Muntons Annual Review 2016
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made<br />
<strong>Annual</strong><br />
<strong>Review</strong><br />
<strong>2016</strong>
<strong>Muntons</strong> Made<br />
Welcome...<br />
to our <strong>2016</strong> annual review. This<br />
year we have focused on malt as an<br />
ingredient used in many foods and<br />
drinks - some you may know, others<br />
you may be surprised to learn!<br />
We hope you will enjoy reading<br />
about what has been a very exciting<br />
and productive year for <strong>Muntons</strong>.<br />
Do get in touch if we’ve missed<br />
anything or if you’d like to know<br />
more. As ever, there are many news<br />
stories that didn’t quite make it to<br />
the final edit.<br />
Inside<br />
Chairman’s Statement 03<br />
Managing Director’s Report 04<br />
Wishful Drinking 05<br />
Sensational Summer Salad 06<br />
News in Brief 07<br />
Well Worth Waiting For 08<br />
Malty Bits 10<br />
Pure Pleasure By The Pint 12<br />
Technology 14<br />
International News 16<br />
Our Most Decadent Dessert 18<br />
Focus on Education 20<br />
Cutting Edge Laboratory Upgrade<br />
gets Results Fast 22<br />
<strong>Muntons</strong> Ingredients Overview 23<br />
<strong>Muntons</strong> Malt Overview 24<br />
Our Year In Numbers 26<br />
GO FIGURE<br />
<strong>2016</strong> FINANCIALS IN BRIEF<br />
£11.3M<br />
EBITDA<br />
20.2%<br />
RETURN ON CAPITAL EMPLOYED<br />
£90.33M<br />
TURNOVER<br />
£7.53M<br />
PRE-TAX PROFIT<br />
193,583<br />
TONNES OF MALT SALES<br />
28,197<br />
TONNES OF LIQUID EXTRACT<br />
2.44GWH<br />
ELECTRICITY GENERATED<br />
3,773<br />
SAMPLES SENT TO CUSTOMERS<br />
28,000<br />
SAMPLES ANALYSED IN OUR LABORATORIES<br />
Our results were level with 2015 but we increased our volume sales<br />
by 5%. Overall sales value was slightly down on last year at £90m,<br />
mainly due to a higher proportion of exported sales, and an operating<br />
profit of £8.7m was below last year as depreciation costs and<br />
overheads grew.<br />
The joint venture company in Thailand has been challenged by<br />
commissioning problems and beset by bureaucracy. Had it performed<br />
as projected we would have set another record for the company’s<br />
earnings, but it does give us grounds for optimism this year as the<br />
sales activity begins to grow in South East Asia.<br />
We completed the year with our bank debt down to £23m having<br />
invested £5.7m in the year on capital projects. The completion of<br />
the new barley intake and drying plant at Stowmarket is a major step<br />
forward in the improvement plan for the site. The major overhaul of<br />
our information systems, using SAP S/4Hana has been delayed as we<br />
extended the functionality to be implemented in the first phase and<br />
it will now be live in July 2017.<br />
Although our return on capital is two percentage points lower than<br />
last year, we have been in a period of intense investment and our<br />
forecast returns are delayed on some projects. The anaerobic digester<br />
for example is working extremely well and generating over 14% of<br />
our Stowmarket site electricity requirement but to complete the<br />
project we have struggled to secure the licensing needed for the<br />
recycled waste to be sold on as fertiliser, due to bureaucratic<br />
wrangling between the agencies involved.<br />
In the second half of the year we decided to put our financial audit<br />
out to tender. The successful company was Ipswich-based BDO and<br />
muntons malt -<br />
the key ingredient for success<br />
CHAIRMAN’S STATEMENT<br />
This year under review will go down in history for the referendum decision to leave the European<br />
Union with all its many anticipated consequences. Your company has continued with a clear<br />
strategy to invest for growth and build for the future with projects that will reduce environmental<br />
impact and increase financial performance.<br />
they have now carried out their first audit of this year’s results. Last<br />
year I mentioned that we were obliged to move to a new method of<br />
accounting - FRS102 - and this has been a hugely frustrating task<br />
with no particular benefit to the company or the shareholders.<br />
The executive team under Alan’s guidance have managed the<br />
business very well this year in a landscape of great uncertainty. There<br />
are many questions around the future of our supply chain and our<br />
sales markets, from the continued availability of sufficient barley to<br />
the prospect of export tariffs. As we confront these challenges you<br />
can rely on the whole leadership team to plan and anticipate<br />
effectively.<br />
It goes without saying that this year has been another example of the<br />
successful teamwork which characterises your company. On behalf of<br />
the board I extend thanks to everyone who has worked so hard, in all<br />
areas and countries, to make this another successful year for<br />
<strong>Muntons</strong>.<br />
The new year has commenced well and we are already seeing steady<br />
improvements in the trading position. We are working well within our<br />
banking facilities and with our positive cash generation are continuing<br />
to assess new projects for 2017 which can enhance sustainability.<br />
Your company has many opportunities for growth and we will<br />
make sure we take them.<br />
Paul Wells, Chairman<br />
2 3<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
made by muntons:<br />
the place, people & product<br />
MANAGING DIRECTOR’S REPORT<br />
Malt is a marvellous ingredient. It brings majesty to beer and whisky and magic to a whole range of<br />
everyday and exotic foodstuffs. From malt loaves to malt beverages, soups to sauces, colas to cakes,<br />
the list is as long as we wish to make it. It is such a privilege to lead our people in a business with<br />
the success we have enjoyed and the potential still yet to come. Yes, we are passionate about malt<br />
but we are also passionate about <strong>Muntons</strong>.<br />
Welcome to this year’s <strong>Annual</strong> <strong>Review</strong> this time designed in a<br />
magazine type format. “<strong>Muntons</strong> Made” is aimed at showing,<br />
in a hopefully highly readable fashion, how valuable malt is as<br />
an ingredient and of course the pride we have in our people and<br />
our sites.<br />
If I had to summarise <strong>2016</strong> in two words I think they would be<br />
“eventful year”. The repercussions of the decision to leave the<br />
European Union are still reverberating around our operating<br />
environment. The shock waves will continue to do so for some time<br />
as we understand and adapt to the consequences of the negotiated<br />
details of our exit. There will be effects on currency which in turn will<br />
affect raw material prices as essentially all grain in the world has a<br />
direct link to the US dollar. If the pound remains weak then we will<br />
have competitive advantage selling into certain markets balanced,<br />
as I say, by increased barley costs. And will farmers be able to<br />
maintain the right levels of commitment to growing our undeniably<br />
specialist malting barley crop in light of this uncertainty? The subject<br />
of trade tariffs and bilateral agreements hangs heavy too. Maybe we<br />
