Brexit and weak pound take toll on jam maker
Brexit uncertainty and weakened sterling have forced family-owned food manufacturer F Duerr & Son, the south Manchester maker of jams, table sauces, peanut butter and marmalades, down the path of currency hedging.
The strategy was revealed in the company’s accounts for the year ended March 31, which showed profits fell from £3.3m in 2016 to £2.7m and turnover fell slightly from £64.9m to £64.7m.
In a report accompanying the accounts, company secretary A J Collinson said: “The company operates in a highly competitive market and the climate remains challenging for all businesses.
“The economic conditions continue to produce an increased risk of business failure.
“The company has successfully continued to balance its expose to risk by winning new business, retaining current business and controlling costs.”
The statement went on to say the majority of Duerr’s were conducted in pounds sterling, but “there is limited exposure to the Euro and US dollar, and in order to minimise the company’s exchange rate risk the directors have invariably entered into currency hedges for the exchange rate exposure which is not covered by income and expenditure in these currencies.”
It added: “During the financial year, the impact of Brexit unexpectedly weakened sterling and there was a reduction in profitability as a result of this.”
However, the company has a positive cash flow of £4.5m (2016: £5.6m) from operating activities as a result of continued profitability, and a reduction in stock and trade debtors.
The company employs 243 and total staff costs amounted to just above £9.1m. Total directors’ renumeration amounted to £904,635. It’s highest paid director received £169,040.
TheBusinessDesk has contacted Duerr for comment.
