Mole Valley Farmers reports a solid performance for the year ending September 2022 despite continued uncertainty and market volatility.
The British farmer-owned business reports an 18% increase in revenue, with total turnover standing at £615m and a group operating profit of £4.5m.
Inflationary pressures contributed to the increase in revenue, with the 2021-22 trading year dominated by the ongoing effects of the global pandemic, continued implications from Brexit, alongside the war in Ukraine. As a result, rising costs, disruption to supply chains and a difficult labour market made for challenging trading conditions.
Mole Valley Farmers CEO Jack Cordery said the business had worked hard to mitigate the impacts of significant inflationary pressures and supply chain disruption for its shareholders through its purchasing power, strong supplier relationships and driving efficiencies through the business.
“Our focus has remained on delivering exceptional value through the services and products we provide to our Farmer Shareholders and wider customer base. I am pleased that with our cooperative ethos, we have used our scale and relationships to support our shareholders in a volatile year and we recognise their ongoing commitment to the business.”
Mole Valley Farmers returned £2.2m to shareholders and members during the year. This was in the form of a new loyalty bonus scheme that was introduced in 2021, with almost £300K paid out to shareholders in its first year. In addition, more than £1.9m was returned to shareholders and members through point-of-sale retail discounts.
The overall membership base grew by 8% in the year whilst the number of trading non-member customers grew by 1%.
Jack added: “Our shareholders and members are at the heart of this business and we place great importance on our Farmer Shareholder and Country Member schemes which reward loyalty and commitment.
“Cooperation and collaboration are important tools in the armoury of the UK’s farmers to navigate through the changing dynamics of the agricultural supply chain. Our new loyalty bonus reflects the importance of Farmer Shareholders to our business and our cooperative ethos. By working together, we are stronger together.”
There was a strong performance from the group’s 56 retail stores. Turnover was down slightly against the previous exceptional year when many retailers were forced to close as a result of lockdowns, but revenue was up nearly 10% against 2019-20. Online sales grew by 18% in 2021-22.
Whilst the direct to farm Feed business experienced a challenging year, primarily as a result of significant supply chain disruption exacerbated by a shortage of HGV drivers, the business is confident in its long-term strategy with continued investment in infrastructure, nutritional teams and products placing it on a strong footing for the future.
A total of £5.4m has been invested into the feed manufacturing and distribution business and this includes a £4m investment into the Lifton feed mill, located on the Devon / Cornwall border. This will increase raw material storage capacity, improve efficiencies, allow improved diet formulation accuracy and bring many health, safety and environmental benefits.
The business also has an expanding programme of products and services under its Climate Positive Agriculture initiative as it works to help farmers understand and meet the growing environmental challenge and the need to reduce carbon footprints.
Jack indicated that challenging trading conditions would continue into the year ahead, with no likely reduction in costs and continued uncertainty for farmers and the wider sector.
“Supply chain volatility, downward pressure on farm gate prices, the ongoing drive to meet environmental obligations and the transition to more sustainable food production present challenges for all of us. However, we have an absolute commitment to support our shareholders and members, with our business investing for the future, adapting and evolving to help them maximise their productivity, profitability and sustainability.”
Farmer Shareholders are invited to attend the Annual General Meeting of Mole Valley Farmers which takes place on Friday 31st March at 10:30am at Sandy Park, Exeter, Devon.