More
27 September 2021
– Strategic restructuring and refocusing of the business culminates in £10 million profit after several consecutive years of losses, representing a £48million improvement over the past two years.
– Annual report and accounts cover first full year since business was acquired by Pilgrim’s Pride Corporation and figures have been achieved against the backdrop of Covid
– Business continues to lead the way in regards to animal welfare and sustainability, announcing industry leading commitment to become net zero by 2030
– Sector faces significant headwinds in 2021 but business is well placed for future growth
Pilgrim’s UK has announced revenue growth in 2020, helping the business move into profit after several consecutive years of losses, according to the firm’s annual report and accounts.
Morten Knudsen, CFO at Pilgrim’s UK, commented: “With total revenue over £1.3billion, the business recorded operating profits before exceptional items of £10.3 million in 2020, up from losses in the past 4 years with £17m in 2019, £38m in 2018, £36m in 2017 and £22m in 2016.
“These figures cover the first trading period since the company was acquired by NASDAQ-listed Pilgrim’s Pride Corporation in October 2019 from Danish Crown, during which time the business went from having losses and negative cashflows to generating positive cash flows and reducing debt by over £200m.
The support of Pilgrim’s Pride Corporation has enabled the company to accelerate a turnaround plan under a new strategy, vision, values and methods. The management team has introduced strategic reforms, which have included rebalancing the number and type of pigs owned and processed by the business, and restructuring operations, including a double-digit percentage reduction in headcount and the closure of unprofitable sites. The management team has also brought in measures to reconnect different areas of the business and ensure increased synergies and efficiencies.
The improvement in performance was driven by a robust demand at retail, partially offset by reduction in food service, continued strength in pork exports, especially to China, as well as the implementation of operational improvements.
These achievements have taken place against the backdrop of Covid, with the business implementing a risk management plan focused on protecting team members and the wider community through stringent safety and control measures.
Crucially, throughout the period Pilgrim’s UK has continued to accelerate its work to become the most sustainable business in the sector. The company published its “Pilgrim’s UK 2030” sustainability plan in Autumn 2020 outlining its commitment to reduce emissions across its business and supply chain. The business has subsequently published its roadmap for becoming net zero by 2030 – going further and faster than any of its competitors in tackling climate change and reaching the milestone ten years ahead of the NFU’s industry wide goal.
The company has continued to strengthen and grow business with key customers across the retail sector, driven by innovations in value-added and higher-margin areas with 66 new product lines launched across its customer base in the last quarter of 2020.
The strategic reforms have left the business well placed for ongoing growth but the sector continues to face a number of major challenges in 2021.
Andrew Cracknell, Chief Executive of Pilgrim’s UK, said: “The steps we’ve taken to restructure and refocus the business have given us a strong foundation to navigate the significant headwinds currently facing the sector, and deliver ongoing and sustainable growth.”