John West’s recent financial results reveal a pre-tax loss of £6.7m in 2023 marking its first deficit since 2010.
- The Liverpool-based company failed in its attempt to pass on price increases to consumers, impacting profitability.
- Turnover increased to £134.5m, up from £128.2m in 2022, yet gross profit margins significantly declined.
- The strategic decision not to forward inflation-linked price hikes was to maintain customer base and market share.
- John West is owned by Thai Union Group since 2010, specializing in various canned fish products.
John West, a renowned producer of canned tuna and other seafood, has disclosed a pre-tax loss of £6.7 million for the year 2023. This marks a significant setback for the company, as it is their first loss since 2010. The figures were revealed in financial accounts filed with Companies House, depicting a stark contrast to the £2 million profit reported in 2022.
Although the company’s turnover reflected an increase, rising to £134.5 million from £128.2 million in the previous year, this growth did not translate into higher gross profits. The gross profit margins witnessed a substantial decline to 9.1% from 17.6%, an outcome of John West’s strategic move to refrain from passing on all inflation-related price hikes to their customers. By choosing this approach, the company aimed to protect its customer base and market share amidst rising global commodity costs.
The decision to absorb inflationary pressures instead of transferring them to the consumer demonstrates John West’s commitment to customer retention. Such a strategy was perceived as pivotal in ensuring the brand’s competitive edge in a market prone to fluctuating raw material prices. The last time John West experienced a financial loss was in 2010 with a reported deficit of £1.1 million.
Owned by Thai Union Group since its acquisition in 2010, John West has continued to specialize in a wide array of canned seafood products including salmon, mackerel, and sardines, among others. This ownership transition positioned the brand for expansion within the global seafood market, yet the recent financial disclosure highlights the ongoing challenges in navigating economic fluctuations.
John West’s financial trajectory underscores the complexities of balancing profitability with strategic market positioning.
