Seabrook: Crisps brand issues warning over Rachel Reeves’ tax hikes
The company behind crisps brand Seabrook has warned Chancellor Rachel Reeves’ Autumn Budget tax hikes will have an impact on its bottom line this year.
The Cheshire-based UK arm of Japanese giant Calbee pointed to the increase in the National Living Wage and employers’ National Insurance contributions, which came into affect in April, as key challenges the brand will face for the rest of 2025.
The maker of Seabrook added that it also expects to battle with rising raw material costs – the likes of potatoes and oil – alongside labour.
However, the brand said it still expects its turnover to rise during its current financial year and is also forecasting its operating profit to improve.
The concerns about the impact of Reeves’ tax hikes have been included in the firm’s latest accounts for 2024 which have been filed with Companies House.
For the year, the maker of Seabrook has posted a turnover of £71.6m, up from £66.3m, while its pre-tax profit slipped from £6m to £5.2m.
City PM reported last year that the firm was to bring forward its major investment plans after its profit almost doubled in 2023.
Seabrook is headquartered in Bradford and was acquired by Calbee in October 2018, having previously been 75 per cent owned by LDC and 25 per cent by the management team.
Calbee’s brands also include Harvey Snaps and licenses Peppa Pig products.
Seabrook maker looking to get back on track
A statement signed off by the board said: “2024 proved to be a challenging year for Calbee Group UK driven mainly by a delay in a large capacity expansion project at the Bradford site and ongoing cost pressures.
“On the latter, potatoes, oil and labour were the key cost challenges faced in the second half of the year, with most raw materials increasing and we expected this trend to continue into 2025, especially given the increase in the National Living Wage and employers’ National Insurance contributions.”
The group said the expansion of its Bradford site was the largest project it has ever undertaken and saw its crisps production capacity “increase considerably”.
However, the Seabrook maker said it “experienced some delays through the commissioning phase which meant our stock position was under huge pressure throughout the summer and into Christmas”, limiting its ability to sell through the fourth quarter.
The group added that its operating profit deliver was “hampered by these commissioning issues which drove waste losses and poor labour recovery vs norms” from September to December.
That period is normally the most profitable for the group, it added.
On its future, the Seabrook maker said: “As we move into 2025, our service out of Bradford has now fully recovered and we are consistently delivering a weekly service level, in line with customer expectations out of both production sites.
“Recovering cost and getting back to delivering a consistent service level in 2025 will enable the business to get back on track quickly, and with new capacity available, a strong new product development pipeline and a strengthening brand, we expect to continue our sales growth in 2025 and see operating profit return to levels more typical of our historic performance.”
Seabrook started in Bradford as a fish and chip shop in 1939 and began selling crisps in 1945.