(Alliance News) - Norish PLC on Friday said its revenue dropped in the first half of 2019 after a less-than-stellar performance from its Sourcing division.
The cold-storage warehousing and logistics firm's revenue fell 5.4% in the six months ended June 30 to GBP17.5 million from GBP18.5 million a year ago, resulting from a 14% drop in Sourcing division revenue to GBP9.8 million from GBP11.4 million.
The Sourcing division's operating profit fell by a third to GBP200,000 from GBP300,000, which Norish put down to "trading uncertainty and currency fluctuations arising from the ongoing Brexit process".
The company said it has added fish to its protein supply and is putting other initiatives in place "to return to a growth trajectory".
Revenue for Norish's Cold Store division rose 9.0% to GBP7.3 million from GBP6.7 million, however, which somewhat offset the decline in Sourcing revenue. Dairy division revenue also doubled to GBP400,000 from GBP200,00.
Norish's group pretax profit for the period was GBP1.3 million, up 48% from GBP878,000 the year before. This was due to cost of sales, which shrunk 8.1% to GBP15.8 million from GBP17.2 million and meant that gross profit rose 21% to GBP1.7 million from GBP1.4 million.
Commenting on its outlook, Norish said: "Our cold store business continues to focus on improved revenue generation (in particular sales mix) by working collaboratively with customers, in the context of the resources available to the business. We continue to pursue initiatives to offset underlying cost growth pressures. In a general sense, the Temperature Controlled market appears to be operating close to capacity, as we head into the important final months of the year.
"We expect to make further progress in our cold store business over the remainder of the year and beyond."
Norish added that, for its Dairy division: "it has been a very good year for grass production and this together with renewed focus on cost control should see the farm generate a much-improved result.
"Next year should see an opportunity to further increase stock numbers and transition to an A2 protein dairy herd. We expect Grass to Milk Co to achieve commercial sales in the second half of 2020; a major milestone in the development of this niche, value-add dairy business."
Shares in Norish were flat at 63.00 pence in London on Friday.
