Operating profits at Foyle Food Group holdings for 2023 were £21.6m (€25.4m), a significant increase on the £12.9m (€15.3m) in 2022. The bottom-line profit for the year after all costs and expenses are deducted was £14.4m (€16.9m) compared with £9.3m (€10.9m) for 2022.
This was achieved on a marginal increase in turnover at £491.8m (€578.6m), up from £482m (€567.1m) the previous year. An interim dividend of £1.650m (€1.941m) was paid in April this year.
The Foyle Food Group are a beef processing business centred in the north west with factories in Donegal, Derry and Tyrone plus two in England.
Across the group in 2023, 1,334 people were employed, fractionally lower than the 1,340 in 2022 though the employee costs which include pension and social security costs, were higher at £43.7m (€51.4m) in 2023 compared with £43.1m (€50.7m) in 2022.
Distribution costs fell significantly in 2023, down from £17.1m (€20.1m) the previous year to £14m (€16.5m) last year. The company also benefited from a research and development credit of just over £1.6m (€2m) in 2022.
Interest costs were higher at £3.3m (€3.9m) compared with £1.8m (€2.1m) the previous year while higher profits meant a total tax charge for the year of at £3.8m (€4.5m) in 2023 compared with £1.9m (€2.2m) the previous year.
The increase in UK corporation tax from 19% to 25% in April 2023 added to the precessor’s tax cost.
Sustainability
The company also reported that progress on reducing their scope 1 and 2 emissions is ahead of target – they have achieved a 27% reduction on 2019 levels having had a target of a 14% reduction by the end of 2025.
Scope 3 emissions which are those generated upstream of the processing business remain a challenge and using industry average emissions factors, account for 89% with cattle being the main cause. The business moved to using entirely renewable sourced electricity and the factory in Campsie uses energy produced by anaerobic digestion.
About Foyle Food group
The Foyle Food Group (FFG) are a substantial beef processing company that is owned by the Acheson family and headquartered in Omagh Co Tyrone.
The business was originally established in the late 1970s with a cattle, sheep and pig processing plant in Campsie, Co Derry. Acquisitions were made in the 1990s of beef abattoirs in Carrigans, Co Donegal and Omagh, Co Tyrone followed by two more factories in England in 2012 and 2013.
The business is focused on beef processing with the capacity to handle up to 350,000 cattle annually across the five sites. It is headquartered at the Omagh location where there is also retail packing and further processing capacity. The business has a long-standing supply arrangement with Tesco and major European retailers through the Hilton Food Group and is also a long-established supplier to OSI, the major manufacturer of burgers for McDonalds.
The Foyle Food Group factory on site in Carrigans Co Donegal is right by the border and less than 20km from their factory outside Derry city. A separate set of accounts is available for the company that trades as Donegal Meat Processors.
They show a profit for the financial year of €2.867m in 2023 on a turnover of €126.237m, which is up from a profit of €1.724m the previous year on a turnover of €130.969m.
The business made substantial savings on distribution costs in 2023, which were down from €3.6m in 2022 to €3.1m in 2023 and administrative expenses were down from €3.7m the previous year to €3.4m.
It also benefited from a Research and development tax credit of €615,026.
Employee costs increased from €8.4m to just over €9m with on average 237 employed in production, up from 223 the previous year and 15 in administration, down from 21 in 2022.
Analysis
The FFG factory in Donegal gives an insight into the profitability of beef processing for a factory handling in the region of 60,000 to 70,000 cattle.
Their operating margin of 3.8% of turnover is within the range expected in the industry and the bottom line profit for the financial year of €2.9m would equate to approximately 12c/kg or just over €40 per head, based on an estimated 65,000 kill.
In absolute money terms, any business that leaves a bottom line approaching €3m is lucrative but relative to turnover, it again confirms that meat processing is a low-margin business, as is the agrifood industry in general with profits driven by high throughput generating high turnover.
Factory leagues placing
The FFG Donegal factory is one of the ones that report the prices paid to farmers for the cattle they buy on a weekly basis. This weekly data is analysed by the Farmers Journal on an annual basis and Foyle’s Donegal factory regularly features well up the table across all categories. For 2023, they had one top place, three second places and two third places over the 16 categories analysed.
Looking at the FFG as a whole, it is clear that the strong performance in 2023 wasn’t confined to the Donegal factory. Operating profit increased to £21.6m (€25.4m) for a margin of 4.4% compared with £13m (€15.3m), a 2.7% margin in 2022.
This was delivered with a very small increase in turnover meaning that the higher earnings were delivered by improved margins, not just more business.
The company have invested heavily in further processing and retail packing facilities at their Omagh site in recent years and that investment is now clearly paying off for the group.
General beef trade
No doubt Foyle, like other beef processors, are benefiting from strong demand for beef in the UK and across the EU over recent times.
Cattle supplies have been tighter in many countries and South American exports have been more geared towards Asia and the US than Europe.
A further development over the past 18 months is the growing demand for beef cuts as opposed to just mince and burgers.
Steak meat sales have been consistently strong at retail level, encouraged by keen supermarket pricing in the UK.
Even the roasting cuts have been selling better and along with consistent demand for mince and manufacturing beef from forequarter carcase balance is being achieved, which also contributes to the factory’s bottom line.
Foyle Food Group – beef factories in Donegal, Derry, Tyrone and two in England.1,334 employees.2023 profit £14.4m (€16.5m), turnover £491.8m (€578.6m).Scope 1&2 emissions reduced by 27% on 2019 levels.Factory performance underpinned by robust demand for beef in UK and EU.Lower operating costs in 2023.Similar number of staff but higher costs.