will have some answers in 2017! In the meantime, we will just get on<br />
with it. We are all Brexiteers now!<br />
Malt sales at 98.5% of budget, whilst respectable, were affected by<br />
delays in customer offtake through causes outside of their control.<br />
We achieved record production levels in Malt and continued high<br />
performance figures for extracts and powders in our Ingredients<br />
division. Whilst performances in the USA and from the joint venture<br />
were below par, our intention is to continue to address issues in<br />
both of these areas as they offer such huge potential, providing<br />
great building blocks for the future. Along with these volume<br />
increases we are also seeing margin enhancements, which bode<br />
well for ongoing profits.<br />
Harvest <strong>2016</strong> was an eye opener for many, a very volatile period<br />
following unusual weather patterns and fuelled by post referendum<br />
currency chaos. Winter barley in East Anglia was poor, the worst<br />
quality for many years, whilst the Yorkshire crop was much nearer<br />
normal. Spring barleys came through well though and more than<br />
made up for the winter deficit, but at a price, as the weak pound<br />
pushed levels up. Our challenge was to time grain pricing with the<br />
most advantageous movements in sterling. Areas of East Anglia also<br />
had problems with ergot, a fungal infection of the barley ear which<br />
matches healthy grain size for size. Many of our competitors<br />
appeared to fail to see the amount present in deliveries, which<br />
did restrict supply to us for a while as sellers took the easy, if risky,<br />
option to sell elsewhere. Our new Stowmarket intake and drying<br />
plant therefore was never subject to harvest pressure as intended<br />
although our intake team certainly were pressured as they diligently<br />
dealt with the consequences.<br />
Looking forwards, our new SAP S/4Hana computer system will<br />
enable far quicker and improved understanding of the details of<br />
our business. Couple this with our major investment in a new grain<br />
drying facility and our ability to buy as effectively as possible is<br />
significantly enhanced. Being able to handle a far greater volume<br />
of grain immediately after harvest puts our grain buyers in a strong<br />
buying position whilst, at the same time, securing the supply chain in<br />
a collaborative way. As always, we are conscious of the importance<br />
of controlling input costs. In spite of the uncertainty that Brexit has<br />
introduced we are an agile business with hedging policies in place<br />
designed to minimise risk and gain maximum advantage.<br />
We continued our capital investment programme looking to ensure<br />
the sustainability of the business, involving almost £6M invested in<br />
projects to improve our efficiency and our product quality. We topped<br />
the tables as favoured suppliers to many customers and maybe due to<br />
Brexit uncertainty we completed sales much earlier than customary,<br />
which will ensure high levels of profitable activity through 2017.<br />
There were many other positives and some of these are featured<br />
in this <strong>Annual</strong> <strong>Review</strong>. We are confident that we can move forward<br />
now and expect to enjoy an active year in 2017.<br />
Alan Ridealgh, Group Managing Director<br />
wishful<br />
DRINKING<br />
Malt extract has been used in hot bedtime drinks<br />
for years but is also delicious in chilled milkshakes<br />
or ‘malts’ as they are called in the USA and as a<br />
refreshing energy drink in Southeast Asia. Shake up<br />
your milkshake with a dash of malt to bring out its<br />
irresistible flavour and transport yourself to<br />
your very own American Diner.<br />
4 5<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
NEWS IN BRIEF<br />
Sensational<br />
summer salad<br />
A perfect light lunch<br />
WE’RE<br />
COMPLETELY<br />
BATTY!<br />
positive<br />
energy<br />
£2.6 million has been invested in our grain<br />
intake area, creating not only a faster and<br />
more streamlined facility, but one that lowers<br />
our energy consumption and reduces the<br />
number of local truck movements.<br />
Looking for a lovely light lunch then look no further. A dash of<br />
malt extract in the mustard vinaigrette and crispy smoked bacon<br />
coated with malt extract, grilled to perfection, add the perfect<br />
finishing touches to this fresh mixed salad. With onions pickled<br />
in malt vinegar and crispy croutons baked using malt flour you<br />
might think that salads were made with malt in mind.<br />
From willow tree to cricket pitch: How<br />
trees felled at <strong>Muntons</strong> have been made<br />
into cricket bats. A new crop for the<br />
maltster to work with. Howzat!<br />
In October, we officially opened our new grain drying<br />
facility with a well-attended ribbon cutting ceremony,<br />
seeing the High Sheriff of Suffolk, WB Kendall Esq DL,<br />
on ribbon cutting duty. This was a major investment<br />
for us, designed to ensure that we remain sustainable<br />
by using only the very best technology available. This<br />
not only increases our ability to process grains more<br />
rapidly but the installation of the 26-metre tall,<br />
state-of-the-art, grain dryer also significantly reduces<br />
our energy consumption, offering improvements in<br />
efficiency of 40%.<br />
Other improvements made at the same time include<br />
a second weighbridge, new grain intake pit, the<br />
construction of a 1,300-tonne grain storage silo<br />
and the refurbishment of our other existing silos.<br />
These new facilities mean that we are now able to<br />
handle 140 tonnes of grain per hour, greatly improving<br />
the turnaround of vehicles delivering grain. Additionally,<br />
we have created a new one-way traffic system on our<br />
site to improve safety by further separating vehicle<br />
and pedestrian movements.<br />
Every thirteen years or so, we arrange to have an expert team ‘fell’<br />
our latest crop of purpose-grown willow trees. This year, nine trees<br />
were felled which will be turned into a fine crop of cricket bats ready<br />
for next year’s sporting season. As soon as they were cropped, eleven<br />
more trees were planted to ensure that the cropping tradition<br />
continues. Growing these trees does not just provide wood for<br />
cricket bats though, the young saplings are good for the<br />
environment too converting carbon dioxide into fresh oxygen.<br />
Not all willow trees can be used to make cricket bats though.<br />
Weeping willow trees for example cannot be used. The ideal<br />
willows are Salix Alba Caerulea (Cricket Bat Willow), which are<br />
ready for cutting when the trunk has a circumference of about<br />
1.5 metres (60 inches) when measured 1.5 metres from the ground.<br />
The <strong>Muntons</strong> site at Stowmarket has a managed flood plain running<br />
alongside the river, which provides exceptional conditions for cricket<br />
bat willows. The roots of the trees benefit from the moist soil and the<br />
trees thrive. This year we plan to have a few commemorative bats<br />
made for posterity – and the occasional <strong>Muntons</strong> cricket match.<br />
6 7<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
well worth<br />
