Sales fall ends more than 15 consecutive years of growth at Symington’s

FOOD manufacturer Symington’s has maintained its bottom line through a tough trading year affected by the costs of internal restructuring, price pressures within the UK supermarket sector and the cost of EU regulations.

But a 5% fall in sales in the year to March 1 ended a run of more than 15 consecutive years of revenue growth that has seen the Leeds company, which produces food under a range of brands including Aunt Bessie’s, Ragu and Ainsley Harriott, grow eight-fold since the turn of the century.

Symington’s employs more than 800 people across its eight sites, including five in West Yorkshire, and one each in South Yorkshire, County Durham and Australia.

Although pre-tax profits slipped slightly, down 3% to £4.8m, and revenues fell 5% to £141.3m, its underlying trading performance was better shown by its EBITDA figure, which was down 17% on 2014 and 23% below 2013.

A “significant restructuring” of the business created one-off costs of £910,000, while the impact of EU food packaging regulations also produced £970,000 of exceptional items.

Finance director John Kitson also pointed to the “well-publicised difficulties” of the UK food retailers, which has seen the hard discounters Aldi and Lidl gain market share while also forcing the established supermarkets to increase promotional activity.

Symington’s invested £2.7m on capital expenditure, which included a new noodle manufacturing facility in south Leeds and an extension of its nearby Cross Green warehouse that has added 6,000 pallet spaces and will deliver a “large reduction” in external storage costs.

It also bought North East company Tanfield Food – now Symington’s Consett – which will enable the company to move into the “free from” category through gluten-free brand Ilumi, although in the short-term it increased costs. However it is expected to be profitable in the current financial year and beyond.

The board also expects its Australian business to continue to increase sales, while product innovation and improved manufacturing performance will help to produce “modest year on year growth” in 2015/16.