VEGETABLE grower Kettle Produce has fallen to a loss, even though its sales have surged by almost 4%.

The Fife company said crop availability had been impaired during the summer of 2011, due to cooler than average temperatures and higher-than-expected rainfall.

However, it met trading targets and fulfilled obligations with all customers, resulting in turnover in the 12 months to May 2012 increasing from £92.7 million to £96.1m.

Loading article content

Sales volumes were said to be running around 12% ahead of the previous year.

The trading period also included the rebuilding of its production facility at Orkie, near Freuchie, being commissioned. The site had been badly damaged in a fire during April 2010 but now has state-of-the-art washing, grading and packing lines in more than 18,000 square metres of purpose-built facilities.

The capital expenditure on the replacement of plant, equipment and buildings plus a large increase in depreciation charges were blamed for the company falling into the red.

The company recorded a pre-tax loss of £814,555 in 2012, compared with an £80,000 profit the previous year.

On a bottom-line operating level, the loss was £563,000 compared with an £81,000 operating profit in 2011.

Finance director Liz Waugh said: "There is no doubt the unprecedented weather conditions of the past couple of years have had an impact on the agricultural and produce industries across the whole of the UK.

"We are not immune to these factors and the lack of availability of crops has resulted in an increase in the cost of our operations.

"Despite this, we were pleased trading remained consistent and our cash position continues to be a strong one. While there is little we can do about the weather, we work closely with our growers to mitigate the circumstances as best we can."

Kettle produces swedes, leeks, broccoli, cauliflower, cabbage, parsnips, lettuce and other vegetables from Orkie and Balmalcolm, near Cupar, as well as in conjunction with more than 50 farmers from across Scotland.

The majority of its stock goes to supermarkets.

The business, which employs around 800 staff, was founded by two farming families who had been growing vegetables in partnership since 1976.

Ms Waugh used the annual results announcement to pay tribute to chairman and founder Clouston McIntyre, who died in May last year.