A rise inflation and costs contributed to losses nearing £50m at the company behind the Harringtons pet food brand during its latest financial year, it has been revealed.
The business behind North Yorkshire-based Inspired Pet Nutrition has posted pre-tax losses of £47.7m for the 12 months to July 1, 2023, after also losing £37.7m in the prior year.
Newly-filed accounts for the Dalton group, which also makes the Wagg, Barking Heads & Meowing Heads, and AATU brands, show its turnover increased from £148m to £197.6m over the same period.
The average number of people employed by the company during the year increased from 355 to 436.
The official accounts come after Inspired Pet Nutrition issued a release last month stating that it had surpassed the £200m turnover mark but provided no further financial details.
A statement signed off by the board said: “Margins came under pressure due to inflation and our continued commitment to limit price rises passed on to our customers and consumers to ensure we stick to our affordable credentials whilst balancing margin recovery to allow continued reinvestment in the business and brands.”
The business said its operating losses included £36.5m of amortisation charges on acquired intangibles, £6.7m of depreciation and £2.9m of exceptional items.
It added: “Profitability was hampered by increased operational costs including utilities and labour.
“This, coupled with significant raw material and packaging inflation, meant for a challenging trading environment.”
The company also said: “The directors remain of the opinion that in order to remain a low cost, flexible and high quality manufacturer, the group must continue to invest in new technology and automation.
“These Capex and stock investments were financed out of internally generated funds, tight control of working capital and external borrowings from committed facilities.
“To keep up with demands and lower costs at the wet food and dry for facilities, the group will invest further in specific capital projects to drive efficiency, capability and capacity.”
Inspired Pet Nutrition, which also has a base in Kinmel, North Wales, can trace its roots back to 1923 and is led by Richard Page, grandson of the business’ founder, James R Page.
Since 2020, the company has bee majority owned by London-based private equity firm CapVest.
On its future, the business said: “The directors remain confident that they can continue to grow the business organically and via strategic acquisitions in what remains a challenging, unpredictable economic environment.
“The experience of significant channel shifts, demands for changing product formats and value propositions alongside significant inflation and wider macroeconomic and geopolitical uncertainty will continue to require dynamic approaches to the group’s markets.”
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