Nairn’s flags Brexit risk after rise in profits

OATCAKE maker Nairn’s has recorded strong growth in profits helped by a forecast-beating sales performance but has plans to deal with risks associated with Brexit.

The Edinburgh-based firm, which says it is the largest producer of oatcakes in the UK, made £4.8 million profit before tax in the year to May 25 compared with £3.8m in the preceding period.

Sales rose to £33.4m from £30m last time.

Nairn’s said turnover was better than internal forecasts with performance ahead of market benchmarks in both core and gluten free ranges.

The privately-owned firm has invested in widening its offering in those ranges and in developing new products such as oat bars and pop oat products.

In their strategic report in the company’s accounts for the year, directors said the new products provide a healthy alternative in the high-growth snacking category.

The company had faced cost increases but still managed to achieve higher than forecast profits.

“Like many other businesses, the company has faced challenges in the form of continued uncertainty and potential implications from Brexit, further expected cost increases in key ingredients and a challenging domestic retail landscape,” said the directors.

Highlighting the importance of factors such as changes in global raw material prices and regulatory changes, they noted: “The company has a specific Brexit risk mitigation plan.”

However, they said the company had made good progress against financial and strategic objectives in the latest year. The company’s strategy remains to grow sales through its existing range and “consumer-driven new product development” and brand investment.

The business began as a bakery started by John and Sarah Nairn in Strathaven in 1896. Mark Laing led a deal to buy the company from United Biscuits in 1996. He remains a director of the firm and a significant shareholder in the parent Peffermill Holdings business.