Higher costs dent margins at Halewood
DRINKS producer and importer Halewood International has seen profits shrink as competition and higher costs eat into margins.
The Liverpool-based group, which employs 1,285 staff in the UK and overseas, produces own-label drinks and distributes brands such as Lambrini, Lamb’s Navy Rum and Tsingtao.
Recently filed accounts of Halewood International, which contain details of the group’s UK business, show it recorded a pre-tax loss of £5.1m in the year to June 2008, up from £4.4m last time. Sales grew by 1.8% to £142.5m.
Group figures, held within Halewood International Holdings’ accounts, show pre-tax profits dropped from £5.2m to £1.5m on sales of £226.7m, up from £224.4m.
In both sets of accounts the directors blame lower earnings on tough competition and higher raw material prices.
They expect these conditions to continue but said the group’s focus on product development and its geographical spread should insulate it from the downturn.
Graham Oak, marketing director at Halewood International, told TheBusinessDesk: “Here at Halewood, innovation is the life blood of our business. We are always looking for ways to innovate and have done so recently with the launch of Crabbie’s Alcoholic Ginger Beer – an industry first, Lambrini Rose and Lamb’s Spiced Navy Rum, all of which are creating a real stir in the market at the moment.
“Whilst continuing to lead from the front, we have also ensured that our cost base is managed to create greater efficiencies within the business; plans for which are well underway including the introduction of an automated packing line which was announced earlier this year”.
During the accounting period the business invested £2.5m in a new bottling plant at its headquarters in Huyton.
Despite pressure in the UK the group has seen strong growth at its South African operation where operating profits rose by £900,000. It also has interests in Romania, including vinyards.
The privately-owned group is controlled by John Halewood, a horse racing enthusiast who won the 2004 Grand National with Amberleigh House.