Operating profits at Foyle Food Group holdings for 2023 were £21.6m (€25.4m), a significant increase on the £12.9m (€15.3m) in 2022. The bottom-line profit for the year after all costs and expenses are deducted was £14.4m (€16.9m) compared with £9.3m (€10.9m) for 2022.
This was achieved on a marginal increase in turnover at £491.8m (€578.6m), up from £482m (€567.1m) the previous year. An interim dividend of £1.650m (€1.941m) was paid in April this year.
The Foyle Food Group are a beef processing business centred in the north west with factories in Donegal, Derry and Tyrone plus two in England.
Across the group in 2023, 1,334 people were employed, fractionally lower than the 1,340 in 2022 though the employee costs which include pension and social security costs, were higher at £43.7m (€51.4m) in 2023 compared with £43.1m (€50.7m) in 2022.
Distribution costs fell significantly in 2023, down from £17.1m (€20.1m) the previous year to £14m (€16.5m) last year. The company also benefited from a research and development credit of just over £1.6m (€2m) in 2022.
Interest costs were higher at £3.3m (€3.9m) compared with £1.8m (€2.1m) the previous year while higher profits meant a total tax charge for the year of at £3.8m (€4.5m) in 2023 compared with £1.9m (€2.2m) the previous year.
The increase in UK corporation tax from 19% to 25% in April 2023 added to the precessor’s tax cost.
Sustainability
The company also reported that progress on reducing their scope 1 and 2 emissions is ahead of target – they have achieved a 27% reduction on 2019 levels having had a target of a 14% reduction by the end of 2025.
Scope 3 emissions which are those generated upstream of the processing business remain a challenge and using industry average emissions factors, account for 89% with cattle being the main cause. The business moved to using entirely renewable sourced electricity and the factory in Campsie uses energy produced by anaerobic digestion.
About Foyle Food group
The Foyle Food Group (FFG) are a substantial beef processing company that is owned by the Acheson family and headquartered in Omagh Co Tyrone.
The business was originally established in the late 1970s with a cattle, sheep and pig processing plant in Campsie, Co Derry. Acquisitions were made in the 1990s of beef abattoirs in Carrigans, Co Donegal and Omagh, Co Tyrone followed by two more factories in England in 2012 and 2013.
The business is focused on beef processing with the capacity to handle up to 350,000 cattle annually across the five sites. It is headquartered at the Omagh location where there is also retail packing and further processing capacity. The business has a long-standing supply arrangement with Tesco and major European retailers through the Hilton Food Group and is also a long-established supplier to OSI, the major manufacturer of burgers for McDonalds.
The Foyle Food Group factory on site in Carrigans Co Donegal is right by the border and less than 20km from their factory outside Derry city. A separate set of accounts is available for the company that trades as Donegal Meat Processors.
They show a profit for the financial year of €2.867m in 2023 on a turnover of €126.237m, which is up from a profit of €1.724m the previous year on a turnover of €130.969m.
The business made substantial savings on distribution costs in 2023, which were down from €3.6m in 2022 to €3.1m in 2023 and administrative expenses were down from €3.7m the previous year to €3.4m.
It also benefited from a Research and development tax credit of €615,026.
Employee costs increased from €8.4m to just over €9m with on average 237 employed in production, up from 223 the previous year and 15 in administration, down from 21 in 2022.
Analysis
The FFG factory in Donegal gives an insight into the profitability of beef processing for a factory handling in the region of 60,000 to 70,000 cattle.
Their operating margin of 3.8% of turnover is within the range expected in the industry and the bottom line profit for the financial year of €2.9m would equate to approximately 12c/kg or just over €40 per head, based on an estimated 65,000 kill.
In absolute money terms, any business that leaves a bottom line approaching €3m is lucrative but relative to turnover, it again confirms that meat processing is a low-margin business, as is the agrifood industry in general with profits driven by high throughput generating high turnover.
Factory leagues placing
The FFG Donegal factory is one of the ones that report the prices paid to farmers for the cattle they buy on a weekly basis. This weekly data is analysed by the Farmers Journal on an annual basis and Foyle’s Donegal factory regularly features well up the table across all categories. For 2023, they had one top place, three second places and two third places over the 16 categories analysed.
Looking at the FFG as a whole, it is clear that the strong performance in 2023 wasn’t confined to the Donegal factory. Operating profit increased to £21.6m (€25.4m) for a margin of 4.4% compared with £13m (€15.3m), a 2.7% margin in 2022.
This was delivered with a very small increase in turnover meaning that the higher earnings were delivered by improved margins, not just more business.
The company have invested heavily in further processing and retail packing facilities at their Omagh site in recent years and that investment is now clearly paying off for the group.
General beef trade
No doubt Foyle, like other beef processors, are benefiting from strong demand for beef in the UK and across the EU over recent times.
Cattle supplies have been tighter in many countries and South American exports have been more geared towards Asia and the US than Europe.
A further development over the past 18 months is the growing demand for beef cuts as opposed to just mince and burgers.
Steak meat sales have been consistently strong at retail level, encouraged by keen supermarket pricing in the UK.
Even the roasting cuts have been selling better and along with consistent demand for mince and manufacturing beef from forequarter carcase balance is being achieved, which also contributes to the factory’s bottom line.
Foyle Food Group – beef factories in Donegal, Derry, Tyrone and two in England.1,334 employees.2023 profit £14.4m (€16.5m), turnover £491.8m (€578.6m).Scope 1&2 emissions reduced by 27% on 2019 levels.Factory performance underpinned by robust demand for beef in UK and EU.Lower operating costs in 2023.Similar number of staff but higher costs. 
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