Monday 24th March 2008

A trading profit of £1.7 million has been announced for 2007 by Scotland’s leading farmer-owned co-operative, the ANM Group Ltd.

In a year of challenges for the industry Group throughput has increased by £1.957 million to £192.341 million, while turnover has risen by £3.27 million to £91.33 million.

Meanwhile stakeholders once again underlined their confidence in the Aberdeenshire-based company with share capital rising to £5.12 million.

Results show that the Group’s parent society – which includes Aberdeen & Northern Marts and Thainstone Specialist Auctions (TSA) turned in a profit of £830,000.

Although this trading profit is down on 2006, ANM Group Ltd chief executive Brian Pack described the figure as very “satisfactory” given the foot and mouth problems of last year.

A useful earner again in 2007 for the marts division was trade in single farm payments. The value and amount traded over the past 12-months provided a substantial additional income stream.

Aberdeen & Northern (Estates) enjoyed an £8,000 increase in turnover for 2007, despite fewer farms being traded. The business has also increased its team, appointing an additional member of staff to cope with increased workloads.

Meanwhile profits were up at catering division Highland Cuisine which realised £62,000 thanks to a bumper summer show circuit. The company doubled its presence at shows in 2007 due to acquiring the assets of Glenmore Catering.

There were also much improved results from the Group’s food businesses and, in particular its slaughter business, after a very difficult 2006.

The most dramatic shift was the result achieved by Scotch Premier Meat which recorded a profit of £379,000 for 2007 – a major turnaround of more than three quarters of a million pounds after the £391,000 loss reported in 2006.

Yorkshire Premier Meat also experienced a turnaround in 2007 thanks to improved market conditions and a drop in production costs. The company saw profit rise by £363,000 to £450,000 in 2007.

Meanwhile Highland Country Foods and Charcuterie Continental turned in losses, of £11,000 and £78,000 respectively. Also experiencing a tough year H&I livestock recorded a loss of £22,000 – caused mainly by poor lamb prices in spring 2007.

Mr Pack said that while the majority of the 2007 results were very positive, he was also mindful of the challenges which undoubtedly lie ahead.

“We are not complacent and I am sure the Group will experience future ups and downs. Like the agricultural production industry, we expect returns to become more volatile. Just as farming has had to adjust, it is inevitable that processors will experience change and, as a Group we are up for these challenges,” he explained.

“A great comfort in facing these challenges is our financial strength which ensures we are fit to take full advantage of opportunities as they appear.”

The ANM Group Ltd – which marks its 125th anniversary of trading this year – dates back to 1882 with the formation of the Aberdeen Cattle and Farm Produce Association Ltd which started trading in 1883.

This particular organisation differed from any other auction company operating in the area at the time because it was owned and controlled by farmers – this is still true today, making the ANM Group one of the largest farmer-owned businesses in the UK.

In his annual report John McIntosh, ANM Group Ltd chairman praised the Group’s loyalty to the original principles of providing a marketing service for livestock producers.

“The industry has changed, as has the way the Group operates but it is still owned by producers and operates as a mutual,” explained Mr McIntosh.

“Over the years we have steadily grown financial reserves to ensure we can face the challenges of our marketplaces and in 2007 we added to them, underlining the benefits of a diversified business.

“It is likely we would have made a trading profit of around £2 million were it not for the losses experienced with closed auction marts due to foot and mouth disease hundreds of miles away in Surrey. However, the ability to withstand this and record a very acceptable profit demonstrates our strength.”

Given the very satisfactory result for 2007 the board agreed to issue shares under the All Employee Share Option Plan. The total allocation for this is £172,000.

“This underlines the appreciation of the tremendous effort by all staff to achieve profitability and customer satisfaction.” concluded Mr McIntosh.

In summing up Mr Pack said: “Undoubtedly our founders 125-years-ago also experienced massive challenges and, while things have changed, the Group still has the principles of reacting to change, striving for efficiency and achieving our vision statement of being the acknowledged leader in quality, service and professionalism in our chosen markets.”

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