Food giant Northern back in profit
NORTHERN Foods is to invest £26.5m in automated technology at its Fox’s Biscuits factories to remain at the top of its game in a competitive environment.
The company, which produces food including Goodfellas pizzas, Fox’s Biscuits and Matthew Walker Christmas puddings, said that around 200 jobs would be lost at its sites in Kirkham in Lancashire, Batley in Yorkshire and Uttoxeter as a result.
Northern Foods said that the technology would fix current “pinch-points” and help it move from three sites to two world class facilities, which will further enhance the competitive position of Fox’s Biscuits.
This project is expected to generate a return on investment in excess of 20%.
Based in Leeds, Northern is a major employer in the North West. As well as the Fox’s factory in Kirkham it makes ready meals in Carlisle at Cavaghan & Gray and owns the famous Hollands Pies factory in Baxenden near Accrington.
The manufacturer, which today announced a return to profit in the six months ended September 26 to £7.2m from a loss of £8.1m a year ago, said that its third ‘Vinnie’ campaign had helped drive brand share to its highest level since 2006.
Total sales for the period were £466.9m compared with £468.6m last year, which reflected the mothballing of its Fenland operation last year.
Northern Foods said that demand continued to be robust with like-for-like sales growing by 2% led by chilled and bakery.
The chilled division has seen strong sales growth driven by new discount lines in sandwiches and salads although this in turn has “dampened” margins.
The closure of its Hull ready meals site, which was announced in May, has impacted sales reflecting lower customer orders during the wind-down phase.
Northern said that market conditions remained competitive but that the firm was entering the second half in a solid financial and operating position.
Chief executive Stefan Barden said: “Our business is stable, balanced, and benefiting from management actions taken to improve our performance.
“We have many opportunities to drive shareholder value over the coming years and today we are announcing a significant investment in Fox’s Biscuits, which will enhance its profitability and provide competitive advantage.”