waiting for<br />
Making top quality, single malt, Scotch whisky starts with the<br />
sourcing of the finest raw material – malt of course. But even after<br />
mashing, fermentation and distillation using pure Scottish water,<br />
in a distillery based in Scotland, it will not be deemed to be good<br />
enough to sell as single malt Scotch whisky until it has been stored<br />
and matured in oak casks typically for at least ten years…<br />
During the maturation process, the<br />
permeable oak casks allow air to enter<br />
and evaporation to occur, allowing the<br />
harsher constituents of the new spirit to<br />
be removed leaving a mellow and more<br />
rounded whisky. To be called single malt<br />
Scotch Whisky, it must be made and<br />
matured in Scotland using only malt and<br />
water, without the addition of any other<br />
cereals, from spirit from a single distillery<br />
made by batch distillation in pot stills.<br />
<strong>Muntons</strong> has been supplying malt into the<br />
Scottish distilleries for many years – in fact<br />
our maltings at Bridlington was built<br />
specifically with this in mind more than<br />
50 years ago. Today there is a growing<br />
interest in Scotch whisky from all over<br />
the world and, with 90% of all Scotch<br />
produced being sold overseas, it is one<br />
of Britain’s leading exports, contributing<br />
more than £4 billion towards the balance<br />
of trade.<br />
Distilling spirit from malt is not however<br />
just restricted to Scotland, there is a<br />
growing craft distilling industry in England<br />
and the USA and, of course, Japan has long<br />
been a manufacturer of highly reputable<br />
distilled spirits made using imported malt.<br />
Here at <strong>Muntons</strong> we are proud to be the<br />
supplier of choice into the distilling industry.<br />
Adam Jaime<br />
8 9<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
Of the 18 species of bat in<br />
the UK at least 3 are known<br />
to be at <strong>Muntons</strong>. Staff using<br />
bat detectors spotted Noctule,<br />
Daubenton’s and Common<br />
Pipistrelle bats one evening.<br />
Anaerobic digestion at the Stowmarket site produces methane,<br />
which is used to generate electricity. Between this and the<br />
output from the photovoltaic panels at our Bridlington site,<br />
we can generate sufficient electricity to cover over 8% of our<br />
combined site needs. Power used where it is generated – good<br />
for the environment (and <strong>Muntons</strong> too). See for yourself –<br />
www.psmuntons.com/portfolio/live-energy-usage<br />
proudly sending<br />
ZERO WASTE<br />
TO LANDFILL<br />
We’ve donated a number of site bicycles to the ‘Re-cycle’ project, who<br />
will ship them to their African partners to run bicycle projects across<br />
the continent. Millions of people in Africa are forced to walk on<br />
average four hours every day to get to school, work or to carry heavy<br />
loads such as water, crops and firewood. The Re-cycle bicycles can<br />
cut these journey times down to as little as 20 minutes.<br />
Finding practical ways to introduce sustainability into the<br />
way that business is conducted, led us to coin the phrase<br />
‘P.S. Practical Sustainability: it’s no afterthought’ as<br />
our strapline. We strive to champion our green agenda<br />
and enable our business, and other businesses<br />
within our supply chain, to flourish. Interested?<br />
To find out more about Practical Sustainability<br />
visit www.psmuntons.com<br />
We are the first maltster<br />
in the world to prove<br />
by external verification<br />
that 100% of our malt<br />
is grown sustainably.<br />
The development and<br />
implementation of a<br />
usable carbon footprint<br />
calculator, has helped<br />
us reduce the carbon<br />
footprint of the malting<br />
barley we source by<br />
nearly 40%.<br />
3,000 tanker movements per year were saved following<br />
the construction of our anaerobic digestion plant, saving<br />
around 340 tonnes of CO 2 emissions from the lorries.<br />
£11.3m<br />
Investments in<br />
green initiatives<br />
over the past<br />
6 years<br />
Using a number of innovate techniques, non-hazardous waste to<br />
landfill was reduced to zero at <strong>Muntons</strong> Stowmarket site during<br />
the <strong>2016</strong> year. All waste is now either recycled or recovered. The<br />
challenge initially was to try not to create waste in the first place<br />
but where this was unavoidable, anything being sent to landfill was<br />
clearly identified and alternative ways found to recycle or recover<br />
these using physical and biological processes. Waste not…<br />
over 3,000 trips<br />
We are committed to a continuous<br />
reduction in energy use. Since<br />
our campaign started in 1999, we<br />
consistently achieve better than<br />
the Government emissions targets,<br />
gaining us a reduction in our<br />
Climate Change Levy.<br />
10 11<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
pure pleasure<br />
BY THE PINT<br />
Malted cereal grains are the meat and<br />
potatoes of beer. They provide the sugars<br />
fermented by the yeast to create alcohol<br />
and CO 2 and are the primary source of<br />
beer colour, contributing significantly<br />
to flavour and mouthfeel. Barley malt<br />
is the most common of the malted grains,<br />
although others such as wheat, rye and<br />
oats can be used. In addition to malted<br />
cereals some brewers may choose to<br />
use un-malted grains – maize (corn),<br />
rice, wheat, rye, oats and sorghum<br />
for example.<br />
Malting is the process of controlled<br />
germination, and kilning of the grains.<br />
This activates enzymes within the<br />
grain that start to break down the<br />
hard, starchy insides into simpler<br />
carbohydrates, making them more<br />
accessible for the brewer.<br />
Kilning introduces differing degrees<br />
of colour and flavour to the grains. The<br />
most commonly used malts in the brewing<br />
process are ‘white malts; mainly for ale or<br />
lager malts, which provide base sugars<br />
for the yeast to ferment and introduce<br />
a characteristic light malty flavour.<br />
Crystal or caramel malts are made by<br />
allowing enzymes to convert complex<br />
carbohydrates into simple sugars in the<br />
grain before kilning. Kilning then<br />
caramelises these sugars in the grain.<br />
They are often added to introduce extra<br />
colour and interesting ‘fruity’ flavours to<br />
beer. Roasted malts (and some un-malted<br />
cereals) have their colour intensified<br />
during the roasting process and are<br />
added to beers primarily for their<br />
intense colour in darker beers, such as<br />
ales through to porters and stouts.<br />
12 13<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
TECHNOLOGY<br />
A new dawn for<br />
OUR DIGITAL<br />
LANDSCAPE<br />
BRIGHT<br />
SPARKS<br />
ONLY<br />
Being able to communicate effectively is vital<br />
for any business and this is particularly<br />
true for internal communications within the<br />
business itself. <strong>Muntons</strong> is growing, with its<br />
footprint stretching internationally, therefore<br />
the sensible step was to invest in the<br />
building and establishment of an intranet to<br />
help with staff communications.<br />
