Simpsons Malt Limited has reported an increase in profits from 2021 to 2022 after publishing its latest set of financial accounts. The fifth-generation, family-owned business and Certified B Corporation, which includes agricultural merchanting division McCreath Simpson & Prentice, recorded a profit before tax of £9.5 million (2021: £7.1 million) from a turnover of £273.8 million (2021: £214.2 million).
During the financial year (January 1 – December 31), the company built on the benefits of having acquired the grain merchanting business of W.N. Lindsay Ltd in 2021 and the additional storage infrastructure it provided, collecting record volumes of malting barley direct from its increased number of growers. The merchanting division, overall, experienced an excellent year with strong demand for all crop inputs and feedstuffs.
On the malting side, distilling malt volumes made up a substantial part of the overall traded volume and demand from this sector remained resilient, with year-on-year growth expected to continue into 2023.
The demand for brewing malt, meanwhile, was steady, albeit slowing slightly as breweries faced increased operating costs. That, combined with higher malting barley values – a result of the conflict in Ukraine – and increased interest costs, meant that profit margins declined in the final quarter of the year.
In 2022, there was an investment of more than £4.3million on tangible fixed assets, including a new grain dryer at its Craigswalls Grain Store, improvement in power and kilning capacity at its Tweed Valley Maltings headquarters in Berwick-upon-Tweed, increased storage capacity at its Tivetshall Maltings in Norfolk and a minority investment in Yaregrain PLC to improve its service and barley storage offering to malting barley growers in Norfolk.
The company also assisted its workers during the cost-of-living crisis, with a £1,000 payment made to all full-time colleagues in August 2022, while more than £78,000 was donated to various good causes local to the company’s eight sites during the year.
Speaking about the financial results for 2022, Simpsons Malt Ltd Managing Director, Tim McCreath, said: “In a year of global uncertainty, we’re delighted to be able to report a strong set of financial results, which can be attributed to prudent decision making, careful cost management and a focus on value added trading activities."
“With the conflict in Ukraine ongoing and through witnessing the impact this has had on both grain and energy values, as a business we remain mindful of how geopolitical events – and other risks and uncertainties – can impact us on a day-to-day basis."
“However, with demand from the distilling sector continuing to grow and the benefits of our vertically integrated supply chain from crop input supply through to malt delivery, prospects for both the malting and agricultural merchanting divisions of the business remain positive.”