Pinneys closure costs Young’s £11m

By James Ridler contact

- Last updated on GMT

Young's sale of Pinneys in Scotland cost the manufacturer more than £11m
Young's sale of Pinneys in Scotland cost the manufacturer more than £11m

Related tags: Meat & Seafood

The closure of the Pinneys site in Annan, Scotland, owned by Young’s Seafood, cost the fish processor more than £11m, as it reported an operating loss in its financial results for the year ended 30 September 2018.

In its results, the seafood firm detailed exceptional administrative expenses of £18.1m during the financial year, £11.1m of which were attributed to business reorganisation costs related to the closure of the Pinneys factory.

Of the total cost, £7.7m was spent on contractual settlements arising from the closure – predominantly related to redundancy payments for the 450 employees who lost their jobs – while £2.7m of costs were associated with stock write-downs and the one-off disruption to normal production levels.

The rest of Young’s          exceptional expenses were chalked up to a fixed asset impairment of £7.07m. The producer declined to explain what this related to.

Healthy accounts for Young’s

The rest of the processor’s accounts were much healthier than those reported in the previous year. Turnover for the company was up 4.3% year-on-year to £545.9m, while earnings before interest, taxes, depreciation and amortisation (EBITDA) grew 16% to £23m.

Young’s said the results reflected growth in the frozen, chilled, brand and own-label fish and seafood markets, as well as securing a number of own-label contracts

Di Walker, chief executive of Karro Food Group – which purchased Young’s last month​ – said the results demonstrated the company’s potential for future growth.

Foundation for growth

“With a good foundation for growth and new ownership in place, Young’s Seafood is progressing well with the first phase of transition, achieving export growth and new contract wins since the time of these accounts,”​ Walker added.

“As we drive forward with our plans for the group, we are very excited about creating an ambitious multi-protein food business, further developing and broadening our relationships with our key partners.”

Despite a rise in sales and EBITDA for the year, the costs surrounding the Pinneys closure, an increase in the cost of sales, as well as distributive costs meant Young’s reported a £10.2m loss – £7.99m after tax.

However, this loss was still down from that reported in the previous year – £39.3m for the year ending 30 September 2017, largely caused by an impairment goodwill charge of £39.5m.

Related topics: Operations, Meat, poultry & seafood

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