Accurate and timely information is the bread and butter of business,<br />
providing the basis from which important decisions are made. The<br />
current SAP system at <strong>Muntons</strong> has been providing our business<br />
information for the last 17 years but the time has now come to upgrade<br />
to a new state-of-the-art information solution: SAP S/4Hana.<br />
A firm foundation is crucial when building<br />
a solid, strong structure and the same is<br />
true when building and planning a business.<br />
As with a building, the design, layout and<br />
construction of the footings is vital and the<br />
same is true for <strong>Muntons</strong> new Enterprise<br />
Resource Planning (ERP) tool S4/Hana. Having<br />
decided which ERP solution would be the best<br />
fit for us, we entered the blueprinting phase<br />
of the project. Staff from all areas of the<br />
company were co-opted into the project,<br />
to ensure that the new system was designed<br />
correctly to provide the information needed<br />
in every area. This work was undertaken<br />
without qualm, as its importance to the<br />
business was clearly recognised. The team<br />
tackled this with enthusiasm and dedication.<br />
This phase has effectively nailed down the<br />
final design of the system ready for its<br />
construction.<br />
The next phase was to move the project<br />
nearer to realisation as each of the<br />
blueprinted documents were ‘signed-off.’<br />
Testing and tweaking and retesting are<br />
now taking place as the project moves<br />
nearer towards completion – scheduled<br />
for the middle of 2017.<br />
Once complete, and after training, we<br />
will begin to feel the benefits of the new<br />
S4/Hana ERP system. Improvements in real<br />
time planning, reporting and analytics based<br />
on live data will provide opportunities for<br />
significant business benefits.<br />
Image courtesy Sally Wilson<br />
Having selected the platform and constructed the intranet to reflect<br />
our corporate style, the process of populating the intranet started.<br />
Department pages were setup and the media library populated<br />
and tagged and a team were drafted in to fill the intranet with<br />
useful and easy-to-find information. But the name? This needed<br />
some work. A competition was organised designed to engage the<br />
staff themselves into using their creative skills to offer suggestions.<br />
The winner (Dave Mugglestone, Head of Quality, Food Safety and<br />
Environmental Systems) was indeed a bright spark who, after<br />
dropping the suggestion ‘Spark’ into the mix, picked up the prize<br />
of a brand spanking new Kindle-Paperwhite.<br />
Spark is used to share news stories around the company and inform<br />
staff of corporate activities and successes. Information vital to the<br />
staff, such as what’s on the menu today in THE canteen is easily<br />
accessible through Spark, as is access to our corporate vision,<br />
mission and values. More useful however is the ability to download<br />
up-to-date forms, presentations, templates and to be able to search<br />
for images from the extensive media library. The system is relatively<br />
intuitive, so everyone here can now feel the benefit.<br />
14 15<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
INTERNATIONAL NEWS<br />
INTERNATIONAL NEWS<br />
SUNNY FUTURE<br />
FOR NEW ASIAN<br />
JOINT VENTURE<br />
This was a pivotal year for <strong>Muntons</strong> for a number of reasons but<br />
none more so than the beginning of overseas manufacture, as<br />
our Joint Venture in Thailand reached the point where product<br />
was made on the new plant for the first time. The US$17.5M joint<br />
venture agreement was originally signed in 2014 and during the<br />
following months, in a project ably headed by Colin Whitehouse,<br />
General Manager JJ-<strong>Muntons</strong> (Thailand) Ltd., a hive of activity was<br />
triggered as construction work began. The building was designed and<br />
constructed and the plant itself sourced, built and installed. Delivering<br />
a new state-of-the-art facility that converts liquid extract into powder<br />
by means of a band drying process. This is a joint venture undertaken<br />
in conjunction with our South East Asian partner Jebsen and Jessen<br />
Ingredients, who have an extensive distribution network stretching<br />
across the region.<br />
A grand opening ceremony was planned and organised and in April<br />
<strong>2016</strong> the new facility in Chonburi Thailand was officially opened. In<br />
keeping with Thai tradition, it received the blessing of nine Buddhist<br />
monks as they performed the ‘Taboon Khun Wan Mai’ (the number<br />
nine is considered to be a lucky number in Thailand). As is customary,<br />
the assembled specially invited VIP’s and guests completed the ritual<br />
Malt extract is used in a wide variety of<br />
consumer products in Asia not just because<br />
of the much-favoured taste but because of the<br />
nutritional benefits it brings, often used to<br />
supplement the local diet. Cold malted milk<br />
drinks are particularly popular, consumed<br />
by younger members of the population as a<br />
refreshing drink to boost energy levels.<br />
by handing food and water to the monks. Trees were planted as part<br />
of the ordination ritual, designed to raise awareness about the value<br />
of nature and inspire people to take part in conservation efforts.<br />
The trees were blessed to signify their sacred status and form part<br />
of a larger effort to foster a conservation ethic.<br />
The grand opening ceremony was topped off with a tour of the<br />
new facility, a gala dinner, entertaining karaoke and finally a<br />
spectacular fireworks display on the beach. This venture into the<br />
manufacture of premium malted ingredients in Asia brings benefits<br />
to the local community and to our business in the UK and sits firmly<br />
with our vision to bring the great taste and benefits of malt to the<br />
people of the world.<br />
The first shipments of malt extract, made at the <strong>Muntons</strong> plant in<br />
Stowmarket, were sent to the new factory in Thailand so that final<br />
plant commissioning could be undertaken to enable the new plant<br />
to commence production in earnest. Once in full production it is<br />
anticipated that 3,000 tonnes of malt extract will be shipped every<br />
year from our plant in Stowmarket, increasing our demand for<br />
quality East Anglian malting barley by nearly 5,000 tonnes.<br />
STARS & STRIPES<br />
<strong>Muntons</strong> has been exporting products to the USA for many<br />
decades but it was only in the last five years that we took the<br />
plunge and formed a US company originally based on the west<br />
coast at Seattle, Washington. This year <strong>Muntons</strong> Inc., moved<br />
premises and location – eastwards.<br />
<strong>Muntons</strong> Malted Ingredients Inc. has relocated to the suburb village<br />
of Lombard on the outskirts of Chicago, Illinois. This mid-west<br />
location was selected as the natural area to best serve the North<br />
American and international food and beverage industry and simplifies<br />
communications across time zones.<br />
The USA offers excellent opportunities for growth for <strong>Muntons</strong><br />
