Good crop boosts potato supplier Park

POTATO wholesaler E Park and Sons saw a dramatic improvement in its financial performance in the last year as sales surged on the back of a good crop and new contract wins.

The family-owned company, which sources potatoes from farmers in Cheshire, Lincolnshire and Scotland, packages and then supplies them to major supermarkets such as Asda, Nisa and The Co-operative, saw sales rise 18% to £47.8m in the year to the end of June 2009.

A loss of £371,555 in 2008 was wiped out as the group reported profits of £3.07m.

Based near Adlington near Macclesfield E Park, which was founded in 1924, employs around 190 people, the majority of whom are based at its pre-packaged division at Epworth near Doncaster.

In their report directors Richard and Elizabeth Park say: “Sales have increased by nearly 18% during the year, mainly due to the acquisition of another supply contract to a major retail depot in May 2008.

“Raw material prices have been consistently lower than in the previous financial period and this coupled with volume and efficiency savings has resulted in an increase in gross profit percentage from 24% to 33.4%. Distribution costs are markedly higher again due to higher production volumes.”

Looking ahead the company says its major customers, the supermarkets, are “increasingly putting pressure on margins” as they strive to compete with each other on price.

It adds too that each supply contract renewal is becoming increasingly competitive.

Finally the directors warn: “Whilst this season’s crop has resulted in a plentiful supply of potatoes and a resulting drop in raw material prices compared to previous years, the company is aware that any upward trend in costs will have a marked impact on profits.”

E Park said it is taking action to mitigate the impact of price fluctuations by controlling labour costs by investing in new machinery.