Co Tyrone meat firm targets Asia as profits increase five-fold
A co Tyrone meat processor that specialises in so-called 'fifth quarter' animal products has announced a jump in turnover from £23.6m to £32.4m.
Elmgrove Foods, which is part of Dunbia in Dungannon, processes and supplies offal products in beef, lamb and pork, including beef Achilles and gallbladder, and lamb tripe.
Pre-tax profits were £515,401 - close to a five-fold increase on the previous year's pre-tax profits of £107,572.
A strategic report accompanying the accounts for the 12 months to the end of March 2015 said the 38% jump in turnover was due to increasing volumes, including an expansion of product ranges.
However, there was no analysis of turnover because it would harm the company's interests to disclose it, the report said.
But the financial position was summarised as "pleasing," though the company admitted it was aiming for further growth.
"Over the next financial year, the company aims to continue to grow through increased volumes and further expansion of the product ranges and diversification into further markets," it added.
But the report said there were regulatory risks in the food industry, due to EU and UK government legislation and directives on food policy. "Such policies can have both positive and negative impacts on the industry," the report explained.
"However, compliance with the regulatory environment in which the company operates helps to reduce the potential impact of such risks."
The report described "reputational risk" as a "constant challenge", and Elmgrove also described the offal market as "competitive".
"However, it has achieved and maintains the ability to purchase volumes necessary to meet both customer demand and achieve its growth strategy," the report read. "Product prices are volatile and hard to predict and as this is the company's most significant cost, the director monitors both expected and achieved margins on a daily basis."
Offal products are not popular in the UK and Europe but are regarded as delicacies in China and Japan.
Managing director Stuart Dobson said the company was recruiting two new staff to help it make sales in China after Dunbia joined Karro Group in winning approval to export pork products to Asia. The firm hopes to ship its first product to the region in March or April. And it is hoping to sell goods into Japan, where offal products are also popular.
Parent company Dunbia reached turnover of nearly £769m for the year ending March 2015, which was up more than £40m on the previous year.
But pre-tax profits for the company fell during the course of the last financial year - dropping by almost £3m to £4.6m.
Last month, the Belfast Telegraph revealed that Dunbia was looking for buyers, after a teaser document was to be sent out to businesses with a potential interest in the company.
Pre-tax profits for the 12 months to March 2015, well up on £107,572