Cranswick has revealed that a salmonella incident earlier this year cost the company more than £3million ($3.6million).
In a half-year earnings statement ending September 24, 2022, the food maker said the group’s adjusted operating profit was 1.7 percent lower at £68.4 million ($81.4 million).
This included a charge of £3.1m ($3.7m) for costs related to the product recall in May after salmonella was found at the Hull cooked poultry facility in England.
The lower operating margin reflected the short-term lag in the recovery of inflationary pressures in several cost categories. Good progress is being made in addressing and covering these additional costs, Cranswick said.
Recall and production discontinued
In May, Cranswick halted production at the Hull plant after salmonella was found. A routine internal inspection revealed the problem with some cooked chicken products.
The company asked customers to withdraw all ready-to-eat chicken products manufactured during the affected period.
The products were sold as ingredients for sandwiches and meals in UK retailers and food-to-go outlets. A number of supermarkets including Marks and Spencer, Tesco, Waitrose, Aldi and Sainsbury’s issued recalls. As does Amazon, coffee shops Costa, Starbucks, and Caffé Nero, and sandwich shop franchise Pret A Manger.
Cooked poultry sales were lower as a result of the recall as the factory was briefly closed while tests and remedial measures were carried out, but Cranswick said volumes continued to recover throughout the period.
Cranswick said it will continue to closely monitor events related to bird flu, with strict biosecurity protocols being enforced on all farms.
The UK poultry industry is experiencing the most virulent Avian Influenza season with a record number of sanctuaries and surveillance zones for captive birds. At the beginning of November, a nationwide bird keeping ordinance was introduced.
Cranswick CEO Adam Couch said the company has made strides in a challenging operating environment.
“Our unwavering focus on quality, value, innovation and our people, coupled with our commitment to delivering great tasting food created with passion for our customers and the UK consumer, continues to drive our competitive advantage,” he said.
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