Macphie sees results hit by soaring cost of raw materials

SOARING raw material costs depressed profits at Macphie of Glenbervie, the North-east-based food ingredients manufacturer and meat supplier, last year.

The family-owned company, which employs more than 280 people between its headquarters and a second manufacturing site based at Uddingston, saw turnover rise by 2.6 per cent to 41.8 million in the year to 31 March but operating profits slumped by a quarter to 2.02m. Pre-tax profits, after goodwill amortisation, fell to 958,082 from 1.45m.

The company, which supplies major food groups including Greggs, said that in common with others in the food industry it had hit by rapidly increasing raw material costs against a backdrop of a depressed business and consumer marketplace.

Chief executive Alastair Macphie said there had only been "negligible recovery" seen since the recession.

"While these results reflect a challenging marketplace, our underlying business remains resilient and profitable and we are continuing to invest for the future," he stressed.

Last summer the company launched its first consumer brand, dessert range DeviliShh, which Macphie said had already built a strong distribution network among retailers.

The number of people employed by the group rose during the year to 283 from 266 with the highest paid director, thought to be Macphie, receiving a 178,109 pay package, down from 198,471. Dividends of 673,981 were paid during the year, up from 440,519.

The group's pension deficit fell by 421,000 to 2.13m at the year end.

As well as its ingredient operations, the company owns a herd of 500 pedigree Aberdeen Angus cattle and is involved in a joint venture with A K Stoddart, an Edinburgh-based meat processor.

The company was founded by Alister Macphie in Glasgow in 1928 as a wholesale bakery.