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Health snacks firm's premium brands push as supermarkets get tough on own brand prices

By Margaret Canning

Published 25/09/2015

Kestrel Foods directors Michael and Lorraine Hall
Kestrel Foods directors Michael and Lorraine Hall
Esmee Hall with some of the company’s Acti-Snack range

Multi-million pound health snacks company Kestrel Foods in Co Armagh has said "aggressive" pricing by supermarkets is increasing the need to invest in its own premium brands.

The Portadown firm, which is run by husband and wife Michael and Lorraine Hall, reported a 5.7% increase in turnover from £11.5m to £12.1m in the year to the end of April 2015, according to results filed at Companies House.

But pre-tax profits were down by nearly 28% to £653,418 from £903,770 on the previous 12 months - although staff numbers had grown 10%, from 60 to 66.

The business processes and sells dried fruit, nuts and seeds, and the Forest Feast and Acti-Snack range of snacks. Forest Feast is the longer-established brand with Acti-Snack, aimed at the sports nutrition market, launched two years ago.

In a strategic report filed with the accounts, Kestrel Foods said the year's performance had been "encouraging" with its sales increase down to a heavy marketing and advertising of its Forest Feast and Acti-Snack brands.

"The dried fruit and nut sector remains highly competitive," it added. "The aggressive pricing of supermarket own brand products continues to provide a benchmark for value products which has highlighted the need for brand development to enable the premium products to command a premium price."

The business was founded in 1996 by the Halls and is now based at Carn Drive in Portadown.

It exports to around 30 countries around the world and is stocked in multiple supermarkets and symbol groups such as Spar.

And the couple's entrepreneurial prowess was recognised last year when the pair were finalists in the Ireland-wide Ernst & Young Entrepreneur of the Year competition.

In its latest supermarket deal, the company will be stocking 257 Asda stores across Northern Ireland and in Britain.

It has also made inroads into the food service, travel retail/airline, e-commerce and hospitality markets, as well as supplying private label goods.

Financial controller Lorraine McAfee told the Belfast Telegraph: "Kestrel Foods has undertaken a period of significant capital investment in new process machinery focused on the future growth of the company.

"Trading conditions over the past 12 months have been difficult given the high price of commodities.

"However, the business has been able to identify new opportunities and as such the directors are confident of significant growth in the company going forward and the investment which has been undertaken is commensurate to this."

To avoid the risks posed by overseas weather events, the company has a policy of forward-buying and having two suppliers per commodity where possible.

The report said performance was affected by consumer behaviour and general economic conditions. And sectoral factors such as seasonal buying of dried fruit and nuts could also affect sales performance.

The firm said it had invested over £750,000 in processing and packaging technology in the past year to boost export sales, as well as production and product development.

Its ultimate aim, the firm said, was to "manufacture and supply premium quality branded dried fruit, nuts and seeds on a global basis".

Belfast Telegraph

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