Food Ingredients is a broad market sector and with major product sectors driven by commodity pricing.
Food Ingredients profile 2015/2016
Revenues were significantly down year on year due to unprecedented commodity price deflation particularly in sugar and dairy. Both these markets experienced record low levels of prices; sugar was impacted not only by weak world prices but also in Europe ahead of the ending of quotas in 2017, while dairy, where quotas have already ended, was affected by the Russian export ban. In this context Garrett Ingredients did well to increase its traded dairy volumes though sugar sales fell slightly.
The acquisition of ISO2 Nutrition generated a modest amount of sales but set-up costs led to a small overall loss in the year. Sales volume was slightly ahead of the previous year at R&W Scott though again price deflation led to a marginal revenue decline. Investment in management teams at both businesses led to higher costs and a decline in EBITDA. Both businesses are now fully equipped to run on a stand-alone basis and develop their growth plans.
Garrett Ingredients is well placed to benefit from any upturn in sugar and dairy pricing and will build sales in sports nutrition. At R&W Scott a number of product initiatives (soft fillings, fruit fillings, sauces, curds, mallows and premium jams) have been developed and are being sold across all channels.
The investment in jam capacity at R&W Scott, which caused some disruption last year, should begin to yield benefits. R&W Scott will also significantly increase its supply into other Real Good Food companies (especially Haydens) facilitated by the central Innovations team.
Food Ingredients includes the following businesses:
Garrett Ingredients sources dairy, sugar and other specialist food ingredients from across the UK, Eire and continental Europe and sells them to large, medium and small food manufacturers across the UK.Visit garrettingredients.co.uk >