War and cost of living crisis hits Bolton baker Warburtons as profits fail to rise

Bolton-based bakery business, Warburtons, saw sales rise, but pre-tax profits fall, in the year to September 24, 2022, impacted by Russia’s invasion of Ukraine in February last year.

Results filed at Companies House show turnover at the family-run group hit £605.741m, compared with £567.903m the previous year.

However, pre-tax profits of £13.380m have dropped from the £23.548m figure in 2021, due to commodity inflation and a driver shortage.

Raw materials and consumable costs increased from £171.029m the previous year to £198.776m in 2022, while staff costs also rose to £226.699m from £214.531m the prior year, despite a fall in average staffing numbers, from 4,941 in 2021 to 4,906 in the reporting period.

Fifth generation chairman, Jonathan Warburton, explained in his report notes, that the group was hit by the “ongoing supply and distribution challenges” seen across the nation.

He revealed that the Ukraine conflict has resulted in inflationary costs in wheat, energy and fuel, particularly in the second half of the financial year.

Mr Warburton also said: “The cost of living crisis across the UK continues to impact the market and the company continues to monitor this impact.”

He added: “Volumes remained strong during the year driven by strategic customer partnerships and new product introductions, supporting a 6.7% increase in turnover.

“The company also experienced a step up in costs, together with higher costs to secure service to customers during the period of driver shortages.

“The company continues to focus on the quality of product and service supported by the ongoing development of new product ranges.

“Investment is focused on enhancing our capability to meet changing consumer trends and deliver productivity. This continuing innovation and investment in new capability will ensure we are well placed for future progress.”

The accounts revealed that the group’s directors took a pay cut during the year. The total paid in 2021 was £4.606m, which fell to £4.273m in 2022.

The highest paid director received remuneration of £1.716m in 2022, down from £1.939m the previous year.