Iceland Seafood International’s UK subsidiaries continued their strong sales growth in the year ending Dec. 31 2014, with young company Havelok reducing its start-up losses and the group overall increasing its profits. 2014 is the first full year in which ISI subsidiary Iceland Seafood Barraclough (ISB) reported its results as the parent of the UK subsidiaries. As it notes: “ISB is a combination of a holding company for the UK group’s investments in Iceland Seafood Barraclough (a retail focused processing business) and Havelok Limited (a foodservice trading business), and a trading entity in its own right.” ISB was the group’s original business in the UK, and was formerly called Iceland Seafood Limited. This business acquired F. Barraclough a few years ago, and the two businesses are now effectively run as one business, led by Allen Townsend. At the start of 2014 both of these businesses were merged into Bradford-based ISB.
ISB in 2014 saw sales of £35.9 million, representing a £9.9m, or 38%, increase on 2013. This was driven by growth in both trading subsidiaries,it said. Taking whitefish-focused supplier ISB’s trading in isolation, further new listings of both fish and shellfish in a number of existing and new customers saw sales increase by £5.4m, to £28.4m.
Higher activity levels for both ISB and Havelok, and a variety of capital investments, have enabled the group to improve operational efficiencies, aiding margin improvement, ISB noted.As a result, the group made an operating profit of £891,836, and a net profit of £391,000, compared to a loss of £357,500 the previous year. “I’m delighted with the progress our UK businesses made during 2014,”Lee Camfield, chairman of ISI’s UK operations, told Undercurrent News. “Despite the challenging retail environment our retail business, Iceland Seafood Barraclough, continued to expand its product range and customer base delivering a 23% increase in turnover. “”Havelok, our foodservice facing business, in only its second full year of trading doubled sales to £7.7m. Both business are focused on operational efficiencies and made further strides in improving our processes, these along with the sales increases enabled the UK group to turn the small loss in 2013 (driven by the Havelok investment) into profits in 2014,” said Camfield. “After four years of consecutive growth we expect 2015 to be a year of consolidation for Iceland seafood Barraclough. Havelok is seeing strong growth, with sales over 50% up on 2014, and more than 20 new customers acquired during the year.” In a previous interview with Undercurrent, ISB managing director Allen Townsend had credited the firm’s expansion to its focus on improved manufacturing and sourcing arrangements.“We are a private label supplier which has focused efforts and investments on improving manufacturing processes and sourcing arrangements, to reduce supply chain costs and maintain good service levels during the volatility of 2013 and 2014 on various species,” Townsend had told Undercurrent in 2014. “This approach has seen us expand our product range across a number of different customers.” The firm’s strategy for 2014 included focusing on customer needs, managing supply chain costs and longevity of supply, and driving operational costs down, Townsend had added.
Last year was Grimsby-based Havelok’s second year of trading, and after a rapid start in 2013 – gaining 66 customers – that growth continued in year two. “Sales development during 2014 has been very encouraging, with a number of new customers secured across a variety of sectors within the foodservice arena, and aided sales of £7.7m; over double those of the previous year,” ISB noted in its annual report. As with the whole group, investments and larger orders have made for more efficient operations. However, while the directors – including managing director Danny Burton and Camfield – were pleased with progress, the business is not yet profitable. “Whilst both the sales and operational performance have been very encouraging, the absolute activity levels remained slightly short of the levels required to fully recover all fixed costs, and as a consequence the business lost £361,000 in the year; a significant improvement on the losses of the previous year,” the report notes. In 2013 Havelok lost £783,647, largely down to the one-off costs of starting it up. Havelok is focused on supply to the foodservice sector, covering all areas where fish and seafood are eaten out of home, and the large majority of sales are to customers who serve this market including wholesalers, restaurant and pub groups, fish & chip shop suppliers and health and education authorities, Havelok manager Danny Burton told Undercurrent in 2014.