Ornua Foods UK issues financial report
The company said it delivered a satisfactory trading performance with turnover up by 10%, reaching £354m ($446m) corresponding to a sales volume increase of 10%. Ornua Foods UK said this reflects its commitment to following a clear and consistent strategy to deliver stability in a challenging and volatile market environment.
Business strategy focused on driving continuous improvement, delivering best in class category expertise and support to customers, building a strong own-label and branded product portfolio and optimising experience in dairy commodities.
The results for the company show a pre-tax profit of £4.1m ($5.2m), compared to £6.8m ($8.6m) in 2018.
Ornua Foods UK said 2019 saw investment in a business transformation program, which led to a reduction in profit for the year but will be instrumental in driving future efficiencies and economies of scale for the business. The past year has also seen reduced returns from traded commodities, which were largely offset by a strong underlying performance in the core business, the latter being driven by a better customer mix, branded sales and an ongoing focus on rigorous cost control and efficiencies. The full year effect of several new business wins in 2019 and the capital investment programs undertaken is expected to be reflected in future years.
The company has net assets of £35.7m ($45m), up 12.3% at the balance sheet date.
During 2019, the company continued to invest in capital expenditure and marketing. Capital expenditure included further investment in cheese cutting and packing technology and a strategic investment in a systems upgrade. In addition, the business continued to invest in multi-channel marketing campaigns for its Pilgrims Choice and Kerrygold brands.
Bill Hunter, managing director of Ornua Foods UK, said, “The 2019 financial results reflect a strong underlying performance in our core business. This was driven by a better customer mix, branded sales and an ongoing focus on rigorous cost control and efficiencies. While the full year effect of several new business wins secured in 2019 and the major investment made during the year in a business transformation program will be reflected in future years.
“Looking forward, we believe that our ongoing investment in both our state-of-the-art packing facility in Leek and our Pilgrims Choice and Kerrygold brands will continue to give the company a competitive advantage in the marketplace.”
The new financial year has witnessed the COVID-19 pandemic.
Operationally, Ornua Foods UK said its biggest challenge is to keep its supply chain operating to ensure markets remain open to serve its customers at a time of uncertainty. The demand for core retail customer cheese and butter lines has been strong and the company said its business has been able to maintain its service and quality levels.
Hunter added, “In the light of COVD-19 our key focus has been to do everything we can to ensure the health and wellbeing of our staff. At the same time, we have taken steps to build as much resilience as possible into our business operations and supply chain.
“To date, demand for our core retail cheese and butter lines has been strong. I’m also pleased to be able to report that, thanks to the hard work and commitment of our staff, allied with the close collaboration and support of our customers and supply partners, we have been able to maintain our service and quality levels.”