Household cleaning products firm McBride has been left nursing an 18% slump in annual profits due to “unprecedented” material price hikes as the lorry driver shortage and supply chain issues take their toll.
Amd it has warned that the cost of products will have to increase as a result.
The group, which is behind many supermarkets’ own brand cleaning products, posted underlying pre-tax profits of £19.9 million for the year to June 30, down from £24.2 million the previous year.
It said it has seen an “exceptionally fast escalation in input costs” since early spring, with cardboard costs more than 50% higher than they were a year ago and certain solvents more than 300% higher.
McBride expects the peak of the cost pressures in the autumn and is having “urgent” discussions with retailers as it looks to protect its margins by hiking prices, while it is also cutting costs by about £10 million.
The group said: “The size of cost increases in materials including plastics, cardboard and surfactants is unprecedented, and is coupled with challenges with freight availability and costs adding further inflationary pressures.”
McBride kept its 2021-22 outlook unchanged after warning last month that profits could tumble by up to 65%.
