THE head of Scottish food manufacturer Baxters has hailed its recent acquisition of US company Wornick, which supplies military rations, as a "milestone" for the family-owned business.
Audrey Baxter, executive chairman of Baxters, highlighted the importance of the deal as the Scottish company's latest accounts showed it had made a pre-tax profit of £7.7 million before exceptional charges in the 52 weeks to May 31. This was down marginally from a pre-tax profit of £7.84m, before one-off costs, in the prior financial year.
The Wornick acquisition sees soup-maker Baxters operating a company based in the US for the first time, a company spokeswoman said.
However, she noted the Scottish firm had been serving the US market through its Baxter Canada business.
The acquisition of Wornick, which is based in Cincinnati, Ohio and operates from three sites in the US, adds in excess of 500 people to Baxters' previous workforce of more than 1000.
Ms Baxter highlighted an opportunity to expand in the convenience grocery foods market in North America on the back of the deal.
Wornick Foods says on its website that it supplies convenience foods and military rations to institutional customers including restaurant chains, consumer goods companies, and the US government.
Ms Baxter said of the Wornick purchase: "This acquisition is a milestone for Baxters, and will significantly enhance our presence within one of the largest markets in the world."
She declared that Wornick manufactured high-quality, ready-to-serve foods for blue-chip customers and the US military.
Ms Baxter added: "This addition to the Baxters family deepens our position in the North American market, already served by Baxters Canada, and allows us to drive growth in the convenience grocery foods arena."
After exceptional costs of £7.55m in the year to May 31, 2014, WA Baxter & Sons (Holdings) made pre-tax profits of £146,000.
Ms Baxter said the exceptional charges, in the main, captured integration costs relating to its Fray Bentos and Jensen's Choice Foods operations, new canning technology and the previously reported closure of the majority of the company's retail operations.
She noted that Baxters had, during the year to last May, completed the move of the Fray Bentos factory from Norwich to its headquarters at Fochabers in Moray. The Fray Bentos range includes canned meat pies, and meatballs.
Baxters, which also makes savoury sauces and pickles, is one of Scotland's best-known family companies.
Its turnover totalled nearly £161m in the year to May 2014, up more than two per cent from £157m in the prior financial year. The UK accounted for nearly £102m of the turnover, with international sales totalling £58.9m.
The WA Baxter accounts show that the highest-paid director received emoluments of £899,000 in the 52 weeks to May 31, 2014. This was up from £735,000 in the prior financial year.
Baxters noted that its Canadian business and Wornick were being united in a new division, led by Ron Davis. Mr Davis previously led Wornick, between 1999 and 2004. He joined Baxters as a non-executive director in 2013.
Ms Baxter said she would like to place on record her thanks to Bill King, who stepped down as chief executive of Baxters earlier this year. He had been with the company for more than a decade.
She added: "Bill contributed much to our business. With so many exciting new developments currently ongoing within Baxters, it is my intention to assume the role of chief executive for the foreseeable future."
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