Kitty Campbell’s Free Range Eggs and Glenrath Double Yolkers.
According to the accounts, it employed 216 staff in the year. The highest paid director took home a pay cheque of £161,875 – down from £211,475 before.