Somerdale International Limited (Somerdale) has published its report and accounts for the year ended 31st March 2021. The results demonstrate that the company continued to perform strongly at a financial, commercial and operational level despite the unprecedented challenges of Covid-19, the UK’s departure from the EU and the impact, for nearly all of the year, of retaliatory tariffs imposed on British cheese entering the US market. At the same time, Somerdale also continued to invest in: reinforcing its operational capabilities; growing its presence in core and emerging markets and; developing further its broad, differentiated product portfolio of high-quality British cheeses.
Trading conditions were good for the majority of the year with the pandemic only having a limited negative impact. Indeed, in most markets, the business benefitted from a surge in demand as lockdown restrictions gave rise to a renaissance in home cooking and entertaining at home, which in turn resulted in consumers purchasing more of Somerdale’s products through its well-established retail distribution channels.
In the current financial year, the business is continuing to perform well despite a significant increase in freight and packaging costs, restricted shipping container availability and labour shortages. The ability to cope with these headwinds reflects the underlying strength and agility of the business which, working closely with its key customers, suppliers and distribution partners, has allowed it to adapt to rapidly changing market conditions.
Financial and commercial highlights in brief:
- Turnover increased by £3.8 million (+9%) to £45.8 million (2020: £42.0 million).
- Somerdale’s US sales reached a record $25.9 million (£20 million), up some 3% year on year reinforcing its position as the leading supplier of British cheese to the North American market.
- Profit before tax increased to £1.78 million (2020: £605,000).
- The financial strength of the business continued to improve with net assets increasing further to £2.8 million and current assets growing to just over £2 million.
- In the last quarter of the financial year, Somerdale acquired the blended cheese business of Abergavenny Fine Foods (AFF). This included the transfer to Somerdale of AFF’s blended cheese processing assets, brands and associated trademarks. In doing so, this has reinforced Somerdale’s position as a leading supplier of blended cheese to over 30 countries across the globe and is enabling it to grow and develop our portfolio of blended cheeses developed specifically for the international marketplace.
Said Trevor Debenham, Finance Director, when commenting on the results: “During the 2020/21 financial year the business continued to perform strongly. Turnover and profitability both grew, helped in no small part by record sales in the US – our largest and most important market. In response to Covid-19, Somerdale continued to prioritise the health and safety of our staff while at the same time building as much resilience as possible into our supply chains. Indeed, thanks to the commitment of our staff, allied with the close collaboration and support of our customers and supply partners, we were able to handle the surge in retail demand while still maintaining our customer service, product quality, and availability levels throughout.
“Looking forward, the directors expect a strong trading performance in the current year and beyond. Central to this will be Somerdale’s flexibility and agility in reacting to new opportunities & risks and our ongoing commitment to investing in and enhancing our operational capabilities, in-market presence, product range and marketing activity. While, the removal from March 2021 of retaliatory tariffs on British cheese entering the US market is a further positive development as this improves the competitiveness of UK products and should support further sales growth.” For more visit somerdale.com/