Vegetable supplier Produce World has reported a £6.8m loss for the 2016 financial year caused by the costs of exiting a brassica JV and an aphid infestation that devastated brassica crops.
In a statement outlining a turnaround plan that includes restructured business units, investment in automation and planning permission for housing development, the company said it expects profits to exceed £7m for 2017 thanks to “decisive action” and substantially reducing costs.
Chairman William Burgess said: “The losses related to issues around the brassica business, and the costs of leaving the joint venture. Like many companies in fresh produce, we were also hit by exceptional aphid infestations in 2015, which affected both our roots and brassica businesses.
“During that period there has been considerable investment in automation across the group, but particularly at the Isleham site, which is now one of the most up-to-date facilities in the UK for processing and packing roots.
“We also believe that the restructuring of the company into discrete business units has already made us more responsive to changes in the marketplace, and to the needs of our customers.”
During 2017, Produce World said it will continue to reduce its debt through the ongoing disposal of surplus properties at Butterwick, and a 20-acre site at Swinderby with planning permission for housing, plus other development opportunities.
The company continues to operate across four sites as well as its farming operations, supplying organic and conventional roots, onions and potatoes to retail, foodservice and manufacturing. Management now operates at site level, reflecting the needs of each site and category.
Burgess added: “The Burgess family is once again taking a leading role in running Produce World, and we are concentrating our efforts on the key categories of the business where we have a huge amount of experience.
“We are now a fit and lean business, focused on our core areas and ready to confront the challenges of this brutally competitive marketplace.”