malt and malted ingredients. Areas such as the craft brewing industry,<br />
which has undergone unprecedented growth over recent years, and<br />
the burgeoning craft distilling market crave the traditional products<br />
we can offer – products with heritage and history. US and Canadian<br />
homebrewers continue to demand quality products to satisfy their<br />
hobby-orientated needs. But it is the food and beverage industry<br />
where <strong>Muntons</strong> malted ingredients offer the greatest potential<br />
as a source of wholegrains and natural sweetness.<br />
Our new Food Sales Manager, Tim Greiner, has been appointed<br />
to boost penetration into the food industry and, with distribution<br />
centres now located in Denver, (Colorado), Westfield, (Massachusetts)<br />
and Barton, (Vermont), <strong>Muntons</strong> Malted Ingredients Inc. is well<br />
placed to offer an unparalleled excellence of service to our customers.<br />
BREXIT IMPACT<br />
The result of the referendum may not have been in line with<br />
either the expectations or desire of some UK businesses but<br />
the people have spoken and the world will now have to live<br />
with that decision. <strong>Muntons</strong> are confident that we are agile<br />
enough to get the very best out of the changing landscape.<br />
Supplying product already to 76 countries globally provides a clear<br />
indication that whilst trade with Europe is important it is not the only<br />
region where trade opportunities exist. As the dust settles and exit<br />
negotiations progress, the way forward will become clearer. The main<br />
area of concern is whether the Government will take the necessary<br />
steps to ensure that UK food manufacturers such as <strong>Muntons</strong> are<br />
not disadvantaged through the results of their endeavours. Having<br />
a level playing field across Europe will help to ensure that UK<br />
maltsters remain competitive with their European counterparts.<br />
We are sure that the situation will become clearer over the next<br />
few years as trade agreements and farm strategies are settled.<br />
<strong>Muntons</strong> has already begun the process of developing trade<br />
opportunities in areas previously unexplored and we have already<br />
seen successes as we break into new markets. It is true to say that<br />
we live in interesting times.<br />
16 17<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
Our most decadent<br />
dessert<br />
If you are seeking the ultimate dessert to round off<br />
your dinner party, a real statement piece, then look<br />
no further. <strong>Muntons</strong> has developed this delicious<br />
dessert to showcase the versatility of malt. Our<br />
recipe, one of many available on our website, calls<br />
for the inclusion of Lindt chocolate and Maltesers,<br />
both of which are made using malt, which imparts a<br />
rich smoothness and mouth-warming malt flavour,<br />
making this an outstanding malted quartet.<br />
Malt has a place in an amazing variety of<br />
confectionery, cakes and cookies; from the obvious,<br />
malted milk biscuits, to perhaps the less obvious -<br />
products such as chocolate muffins. Malt is not just<br />
used to add maltiness, it can be added for flavour<br />
or colour enhancement, to add texture, increase<br />
humectancy or to simply add a lovely shine.<br />
Malt is a natural ingredient and, in its extracted<br />
form, is low in fat, a good source of fibre, protein,<br />
vitamins and complex carbohydrates and, because<br />
it falls in the ‘low’ category in the glycaemic index,<br />
it offers a slow release of energy rather than<br />
introducing a sugar ‘high’.<br />
Made using crushed malted milk biscuits<br />
as the base, malt extract in the cheesecake<br />
filling and topped off with melted Lindt<br />
chocolate and crushed Maltesers, our<br />
Quadruple malted cheesecake is the ultimate<br />
in decadent luxury. A perfect melt-in-themouth<br />
malty masterpiece.<br />
18 19<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
COOKING UP A STORM – MEET<br />
OUR NEW CATERING APPRENTICES<br />
Every year <strong>Muntons</strong> runs approved<br />
apprenticeship programmes designed<br />
to offer real world training for the<br />
apprentices. This is an excellent way<br />
for hands-on students to get a<br />
qualification, get experience, get<br />
paid and at the end of their term<br />
stand a good chance of getting a full<br />
time job at <strong>Muntons</strong> as well.<br />
Apprenticeships have always been a great<br />
way of learning jobs such as engineering,<br />
where getting your hands dirty and fixing<br />
problems are everyday experiences. But<br />
there are also apprenticeship opportunities<br />
in other areas too.<br />
In <strong>2016</strong> we created two new apprenticeship<br />
positions, in conjunction with our catering<br />
partner, Churchill Catering, providing an<br />
opportunity to learn more about catering<br />
and creative food preparation and<br />
manufacture. Hannah Fayers and Charlie<br />
Duffy, our two apprentices, rotate their<br />
time between the busy canteen and<br />
<strong>Muntons</strong> state-of-the-art Centre for<br />
Excellence, spending seven weeks in each,<br />
four days a week, where they learn about<br />
the manufacture of malt and malted<br />
ingredients and how to incorporate these<br />
into wonderful food dishes. Add to this<br />
one day a week at college and at the<br />
end of their 18 months they will pick<br />
up a level 2 qualification and earn a<br />
decent wage for their efforts.<br />
Apprenticeships are not just good for the<br />
student, they offer <strong>Muntons</strong> the chance<br />
to really get to know the strengths of the<br />
individual and allow them to develop<br />
skills that will bring benefits to the<br />
company as well.<br />
Both Hannah and Charlie were delighted<br />
to have been selected for these new roles,<br />
seeing this as a real challenge and an<br />
excellent opportunity to develop new<br />
skills and gain two useful qualifications.<br />
We were equally pleased to have found<br />
two such enthusiastic and cheerful people<br />
for our new hospitality and professional<br />
cookery positions.<br />
FOCUS ON EDUCATION<br />
HEADING FOR TOP SPOT<br />
Melissa Abbott has been appointed<br />
National Vice Chairman of the Brewing,<br />
Food & Beverage Industry supplier’s<br />
association (BFBi), the first time this<br />
role has been held by a woman. This<br />
is a two-year appointment and after<br />
this period usually leads to the position<br />
of Chairman. Not only is this a success<br />
for ‘girl power’ but Melissa is also one<br />
of the youngest people ever to have<br />
held this post.<br />
The BFBi is an historic association, founded<br />
in 1907 and known then as the Allied<br />
Brewery Traders Association. It has a rich<br />
history of achievements for its members<br />
representing the food, brewing and<br />
beverage industry at Governmental level.<br />
They bring together representatives from<br />
across the industry offering an opportunity<br />
for face to face discussions. They also<br />
organise trade days and social events such<br />
as cricket matches, charity cycle runs and<br />
quizzes - informative and fun events<br />
presenting ideal opportunities for<br />
