A pet food manufacturer which was bought out of administration has been turned around, with capital investment of £400,000 in the last year and a growth rate of 18%.
Winkleigh-based Forthglade Ltd went into administration in September 2011 after hitting cashflow problems. It was subject to a management buy in/buy out (BIMBO) deal that saw a five-strong team buy the business.
Four weeks after entering administration it was sold as a going concern to the newly formed Forthglade Foods Ltd.
Since then, joint managing directors Gez Lovell and Chris Brooking have been working to turn around the fortunes of the business.
This has included price increases, more negotiations with suppliers to drive down costs and working to make the production process more efficient.
“It was an interesting business with a very good product and a good customer base. It had those two things right but the financial costings were wrong,” said Mr Lovell, who has a background in working with small manufacturing businesses.
Revenue levels began to rise in the first quarter following the BIMBO and the company has subsequently notched up growth rates of 18%.
Turnover currently stands at £4.5 million, with the management team seeking to increase this to £6 million.
The business currently exports around 15% of its products, mainly to Europe, although it is currently considering new markets in a bid to increase overseas sales.
Although around 25 employees were made redundant while it was in administration, Forthglade remains the largest employer in Winkleigh, with a payroll of 58.
Recent investment has seen three new packaging lines installed as well as a programme of repairs to the firm’s 30,000sq ft base – something that has helped to boost staff morale.
“We feel that the product and the team and the customer base warrant that investment and it makes us stronger in the marketplace,” said Mr Brooking, who has a background working for large corporates, including Heinz.
“Hopefully the investment we’re making and the changes have increased morale on site. We’re finding that if suppliers come here and they haven’t been on site for 12 to 18 months, they can’t believe the difference in atmosphere,” added Mr Lovell.
The business, which was originally started in 1971, specialises in making high end pet food, with a focus on natural ingredients.
Exeter financial firm Prydis worked to bring insolvency experts Begbies Traynor in as administrators as well as introducing Mr Lovell to the business.
Prydis chairman Bruce Priday is now chairman of Forthglade Foods.
“It went into and out of administration quite quickly. The amount paid for the business had paid for itself within three and a half months,” he said.
“As with so many of these things it’s been all about the people. Gez and Chris are a dream team and the business has flown over the last 18 months. We’re now looking at where it can go.”