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Creightons profit plummets on higher costs and revenue fall

7th Jul 2023 10:06

(Alliance News) - Creightons PLC on Friday said annual profit fell by more than double on increased expenses and weaker revenue.

The Cambridgeshire, England-based consumer goods company said pretax profit in the year ended March 31 fell 80% to GBP687,000 from GBP3.5 million a year prior.

This partly attributed to distribution costs increasing by 10% to GBP3.9 million, which was driven by increased operational charges at third-party logistics providers and a full year impact of recently integrated acquisitions. Also, administrative expenses increased by 3.3% to GBP18.9 million due to a general rise in overhead costs, in particular in energy prices and insurance costs, Creightons explained.

Revenue was down 4.2% to GBP58.6 million from GBP61.2 million the year before. Creightons attributed this to a 12% decrease in private label sales to GBP22.0 million, due mainly to the non-recurrence of a one-off private contract in the previous year. Creightons added that contract manufacturing sales fell by 13% to 13.8 million.

Creightons declared no final dividend, unchanged from the previous year.

Looking ahead, the company said despite a "challenging year", it is on the "right track", having focused on restoring profit and maintaining a positive cash flow through reducing its cost base. It is well-placed to "proactively manage new challenges and take advantage of any new opportunities that may arise", it believes.

Chair William McIlroy said: "This represented among the most challenging trading years ever faced by the group due to the supply chain and inflationary pressures from the global economic downturn.

"I am pleased to report that we have responded to these challenges and made excellent progress in the second half of the year in returning the business to profitability and positive cash flow.

Our branded business, boosted by the acquisitions in the previous year, has grown to almost GBP23 million."

Shares in Creightons were down 3.2% at 30.00 pence each in London on Friday morning.

By Sabrina Penty, Alliance News reporter

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