networking within the industry. Having<br />
such a young, enthusiastic vice chairman<br />
should bring some youthful energy and drive<br />
to the association to ensure that it continues<br />
to bring benefits to its members and the<br />
community at large.<br />
In addition to the BFBi appointment,<br />
Melissa has also recently been made a<br />
Trustee of the Essex and Suffolk Rivers Trust.<br />
This appointment sits comfortably with her<br />
work at <strong>Muntons</strong>, where she is involved in<br />
environmental and sustainability initiatives<br />
throughout the supply chain. Last year she<br />
helped to create a series of wildlife walks<br />
within <strong>Muntons</strong> 45 acre Stowmarket site<br />
through which runs the River Gipping –<br />
walks much enjoyed by <strong>Muntons</strong> staff<br />
during their breaks.<br />
IT’S OFFICIAL:<br />
Alan is a<br />
jolly good<br />
fellow!<br />
Last year it was reported that the University<br />
Campus Suffolk had awarded an Honorary<br />
Fellowship to the Managing Director of <strong>Muntons</strong>.<br />
This year another Fellowship is bestowed.<br />
Having already awarded Alan Ridealgh an Honorary<br />
Fellowship of the University Campus Suffolk, one of<br />
the highest awards that the University can bestow,<br />
they have now decided to make Alan another Fellow<br />
of the University. On this occasion, they have made<br />
Alan a Visiting Senior Fellow in Food Manufacturing<br />
and Sustainability in the Department of Science and<br />
Technology. A position which will run for a minimum<br />
of three years.<br />
This Honorary Fellowship will see Alan working more<br />
closely with the local University, as he helps to<br />
explain ways in which the role between sustainability<br />
and food manufacture can be developed and<br />
improved. Enhancing ties between business and<br />
educational institutions is a fundamental part of<br />
<strong>Muntons</strong> drive towards the integration of Corporate<br />
Social Responsibility (CSR), within our organisation.<br />
It is hoped that this close co-operation will see the<br />
creation of joint projects and perhaps even the<br />
sharing of equipment and technology.<br />
<strong>Muntons</strong> sent complete homebrew starter systems<br />
to the University as examples of ‘Science in a box’<br />
for the Senior Lecturer in Bioscience, Dr Christopher<br />
Turner, to share with his students. This offers a<br />
practical demonstration of the effect of yeast on<br />
fermentable sugars. As a by-product, it also shows<br />
how to brew a very acceptable beer too.<br />
FROM STOWMARKET<br />
TO SWAZILAND WITH A<br />
LITTLE HELP FROM US<br />
Seventeen students from Stowupland High School embarked on a world challenge<br />
event which would see them flying out to South Africa then across to Swaziland to<br />
help in a children’s orphanage for two weeks. Each of the students needed to raise<br />
money themselves to pay for the trip – nearly £3,000 each.<br />
Student Imogen Flack had already made good progress in raising funds but came up with<br />
the bright idea of contacting some local companies to see if they would assist. So, when Alan<br />
Ridealgh, Managing Director, heard of the challenge he immediately offered to help. The<br />
details of the trip were quite eye opening, as Imogen and her teacher Amy Keeble explained<br />
the challenges the students will face and the good work they will be undertaking; work likely<br />
to be life changing experiences for the students. Alan was quick to applaud Stowupland High<br />
School for undertaking this initiative.<br />
Alan Ridealgh and Dawn Knights handed a cheque for £270 to Imogen to help with her fund<br />
raising, whilst also providing a supply of useful items to help with the trip, including a fleece,<br />
polo shirt and beany hat to keep her warm during the cold nights in her tent.<br />
The other students were not forgotten however and we also provided sufficient polo shirts<br />
for all the students and the teaching staff undertaking this challenge. The shirts will be passed<br />
over to the orphanage, rather than bringing them home as good quality clothing is in short<br />
supply in Swaziland.<br />
Dawn Knights, our charity coordinator commented: “The climate in Swaziland can be quite<br />
extreme, with hot dry days and freezing nights, this coupled with the ‘trowel-based’ sanitary<br />
facilities and canvas sleeping arrangements will in themselves prove challenging enough<br />
for the students, this before they even start helping with the children themselves. They are<br />
very brave.”<br />
Although we export our products to 76 countries and have first-hand experience of conditions<br />
in overseas markets, to date Swaziland is not one that we currently supply - yet.<br />
20 21<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
CUTTING EDGE LABORATORY<br />
UPGRADE GETS RESULTS FAST<br />
the undiscovered<br />
ingredient<br />
Measurements are important in business, helping us to make comparisons and meaningful<br />
choices. They are very important when it comes to the selection of raw materials and ensuring<br />
that the products we make meet the expectations of our customers. Having the facility in place<br />
therefore to be able to make accurate and repeatable measurements is vital – and this is where<br />
the laboratory at <strong>Muntons</strong> comes into play.<br />
Making accurate and repeatable measurements is crucial to ensure that<br />
we are both buying and selling products to the correct specifications<br />
but equally important is having the information available in a timely<br />
fashion. Almost all of our products are positively released. They cannot<br />
be sent to a customer unless they have been checked and cleared<br />
through our laboratory and meet the specification for the product. To<br />
achieve this, it is important that the laboratory have an experienced<br />
trained team who understand how to undertake the measurements<br />
and meet the deadlines laid down to ensure timely despatch.<br />
Times change and developments in new technology offer better and<br />
faster ways to make these measurements. During this financial year,<br />
significant investments have been made which have given us the<br />
necessary tools to ensure that we are at the forefront of our industry.<br />
Take a seemingly simple task such as measuring the nitrogen and<br />
protein content of barley. There was a time when measuring nitrogen<br />
in barley would take an hour, now with a calibrated ‘LECO’ instrument<br />
we can do this in five minutes. Even quicker at just one minute with<br />
our near infra-red (NIR) analysis device, which provides an accurate<br />
indication of the quality of barley, helping to improving the speed of<br />
turn-around of barley deliveries. We are now starting to expand this<br />
technology into other parts of the business with the purchase of the<br />
latest generation NIR analyser, which can deliver the fast turn-around<br />
analysis needed for our malted ingredients samples.<br />
Another investment was the purchase and installation of a new dust<br />
extraction safety cabinet for our Miag mill, used every day for grinding<br />
all malts for hot water extraction. Not only does this provide a safe<br />
