GRAIN merchant Alexander Inglis & Son has seen its revenue grow 13.3 per cent on strong demand from the Scotch whisky sector but tighter margins led to profits falling.
In annual accounts filed at Companies House the East Lothian business, run by former Scotland rugby captain Jim Aitken and his family, sees its turnover rise from £70 million to a record £79.3m in 2013 but pre-tax profits reversed more than 22 per cent from £2.06m to £1.6m.
The company, which supplies barley to a number of whisky producers, saw its cost of sales rise from £64.1m to almost £74m while it's interest and financing charges came in at £1.26m, up from £1.06m.
Writing in the accounts Mr Aitken said: "The group's results reflect the margins and prices generally available in cereals trading.
"Turnover can fluctuate from year to year depending on the quality of the grain harvest and market prices. The group remains in a good position to take advantage of any opportunities which may arise in the future."
The value of stock on the Alexander Inglis balance sheet was down slightly from £25.8m to £24.5m.
There was also more than £15m shaved off the company's net debt in the year and it ended 2013 with a figure just short of £27.1m.
Speaking yesterday Mr Aitken indicated the change in margins relates to the differing prices paid for grain during the year. He said: "We are a trading organisation, not a manufacturing organisation so keeping constant margins is all about keeping on your toes on the day."
The turnover rise was said to be down to continued strong demand from Scotch whisky producers for barley with the business seeing the benefits from a £2.5m deal struck in 2012 to buy additional sites in the Scottish Borders and Northumberland. At that time storage capacity at the business was around 250,000 tonnes but Mr Aitken said it is now around 300,000 tonnes. There are plans for additional capacity at Ormiston and Errol in the pipeline and he said: "We are investing in increasing the size of two of the sites. One we are going to start on at the turn of the year and one we are still waiting on planning permission for."
Mr Aitken said he was confident of his business continuing to prosper as long as Scotch whisky remains in a growth phase.
He said: "The grain business in Scotland is basically a line to the drinks industry which is mainly whisky. We have got to keep pace with them."
The accounts showed staff number steady at 47 although employee costs rose from £2m to almost £2.9m.
Directors' remuneration rose from £579,238 to £595,030 although the highest paid saw a fall from £210,302 to £182,292.
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