Pressure on potato prices weighed on Produce Investments profits in last financial year

Pressure on potato prices weighed on Produce Investments' profits in last financial year

UK supplier Produce Investments today (10 November) confirmed its packing facility in Kent will close.

The group warned last month the site could shut. In a statement to the London Stock Exchange this morning, the business said a consultation period with staff had ended and the facility would close early next month.

Volumes will move to Produce Investments' sites in the Scottish Borders and Cambridgeshire.

In the year to 27 June, Produce Investments saw its annual operating profits fall by nearly 28%. It claimed "highly challenging market conditions" driven by price wars in the major supermarkets had hit sales.

A bumper potato crop of 5.74m tonnes - up from 5.58m in 2013 and 4.49m in 2012 - resulted in pressure on potato prices which,the company said was largely responsible for the group's turnover falling to GBP178.4m, from GBP191.8m 12 months earlier.

The drop in sales, combined with costs linked to a series of measures to improve efficiency, led to operating profits for the year falling to GBP8.1m against GBP11.1m in 2014. Net profit was GBP5.6m, versus GBP7.8m.