working environment for our staff, but also ensures a solid structure for<br />
delicate analytical equipment. Not all of the work undertaken within<br />
the lab is for <strong>Muntons</strong>, we also offer, and undertake, analysis work for<br />
external institutions, and, as part of a crop trials system, we micro-malt<br />
and analyse samples of barley to assesses the suitability of new barley<br />
varieties for brewing and distilling.<br />
Our anaerobic digestion (AD) plant also demands a level of laboratory<br />
control to ensure it is running at its optimum capability and we have a<br />
dedicated team in place to ensure this happens. Our plant has now had<br />
a full year of continuous activity and during this time it generated<br />
2.44GWh, enough to provide 14% of our entire Stowmarket site<br />
electricity, or to put it another way, enough electricity to provide power<br />
for over 500 average UK houses.<br />
There are however other outputs from our AD plant which are proving<br />
to be of interest. After our malted ingredients residue has been<br />
through the AD process it is pasteurised and centrifuged into a suitable<br />
condition to sell as a biofertiliser. Research has been conducted with<br />
Lincoln University to determine the efficacy of this compared to<br />
artificial fertilisers and this has shown that in greenhouse trials, our<br />
biofertiliser improves lettuce growth more than the simple nutrient<br />
content offered by artificial fertiliser. Research into this crop enhancing<br />
property will continue. Meanwhile, samples of our digestate from<br />
within the AD reactor were sent to University College London and it<br />
was analysed as part of their ‘Swab and Send’ project, aimed at finding<br />
new antibiotics. We were pleased to discover that our AD plant<br />
appears to produce antibiotics that could potentially be developed as a<br />
medicine to combat Micrococcus and multi drug resistant E. coli.<br />
Further research is being undertaken to identify the strain of bacteria<br />
found and the compound that it is producing it, to determine if it is<br />
something novel. Medicine from waste, whatever next?<br />
We love malt, and judging by the number and variety of foods and<br />
beverages made using our raw materials, so it appears do consumers<br />
all over the world. Most people probably eat or drink something made<br />
using malt every day, yet how often is it used in home cooking?<br />
One of our challenges is to bring the benefits of malt to the<br />
masses and encourage the consumer to see malt<br />
extract as a store cupboard ingredient.<br />
As our customers discover the benefits<br />
that malt can bring to their products, the<br />
diversity and variety of applications using<br />
malted ingredients grows every year. As<br />
food and drinks manufacturers strive for<br />
cleaner labelling, malt as a natural<br />
product is favoured over more highly<br />
processed ingredients. Consumers want<br />
natural ingredients, a trend which is<br />
making our ingredients more popular<br />
than ever. But the world is a competitive<br />
place, so our efforts are clearly focused on<br />
growing interest in our company and our<br />
products around the world.<br />
Our joint venture in Asia is a bold step,<br />
as historically all our manufacturing has<br />
been undertaken as near to our main raw<br />
material as possible - in the main malted<br />
barley growing regions of the UK. This<br />
new joint venture marks a step change,<br />
as we begin manufacturing nearer to the<br />
market itself. Malt extract made in our<br />
plant in Stowmarket is shipped to<br />
Thailand to be blended with local<br />
ingredients. This blend is then dried into<br />
a stable powder on our new vacuum band<br />
dryer. Not only are we introducing the<br />
benefits of UK malt but we are making<br />
a final product tailored to meet the exact<br />
tastes of the local market. Investment<br />
today to bring prosperity tomorrow.<br />
In the USA, we moved the offices of<br />
our American company, <strong>Muntons</strong> Malted<br />
Ingredients Inc., eastwards, from Seattle<br />
to the suburb village of Lombard, on the<br />
outskirts of Chicago. Positioned in the<br />
best location to maximise the business<br />
potential from North American customers.<br />
We have also expanded our US<br />
warehousing facility to include a new<br />
outlet in Denver Colorado, making it<br />
easier than ever for our US customers<br />
to buy our products. Looking further<br />
southwards, we are also increasing our<br />
reach, growing sales into markets across<br />
South America. Our network of agents<br />
and distributors are also important<br />
contributors to our global success and<br />
to ensure they are up to date with our<br />
products and processes we held two<br />
conferences during the year. The first<br />
in Düsseldorf for our European partners<br />
followed by a similar event in Bangkok<br />
for our agents and distributors from the<br />
Asian Pacific region. In June, our sales<br />
managers for the US, Asia and Europe<br />
joined with our UK team to share their<br />
challenges and successes and jointly learn<br />
about new applications for malted<br />
ingredients and explore market<br />
developments and trends.<br />
As we continue to see increases in sales<br />
of our extracts, this brings a fresh set of<br />
challenges for our production, planning<br />
and customer services teams. It is at times<br />
like this when our values are brought to<br />
the fore and our trusted, creative and<br />
agile teams work together to ensure<br />
that our future is truly sustainable.<br />
22 23<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
malt –<br />
naturally!<br />
This financial year we completed a major<br />
investment project, updating our<br />
Stowmarket grain handling facility.<br />
£2.6 million was spent, not just in new<br />
grain drying facilities, but in the<br />
construction of enhanced barley storage<br />
and refurbishment of the existing grain<br />
silos. This major investment will pay<br />
dividends in the coming years through<br />
a reduction in our energy costs and the<br />
faster throughput this will bring. It is this<br />
type of forward looking investment that<br />
places us on a firm footing for the future.<br />
Production output at both our<br />
Stowmarket and Bridlington maltings<br />
peaked at record annual volume levels,<br />
producing a combined group malt output<br />
for the year of over 194,000 tonnes.<br />
This was achieved through innovation,<br />
a review of our malting processes and<br />
good teamwork. This additional malt<br />
production output was matched with<br />
increased sales to both the global brewing<br />
and distilling industries. A high level of<br />
Malting brings a range of nutritional benefits compared with<br />
basic cereal grains such as enhanced levels of folate (vitamin B9),<br />
considered by some to be one of the vitamins lacking in the Western<br />
diet, and silicon, essential for proper development of collagen and<br />
bones. Malt is used in a multitude of products but the main<br />
large scale user of malted grains is the brewing and distilling<br />
industry, accounting for 95% of global production.<br />
customer care was required and our<br />
