Costs crunch at biscuit firm

UNITED Biscuits UK saw its operating profits jump by 10.4 per cent to £218.5m last year, its latest accounts published on Companies House show.

The increase in earnings came despite revenues growth of just one per cent to £1.06bn, with cost-savings driving the bulk of the earnings boost at the UK arm of the company that makes Jaffa Cakes, Mini Cheddars, Hula Hoops and other consumer essentials.

It compares favourably with an increase of 3.3 per cent in operating profit at the firm’s parent company, United Biscuits Topco, showing that Britons’ hunger for biscuits held up despite a difficult year for UK consumers.

But the accounts also show that the UK suffered most from the costs crunch, with a headcount crumbling by five per cent to 6,169. That compares to a 0.5 per cent drop in employee numbers globally, which came in at 8,323 last year.

The cost savings were a welcome sight for shareholders, however, who saw their equity increase by 23 per cent to £549.1m. The company also said that it benefited to the tune of £2.1m from a decrease in Britain’s corporation tax.

United Biscuits UK and its parent company is 90 per cent joint-owned by private equity firms Blackstone and PAI Partners, with the management owning the rest. It accounts for 26 per cent of the UK’s biscuit market.