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Inflation to take a bite out of Mackie’s profits this year

L-R Karin, Mac and Kirstin Mackie.
L-R Karin, Mac and Kirstin Mackie.

Mackie’s of Scotland has said it expects continuing costs increases to hit profits this year.

The Aberdeenshire family business, famous for its ice-cream, has reported “strong” sales to major retailers this year but is still forecasting lower profits due to the impact of rising inflation.

The company now plans to focus on further export growth in Asia and improve product ranges to counter challenging times ahead due to increased production costs.

Managing director Mac Mackie was speaking as the company unveiled its latest financial figures for last year.

Lower profit forecast

He said: “For the current trading year, sales to our major retailers remains strong, but overall company performance will be affected due to continuing cost increases, and profit is forecast to be lower than in 2020/21.”

The fourth generation family farm, Westertown is powered by renewable energy and started producing ice cream in 1986 and still produces it using milk and dairy from its own herd.

The ice cream is distributed to the UK and worldwide.

Growth in the UK premium ice cream market saw a 40% increase in sales in England and Wales while its range of chocolate bars saw a 15% uplift in UK sales.

Mackie’s of Scotland has launched its own online store

Figures revealed turnover increased by 11% to £18.5 million, up from £16.7m, while operating profit rose by 19% to £4.1m compared to £3.4m in the prior year, according to annual accounts to the year ending 31 May 2021.

Mr Mackie said: “Against a backdrop of the pandemic’s impact on consumer confidence and rising production costs, we are very pleased to have delivered a robust performance and positive financial results which show steady growth for the eighth consecutive year.

“Our focus for the current year will be to build on the improvements that we have made to our production plant and systems to deliver increased output volume, improved quality, and greater cost control and efficiency throughout the business.”

Job losses due to Covid

While turnover and profit increased there was a drop in staff numbers with the team at Mackie’s 19.2 parlour, based in Marischal Square, almost halved to six due to less trading during the pandemic.

Staff numbers at the farm has increased to 95, with nine new hires, in order to cope with increased production,

Mackie’s continued to invest in its biggest ever project – a £4.5m innovative low carbon refrigeration facility.

Supported by the Scottish Government’s Low Carbon Infrastructure transition programme, it is due to complete this spring and should enable a reduction in energy use of up to 80%, contributing to the company’s objective of being 100% self-sufficient in renewable energy.

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