2 Sisters Food Group fell further into the red after the acquisition of Vion’s poultry and red meat businesses last year.
According to accounts filed with Companies House, the Birmingham-based poultry giant reported a 772% increase in pre-tax losses for the year ended July 27, 2013.
Pre-tax losses at the firm increased to £15.955million, from a loss of £1.834million the year before. This was against a 9.9% increase in turnover to £855million, from £778million previously.
Despite a further plunge into the red, accounts reveal one of the company’s three directors was paid more than £500,000 last year.
2 Sisters bought 11 UK red meat and poultry processing sites from the Vion Food Group in March 2013 – these included the McIntosh Donald lamb and beef processing business at Portlethen, a hatchery at Inverurie and Scotland’s largest fresh chicken processor, at Coupar Angus.
At the time, the firm said the deal – estimated to be worth around £30million – would provide it with additional capacity to meet its customers’ demands for quality and value-for-money products.
Vion put its UK businesses up for sale in November 2012 after incurring multimillion-pound losses. It shut its Broxburn pig processing site with the loss of 1,700 jobs and sold the remainder of its pork business to a management team backed by private equity firm Endless.
2 Sisters said: “As we enter the new financial year, the increase in feed ingredient prices remains a challenge to the business, as it is for many other food manufacturers. The company is working with customers to recover feed inflation and drive volume and invest in capacity and efficiency.”
The firm said profits were down due to “difficult trading conditions experienced in the period from increased feed prices”.
“The UK poultry market is expected to see continued pressure due to the impact of inflation and changes in promotional dynamics by some retailers,” said 2 Sisters.
The firm, which is Scotland’s only poultry processor, recently cut production at its Coupar Angus plant by 30% to 525,000 birds a week, sparking concern among north-east producers. It also sold off its Letham plant near Forfar, in Angus.