According to full-year accounts, which have just been filed with Companies House, the meat processing giant boosted annual sales from £778M to £855M.
However, it posted a pre-tax loss of £16M, a considerable worsening of figures compared with a pre-tax loss of £1.8M in the previous financial year.
In addition, while the company made an operating profit before exceptional items of £1.1M in the year to July 28, 2012, it posted operating losses of £12.4M in the following year.
‘Improve the performance’
“The company has made a loss for the period and a number of initiatives have been implemented to improve the performance in future periods,” 2 Sisters said in a statement about the results.
“As we enter the new financial year, the increase in feed ingredient prices remains a challenge to the business, as it is for many other food manufacturers. The company is working with customers to recover feed inflation and drive volume and invest in capacity and efficiency.
‘New product launches’
“The company continues to invest in new product development, which has resulted in a number of new product launches during the period. The directors regard investment in this area as essential for continuing success in the medium to long term.”
Speculation has been rife for some time that the company had taken on too much with the acquisition of Northern Foods in 2011 and the bulk of Vion’s red meat operations in 2013.
It has been working hard to prioritise investment as it integrates the two businesses at significant cost and has made tough decisions to axe ageing plants. These include its Avana Bakeries site in south Wales and its Solway Foods factory at Corby in Northamptonshire, both set to close later this year.
It is also pumping cash into its added-value chicken processing plant at Cambuslang, Scotland, creating 180 jobs, and its Cavaghan & Gray facility at Carlisle, recruiting 90 more workers there.
In March, 2 Sisters’ parent Boparan Holdings revealed losses had widened to £27.5M in a second quarter trading update, having increased from £12.3M in the same period a year ago.