28th Nov 2024 11:15
(Alliance News) - Creightons PLC on Thursday said profit surged nearly six times higher in the first half of its current financial year, due to reduced expenses.
The Peterborough, England-based beauty and wellbeing consumer goods manufacturer said pretax profit for the six months that ended September 30 was GBP1.7 million, multiplying from GBP302,000 the year before.
This was primarily due to cost of sales reducing by 4.5% to GBP15.2 million from GBP15.9 million, while administrative expenses were down 5.5% to GBP8.8 million from GBP9.3 million as a result of the completed integration of its Emma Hardie subsidiary into the group.
Distribution costs also decreased 30% to GBP1.4 million from GBP1.9 million, due to the group beginning to package its finished goods in-house rather than outsourcing to third-party providers.
Revenue, however, fell 1.8% to GBP27.1 million from GBP27.6 million last year, due to cost reduction efforts and stock-keeping unit rationalisation.
Its branded product revenue was down 15% to GBP8.9 million from GBP10.4 million, while contract manufacturing revenue declined 25% to GBP3.8 million from GBP4.9 million.
Managing Director Philippa Clark said: "The next 6-12 months will see more new product development being delivered to support private label sales growth, but also to reverse brands which have declined in a focused drive back to growth. This will include a number of exclusive brand extensions with key retail partners in order to compete with 'dupe' product offerings, alongside strategic new developments for long-term brand growth.
"The group calculates that the annual impact of the budget announcements will total GBP600,000, with increased national insurance costs of GBP400,000 and the increase in the national minimum wage of GBP200,000. There will also be an additional impact on pay differentials that will need to be managed.
"The management team are in the process of identifying and implementing detailed plans to mitigate the impact. This will include the need to re-negotiate prices with our customers where possible, product re-engineering, reviews of working practices to streamline processes, including utilising technology and key operational investments, where appropriate."
Shares in Creightons were down 16% at 33.17 pence in London on Thursday morning.
By Emily Parsons, Alliance News reporter
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