Great Witchingham-based Bernard Matthews’ �10m investment

Bernard Matthews Farms has announced that it is to invest an extra �10m in its UK business this year– its biggest since 2006 – just a year after the group recorded a loss of �6.6m.

High feed costs, extreme weather conditions and economic problems in Hungary were blamed for the operating loss in its results for the 18 months ending July 3, 2011, which will be filed on Friday.

This compares to a �2.5m profit for the previous 12 months, ending January 2010.

The firm has moved its accounting year end to July in a move it said would help it to plan and budget with its Christmas performance results.

On Friday it will also file group sales of �470.8m for the 18-month period, compared to the previous 12-month �330.5m figure.

The news of investment comes at the end of a turbulent six years for the company which was hit by avian flu in 2007, just two years after Jamie Oliver sparked a national food debate by criticising Bernard Matthews' turkey twizlers.

Managing director Rob Mears said that the firm had been hit by high feed costs in 2010.

Most Read

'Feed costs have stabilised and we did manage to recover some costs from our major customers. There was a degree of time lag between being impacted by the food costs and being able to recover those costs,' he said. The multi-million pound loss was also caused by the poor weather in November and December 2010 which meant the turkeys needed more heat and food at a time when they put on the most weight.

Bernard Matthews' subsidiary company in Hungary was also hit by the devaluation of the currency and VAT increase on food in the country.

Mr Mears added that the Hungary business and the German business were a small part of the overall business which was dominated by the UK part of the group.

He said that since the year end last July the firm had seen an 'outstanding' Christmas and an expansion of turkey consumption in the UK, adding: 'As a result of that and the ongoing investment and the fact we are controlling our costs pretty well, the UK has been at its highest level since 2006.'

The company has started work on a �3m expansion to its Great Witchingham Southside facilities.

'We are extending the factory and putting in the latest processing equipment. We are modernising and improving efficiency,' said Mr Mears. The company is also expecting to start looking for new farms to add to its existing 50 across Norfolk, Suffolk and Lincolnshire.

Mr Mears said its work with Bernard Matthews' ambassador Marco Pierre White was part of a campaign to double the amount of turkey consumed in the UK over the next decade and bring it back to the same level it was a decade ago.

He explained: 'We already know we are going to need to produce another 400,000 frozen whole birds this Christmas. Demand is strong and we've been successful in gaining commitments to sell more birds. We are investing for the future here.'

He said that the 2,100 year-round UK staff could look forward with a fair degree of optimism for the future.

As well as more than 2,000 full-time staff, the company also takes on a further 800 people each Christmas.

As well as the �3m in Great Witchingham, the company is also hoping to invest �4m at its Holton site near Halesworth, where it is hoping to get planning permission for an anerobic digestion plant. The extra planned expenditure will be on smaller improvements to agriculture and the factories.

Become a Supporter

This newspaper has been a central part of community life for many years. Our industry faces testing times, which is why we're asking for your support. Every contribution will help us continue to produce local journalism that makes a measurable difference to our community.

Become a Supporter