Company Reports & Accounts
By Roger Dean
H.G Gladwell & Sons Ltd The principal activity of the company during the year ending 31 March 2020 was that of pet and animal food manufacturers, retailers and distributors. The company’s board of directors were pleased to report another encouraging year of turnover growth, achieving a volume increase of 4 per cent while at the same time slightly improving the gross margin percentage. The directors also noted that ‘the essential nature of animal feed has meant that at the time of reporting, the company’s performance has not been adversely affected by the Covid-19 pandemic’. The company reported sales of £26.86 million in the year under
review, an increase of £1.04 million or, as previously mentioned, 4 per cent over the previous accounting period. Reflecting a lower increase in direct costs, Gross Profitability rose to £3.94 million in the year under review, an increase of £280,000 or 7.7 per cent. There was, however, a sharp rise in administrative and distribution costs in the year to March 2020 which resulted in an increase in indirect costs from £3.66 million to £3.78 million. As a result, operating profits fell during the year under review from £297,000 to £160,000. Pre-tax profits, which during the year prior to the accounting period had amounted to £225,828, fell to £85,329. The company’s Gross Profit ratio, which had fallen from 15 per
cent in the 2017 accounting year to 14.2 per cent in the two succeeding accounting years, improved to 14.7 per cent in the year under review. This was a reflection of high raw material costs in 2018 and 2019 which feed manufacturers are frequently unable to recover in full. In 2019/20, with the easing of feed material costs, Gross Profit ratios were showing signs of improvement. Mr M G J Gladwell and Mrs Y L Gladwell are the controlling party by virtue of their control of the majority of the voting rights.
Humphrey Feeds Ltd The principal activities of the company during the year ending 29 February 2020 were the production and marketing of animal feeds. During the year, the company generated revenues of £35.77 million,
£684,000 or 1.9 per cent less than during the previous accounting period. Direct costs fell by £586,000 or 1.8 per cent; the Gross Profit ratio, at 9 per cent, was at its lowest level since 2010, suggesting that the company was experiencing high raw material costs that it was not able to recover fully in the market place. This was in marked contrast to the 2016 and 2017 financial years when the Gross Profit ratio averaged 12.1 per cent. Pre-tax profits in the year under review amounted to £992,000, giving a pre-tax profit ratio of 2.8 per cent against a five-year average of 3.6 per cent. The company’s parent company is Humphrey Farms Ltd. The
company is ultimately controlled by members of the Humphrey family by virtue of their majority shareholding in the ultimate parent company.
PAGE 22 NOVEMBER/DECEMBER 2020 FEED COMPOUNDER
ForFarmers Ltd A July to September trading statement from feed manufacturer ForFarmers UK Ltd shows that UK feed volumes were down year-on- year for all species, but that the rate of decline was slower than during the first half of 2020. UK ruminant feed volumes were under pressure during the period,
reflecting declining demand for dairy feeds as the food service and catering sectors used less milk and dairy products due to coronavirus restrictions. Good summer grass growth also meant reduced need for supplementary feeding. Beef feed volumes continued their downward trend during the quarter while the company’s pig feed volumes fell slightly as the company continued to focus on more profitable customers. ForFarmers’ overall UK margin per tonne declined ‘because of a temporary deterioration of the product mix’.
AB Agri Associated British Foods’ latest full-year results show that the company’s Agriculture division, AB Agri, maintained profitability and revenues at the previous year’s level, despite the effect of Covid-19 restrictions on demand for animal feeds during the period. The division made an operating profit of £43 million on revenues of
£1.40 billion in the year to September 12th 2020, compared to £42 million and £1.39 billion in the previous year. Feed sales were lower across the group’s UK volume feed businesses: ABN, KW, and Trident. The division notes lower sales prices consequent upon reduced raw material costs over most of the period. At the same time, new customer business only partially offset falling
compound feed demand as milk and livestock customers reacted to the sudden decline in milk and poultry meat volumes from the food service and catering sectors in the spring and early summer consequent upon the Covid-19 lock-down. Of the specialty feed businesses, sales and profits at the international feed enzymes business, AB Vista, were described as ‘strongly ahead’ of the previous year, buoyed by good sales growth in the Americas and the first full year’s contribution from the newly acquired Signis animal digestion aid business. However, AB Vista’s growth slowed in the second half of the financial year as customers either reduced overall feed production volumes or their feed enzyme inclusion rates, as food service demand slowed in lockdown. The company reported that the new Premier Nutrition pre-mix feed
facility in Staffordshire was now fully operational and that AB Agri’s Spanish and Danish feed businesses had a ‘particularly strong’ year, while the 2019 acquisition of the Polish starter feed business, currently operating as Primary Diets Polska, also performed well. The division’s Chinese feed business saw higher profitability in line with lower feed material prices and tight attention to cost control. The growth of the company’s beef and sheep feed volumes in China is also reducing reliance on the pig sector which was continuing to suffer from the outbreak of African Swine Fever in 2019 which significantly reduced pig numbers. The company reported that ‘revenues and adjusted operating profit at AB Agri were in line with last year’ and that when Covid-19 appeared in the company’s markets, the business reacted ‘swiftly and effectively’ to ensure employees’ safety and the continued availability of animal feed to the company’s customers.
Comment section is sponsored by Compound Feed Engineering Ltd
www.cfegroup.com
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68