Expanded operations in the US have helped Fochabers-based Baxters Food Group increase sales and profits, despite tough trading conditions in the UK.
The boost to the group’s figures from its 2014 acquisition of Wornick Foods, in Cincinnati, was highlighted yesterday by executive chairman and chief executive, Audrey Baxter, as its latest financial results were revealed.
Turnover at the family-run business rose 10% to £248.6million in the 10 months to April 2, last year, compared to the previous full financial year, according to accounts lodged with Companies House by its parent W A Baxter & Sons (Holdings) Ltd.
The Moray company, famous around the world for its soups, sauces and jams, also saw pre-tax profits before exceptional items rise to £14.9million from £11.7million in the same period. Earnings before interest, tax, depreciation and amortization (EBITDA) increased to £23.1million from £19.4million.
In a statement on the results, Ms Baxter, who returned to the chief executive’s role in 2015, said: “The past 10 months have been a successful period and demonstrate the continued positive impact on group performance from our expanded operations in the USA following the acquisition of Wornick Foods in 2014.
“Across the remainder of the group the volatility of food retail markets particularly in the UK and Canada remains a challenge. Market pressures including food deflation, changes in the retail environment and continued consumer focus on promotions all present challenges and opportunities. The board and management team remain committed to developing our business to capitalise on these areas.”
In her forward to the accounts Ms Baxter noted that the impact of Brexit has been “generally positive” for the group.
In her statement, she added: “Foreign exchange movements have a greater impact on the group’s results with the relative strength of sterling adversely impacting results in the 10 month period. Conversely, the weakening of serling subsequent to the period end has been generally positive for the group reflecting the significant proportion of our activities and revenues now generated outwith the UK.”
In the 10 months to April 2016, the average number of employees at Baxters was 1,539, compared with 1,600 the previous year. The figures show the company’s spending on raw materials and consumables increased by £1.4 million to £8.9million in the period.
The company said it had changed the end of its financial reporting period to enable the business to co-ordinate results by calendar quarter.
The results show the company paid a dividend of £1million to its owners in 2016, which was half that awarded the previous year.