Simpsons Malt Limited has reported an increase in profits from 2020 to 2021 as end user markets recovered following the easing of COVID-19 pandemic restrictions.
The fifth-generation, family-owned company, which includes agricultural merchanting division McCreath Simpson & Prentice, recorded a profit before tax of £7.1million (2020: £4.7million) from a turnover of £214.2million (2020: £123.5million).
The company’s financial year (January 1 – December 31) was headlined by the acquisition of the grain trading business of W.N. Lindsay Limited on January 30, 2021.
The acquisition expanded the merchanting division of the business and its malting barley storage infrastructure, with the company taking on ownership of four grain storage sites across Scotland: Gladsmuir (East Lothian), Keith (Morayshire), Stracathro (Angus) and Sidlaw (Perthshire).
Throughout the rest of the year, W.N. Lindsay Ltd was integrated into the company’s business systems. On December 31, 2021, the entire business of W.N. Lindsay Ltd transferred to Simpsons Malt Ltd and, as a result, W.N. Lindsay Ltd no longer trades.
During the first quarter of 2021, the malting division saw sales volumes and margins recover to near pre-pandemic levels, and this was sustained throughout the remainder of the year.
The merchanting division, together with the trading activities of W.N. Lindsay Ltd, had a mixed year. Sales of crop inputs performed very well, but increasing cereal values presented difficulties in securing wheat and this, combined with haulage costs, meant wheat trading margins were eroded.
A major focus throughout 2021 was on the continued safety and wellbeing of employees, with protective measures implemented during 2020 kept in place. In December 2021, Simpsons Malt Ltd entered a partnership with Plumm Health, giving employees access to on-demand, online mental health wellbeing services. The company also accelerated its annual pay award to support employees with cost of living pressures, with this support continuing into 2022.
Significant investments were made in pursuit of sustainability objectives. HVO fuel was introduced into most of the company’s haulage fleet, reducing net CO2 emissions from each wagon by up to 90%, while more than 400 contracted malting barley growers were assisted in becoming verified to the Farm Sustainability Assessment (FSA) to Gold performance level.
The year ended with Simpsons Malt Ltd becoming a Certified B Corporation®, joining a growing group of companies reinventing business by pursuing purpose as well as profit. At the time of certification, Simpsons Malt Ltd was the only the malting company in Europe to have achieved B Corp status.
Speaking about the financial results for 2021, Simpsons Malt Ltd Managing Director Tim McCreath, right, said: “We’re delighted to report a solid set of financial results in a year that saw us make significant investments in our business operations, sustainability objectives and our people.
“While demand for malt, cereals and crop inputs remains robust and the prospects of the company appear healthy, we are very mindful of the potential impacts of global events on the business – such as Russia’s decision to invade Ukraine – and we continue to exercise caution and prudence in day-to-day and strategic decision making.”