Sales at upmarket desserts player Pots & Co suffered a 29% slump last year as covid hit its out-of-home business.
Newly filed accounts show sales fell 28.6% in 2021 from £13.9m to £9.9m, as the pandemic wiped out trading with airlines and its club business in the US.
Joint CEO Fraser Thomson said business in the US “was heavily affected by unprecedented global supply chain challenges affecting both US demand for international products and supply”. As such, its global (excluding UK and Europe) sales fell from £7.6m to under £2m.
However, the UK, which had previously become a minority in its business, saw sales rise from £5.6m to £7.8m. It continues to experience “strong” growth.
Pre-tax losses increased from £2.1m to £4m.
The brand, which received major capital backing from General Mills investment arm 301 Inc, said it remained committed to rolling out its products globally.
“Although market conditions were challenging, international expansion went as planned with a successful roll out into 700 Kroger stores in the US following a successful trial in 200 stores in 2020,” Thomson said.
He noted that it was on course to wipe out last year’s sales drop and post two-year growth, with sales expected up by around 40% so far in 2022.
Thomson said the brand had resisted passing on significant cost increases to consumers as “range rationalisation, significant manufacturing efficiencies and concept amendment have meant we’ve only had to pass on a fraction of our cost increases to consumers”.
General Mills’s venture capital arm 301 Inc invested an initial £5m into Pots & Co to help fund its US expansion, with the sum potentially rising to a maximum of £15m ($20.5m).
The accounts show the group received a further £2.4m of investment in January 2022, another £1m in July and it has had a further £2.5m of investment committed on October 2022 (of which £1.6m is “irrecoverably committed” and a further £1m expected in March 2023).
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