Rising costs hit profits at PD Hook, but directors optimistic for future

Operating profits have fallen at PD Hook Group, according to its latest annual report filed with Companies House.

Annual sales at the company, which hatches and supplies day old chicks and poults, and also rears parent stock, broiler chickens and turkey poults, increased by £24 million in the year ending 31 October 2018, from £541 million on 2017 to £565 million. Operating profits decreased to £20 million in 2018, from £21.9 million the year before, primarily as a result of rising costs, according to the report.

The company said the increase in sales “represented a combination of the impact of sales volume and price growth together with positive sales of turkey poults in our first full year of trading since the acquisition of Bernard Matthews in 2017.”

The company operates more than 100 farms and eight hatcheries across the UK. The directors’ report said business has remained healthy throughout the year and trade has generally been good with a positive demand for British poultry. 

“This reflects the attractiveness of chicken and turkey as a healthy versatile, low cost protein,” the report stated.

“However, we have faced a challenging marketplace and tough economic conditions with unprecedented levels of uncertainty arising from the political climate and the Brexit process. The recruitment and retention of staff has proved ever more difficult as the pool of available labour reduced and a number of migrant workers chose to return to their native homes.”

During the course of the year, the company spent more than £10 million on capital programmes. This has included a number of new farms to ensure the company has sufficient hatching eggs to meet the growing demand for day old chicks. A decision was taken to dispose of the hatchery at Bryn Du, the report says. 

The directors said the outlook was positive, and there was strong demand for British chicks and chicken.

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