Canterbury Foods is reviewing its operations in an attempt to prevent 2006 turning into its sixth consecutive year of losses.
The review will be completed next spring and could lead to Canterbury selling some of its operations, said chief executive Paul Ainsworth after he revealed a £11.5m loss before tax in the first half of 2005 with more losses likely in this half. The company suffered a £933,000 loss in the first half of 2004 and a £2.6m loss in 2004 as a whole.
Ainsworth said that key aims were to cut bank debt of more than £18m and to boost sales volumes; turnover in the first half of 2005 was down 12% year-on-year at £20.7m, mostly in Canterbury’s meat products business, which makes mainly burgers and sausages. The business accounted for £2.7m of the overall fall in sales in the first half and for about 57% of the company’s total business, down from 85% three years ago, said Ainsworth. He expected a further decline in demand in the UK for burgers, particularly in schools.
Ainsworth said that Canterbury was now paying an average 20% more for beef and pork than a year ago and was unable to pass on the increase, but that it should benefit from the end of the ban on over-30 month beef. “We should see some easing on the beef prices,” said Ainsworth.
Canterbury said that its pastry business increased its first-half sales by 13% year-on-year and that its small ingredients operation should do better in the second half because customers were beginning to launch products delayed by the Sudan 1 scare.
Canterbury has six UK factories and employs 550 people.