Creightons swings to half-year profit on cost-cutting measures

(Alliance News) - Consumer goods maker Creightons PLC on Monday reported a decline in half-year ...

Alliance News 4 December, 2023 | 11:56AM
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(Alliance News) - Consumer goods maker Creightons PLC on Monday reported a decline in half-year revenue, though it swung to profit amid "remedial measures" to combat inflationary pressure.

Shares in the company rose 5.9% to 23.82 pence each in London on Monday morning.

In the six months to September 30, revenue declined 7.1% to GBP27.6 million from GBP29.7 million a year prior.

Peterborough-based Creightons said sales in its Private Label division were 9.8% higher, though in the Branded and Contract arms, sales fell 3.3% and 37%, respectively.

Creightons swung to a pretax profit of GBP302,000, from a loss of GBP359,000 a year earlier.

"The group has responded proactively to the unprecedented challenges facing the business due to supply chain constraints, higher commodity, and energy prices. The remedial measures were intended to restore profitability, reduce costs and inventory and to return to positive cash flow," the firm said.

Creightons said cost-cutting included reducing its manufacturing team to one shift at its Peterborough and Devon centres.

As a result of these efforts, administrative costs have decreased 5.1% to GBP9.3 million from GBP9.8 million.

Its gross margin improved year-on-year to 42.2% from 40.4%.

Looking ahead, it said: "In common with most UK manufacturing businesses, we are operating in a period of significant inflationary pressures and weakening consumer demand. Our objective is to meet our customer expectations and to deliver top line sales growth whilst also relentlessly focusing on the areas within our control including recovery/mitigation of cost price increases, delivery of the cost reduction programme and reduction in stock levels. The margin recovery and pro-active cost reduction measures we have taken will continue to deliver an improved performance in the second half of the year."

By Hugh Cameron, Alliance News reporter

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Creightons PLC 19.50 GBX 0.00 -

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