Transformation programme yielding rewards as McBride returns to profit

McBride, the Manchester-based manufacturer and supplier of private label cleaning products, achieved a storming return to profit, and still managed to cut net debt by £35m, its annual figures for the year to June 30, 2024, revealed today.

Revenues rose by 5.2% to £934.8m, and a £15.1m pre-tax loss last year was transformed into a pre-tax profit of £46.5m.

Net debt now stands at £131.5m.

The business aid its overall market for private label household cleaning products continues to grow and it enjoyed a good performance in strategic focus areas of laundry and Germany, which saw sales volume growth of eight per cent and 6.2%, respectively.

There was a strong second half recovery in contract manufacturing, with the early start of a new long term contract, and all divisions delivered profit growth, building on the momentum of 2023.

The group’s transformation programme is progressing to plan, it said, and on track to deliver £50m of net benefits by 2028.

McBride said it maintains a positive outlook for continued profitable growth.

The early months of the new financial year are seeing overall sales volumes in line with expectations, as well as encouraging signs of continued contract manufacturing momentum, building on a strong second half.

There is also a healthy pipeline of new launches and business wins, as the group prioritises growth initiatives.

Input costs for the main raw materials remain steady, with costs of recycled materials and natural-based chemicals increasing in line with expectations.

The group full year outlook is consistent with current market expectations – adjusted operating profit of £59.7m and net debt of £111.3m – targeting a third consecutive year of revenue growth, with profitability significantly ahead of the historical average.

Chief executive, Chris Smith, said: “It has been an excellent financial and operational performance by the group.

“While market dynamics have remained favourable, with a continued consumer trend towards private label across European household cleaning product markets, it is the effective execution of our strategy that has led McBride to capitalise on this environment.

“Our efforts to further develop our customer partnerships, together with improved consumer insights to support product range developments and innovation led by our specialist divisional teams, will continue to drive future growth.”

He added: “Strong operational delivery, focused growth initiatives, and effective cost and margin management, have led each division to generate profitable growth for the year, resulting in the group’s significantly increased adjusted operating profit, slightly ahead of the upgraded market expectations.

“In addition, our commitment to reducing debt levels has led to a £35m reduction in net debt for the year.

“The Transformation programme is progressing to plan, with a number of key projects moving from design to delivery phase in 2025.”

And he revealed: “The group has made an encouraging start to the new financial year and while there are signs of increased brander activity, private label demand remains robust with contract manufacturing maintaining the momentum of the fourth quarter. As such, we look forward to the future with confidence.”