Household products manufacturer McBride has said that it is already seeing benefits from its new 'Compass' strategy, which has seen the business aligned into five divisions, Liquids, Unit Dosing, Powders, Asia Pacific and Aerosols, supported by a leaner group structure.
The private label and contract manufacturer held a Capital Markets Day to announce details of its strategy, as well as its 'robust response' to COVID-19, which saw no business disruption across its operations.
As of 1 January, McBride restructured its European Household business into the three business divisions of Liquids, Unit Dosing and Powders, to operate alongside the Asia Pacific and Aerosols divisions, with he group also engaging in 'a number of activities' to bolster synergy benefits.
'This structure will give the focus and accountability to deliver the Group's vision of profitably growing annual revenues to €1 billion in the next five years,' it said.
'Through the comprehensive strategic review, all divisions and central functions have developed individual strategies, aligned to their differing dynamics, in order to achieve this collective goal.'
Interim Performance
In the six-month period to 31 December, McBride said that its household contract manufacturing business delivered strong growth, with a good profit performance driven by increased demand for cleaning, dishwash and aerosol products.
This outweighed weakness in laundry products, while there was also a 'slight softening' of certain raw material and packaging pricing, the company said.
Group revenues came in at £362.9 million (€420.1 million), which was 3.6% higher (+1.7% at constant currency), while adjusted operating profit stood at £19.0 million, up from £11.6 million the previous year.
"I am proud of the way our company has responded to the challenges faced by the business from both COVID-19 and Brexit in the period and with these robust financial results for the six months," commented Chris Smith, chief executive.
"Our teams have shown significant commitment to complete the Compass strategy preparation and business reorganisation programme on schedule. The group has been operating under its new divisional structure since the beginning of 2021, and I can already start to see beneficial effects of the new management teams leading their businesses. "
Smith added that while the company has seen input costs "start to tick up", the board's expectations for the full year are in line with its December trading update.
Brexit Impact
On Brexit, meanwhile, the company said that while products manufactured in the UK are for UK customers, the import of products from the EU has 'operated effectively' to date. It did experience some 'limited disruption' in December, however, due to the closure of the French border over COVID-19 concerns.
'We are currently experiencing additional costs and increased freight rates from a combination of COVID-19 restrictions and changes to administrative procedures related to Brexit,' it said.
© 2021 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