customers’ expectations were diligently<br />
managed by our dedicated customer<br />
services team lead by Hannah Cappleman.<br />
We completed the year achieving a<br />
creditable 98.5% of our sales budget,<br />
a figure which would have been higher,<br />
had a few unforeseen events not occurred<br />
preventing our customers from taking<br />
deliveries.<br />
Our sales into the UK craft brewing<br />
market have increased by 30% over the<br />
last two years. This is a reflection of the<br />
increasing number of breweries, and beer<br />
drinkers enjoying craft beers, but also our<br />
increased sales activity through our<br />
expanded sales team in the UK. In the<br />
USA, we have seen increased demand<br />
from the fledgling craft distilling sector<br />
which, coupled with continued growth<br />
in market share from the craft brewing<br />
sector, provided further sales<br />
opportunities. To capitalise upon this,<br />
we attended a number of brewing and<br />
distilling exhibitions in the USA, adding<br />
our support to the resident <strong>Muntons</strong><br />
Malted Ingredients Inc. sales team. Other<br />
global trade events were attended by our<br />
sales team including brewing exhibitions<br />
and conferences in the UK, Germany,<br />
Spain, Australia and Vietnam to support<br />
increasing sales opportunities and<br />
partnerships.<br />
The short-term Brexit effect was to<br />
immediately weaken the value of Sterling<br />
against the Euro and USD which has aided<br />
our export drive leading to increases in<br />
overseas volumes, particularly into South<br />
East Asia. Whilst there will be some<br />
uncertainty as we manoeuvre ourselves<br />
out of the EU, we are confident that we<br />
will continue to remain competitive in the<br />
global arena. In the latter part of the year<br />
we lodged plans to construct a new<br />
dedicated malt peating plant in the<br />
North of England close to our Bridlington<br />
maltings, to support our future sales<br />
growth to the global distilling markets.<br />
SPLASH IT ON<br />
Malt vinegar will pucker up your taste buds<br />
but may bring other benefits too. Latest research<br />
suggests that malt vinegar might offer nutritional<br />
benefits. The acid in malt vinegar may help<br />
with weight management, help control blood<br />
sugar levels and promote a healthy heart.<br />
Stand in the high street with a clipboard and ask people what malt is.<br />
Chances are that they might mention malt whisky, malt vinegar or that<br />
it is used in beer. If you are very lucky they could introduce hot malted<br />
milk drinks, malted milk biscuits or malt loaf. One respondent assured<br />
us that it was something their cat did in the summer! What was<br />
interesting, was that malt vinegar featured high on the list.<br />
It is believed that vinegar was first discovered over 7000 years ago but<br />
it was Louis Pasteur in 1865 who unlocked the secret of acetification<br />
through his scientific work. Malt vinegar is made by using a two stage<br />
fermentation process, the first to create alcohol, the second to convert<br />
alcohol to acetic acid. Today it has become a store cupboard ingredient<br />
used in a vast array of food dishes because of its tangy taste. Pickled<br />
onions, pickled gherkins and pickled cabbage just would not taste as<br />
good if they were pickled in anything other than Malt vinegar. Malt<br />
vinegar is big business – a business that we are proud to supply.<br />
24 25<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
<strong>Muntons</strong> Made<br />
OUR YEAR IN NUMBERS<br />
SALES TURNOVER (£M)<br />
105<br />
100<br />
95<br />
90<br />
85<br />
80<br />
75<br />
70<br />
7<br />
6<br />
5<br />
4<br />
3<br />
2<br />
1<br />
0<br />
-5<br />
0<br />
2012 2013 2014 * 2015 <strong>2016</strong> 2012 2013 2014 * 2015 <strong>2016</strong><br />
2012 2013 2014 * 2015 <strong>2016</strong><br />
Malt & MI<br />
Other<br />
Sales tonnage has increased by 5% from<br />
2015, but turnover has decreased in line<br />
with the drop in raw material prices and<br />
change in product mix.<br />
CAPITAL EXPENDITURE (£M)<br />
12<br />
10<br />
8<br />
6<br />
4<br />
2<br />
0<br />
-2<br />
2012 2013 2014 * 2015 <strong>2016</strong> 2012 2013 2014 * 2015 <strong>2016</strong><br />
Expenditure on capital items was £5.7m,<br />
reflecting the ongoing level of strategic<br />
investment which included the new barley<br />
intake and the SAP project.<br />
RETURN ON CAPITAL EMPLOYED –<br />
EXCLUDES EXCEPTIONAL ITEMS %<br />
25<br />
20<br />
15<br />
10<br />
5<br />
0<br />
Return on Capital Employed has decreased<br />
from 2015 due to the increased investments<br />
being undertaken for the future. Increased<br />
earnings due to these investments will be<br />
recognised in future periods<br />
EARNINGS BEFORE INTEREST, TAX,<br />
DEPRECIATION AND AMORTISATION<br />
(£M) (EBITDA)<br />
Depreciation<br />
Interest<br />
Profit / Loss Before Tax<br />
Finance Charge on FRS 17 Deficit<br />
EBITDA decreased marginally from 2015,<br />
reflecting the expenditure undertaken in<br />
order to get the Joint Venture to the point<br />
of manufacture. Also there has been a higher<br />
proportion of sales to export markets at<br />
slightly lower margins.<br />
BORROWINGS (£M)<br />
30<br />
25<br />
20<br />
15<br />
10<br />
5<br />
Long Term<br />
Short Term<br />
Net borrowings have decreased due to cash<br />
generated from operations and a slight<br />
reduction in stock holding. A significant<br />
level of investment is being maintained<br />
year on year.<br />
* The 2014 figures are pro rata from a<br />
66 week period to a comparative 52 week.<br />
SUMMARY GROUP INCOME STATEMENT<br />
Restated<br />
<strong>2016</strong> ** 2015 **<br />
£’ 000 £’ 000<br />
52 weeks 52 weeks<br />
Turnover 90,330 91,493<br />
Cost of Sales (65,595) (66,245)<br />
Gross Profit 24,735 25,248<br />
Administration and Distribution Costs (16,020) (16,292)<br />
Profit before interest 8,715 8,956<br />
Share of loss in joint venture (677) (261)<br />
Interest Payable (959) (1,035)<br />
Other Finance Charge 454 185<br />
Profit before tax 7,533 7,845<br />
Tax on Profit (1,649) (1,824)<br />
Profit after tax 5,884 6,021<br />
Earnings per Share 691.0 707.0<br />
SUMMARY GROUP STATEMENT OF FINANCIAL POSITION<br />
Fixed Assets 30,579 28,467<br />
Current Assets 45,483 45,871<br />
Current Liabilities 27,606 26,200<br />
Net Current Assets 17,877 19,671<br />
Total Assets less Current Liabilities 48,456 48,138<br />
Long term Creditors (10,915) (12,930)<br />
Deferred Tax (270) (300)<br />
Net Assets before Pension Liability 37,271 34,908<br />
Pension Liability (10,109) (8,958)<br />
Net Assets 27,162 25,950<br />
Share Capital 852 852<br />
Reserves 26,310 25,098<br />
Total Shareholders’ Funds 27,162 25,950<br />
SUMMARY GROUP STATEMENT OF CASH FLOWS<br />
Net Cash from Operating Activities 9,444 4,406<br />
Net Cash from Investing Activities (6,249) (4,096)<br />
Net Cash used in Financing Activities (3,537) 49<br />
Net (Decrease)/Increase in Cash and Cash Equivalents<br />
(342) 359<br />
Cash and Cash Equivalents at the beginning of the year<br />
(10,012) (10,371)<br />
Cash and Cash Equivalents at the end of the year (10,354) (10,012)<br />
** This financial information has been provided prior to the completion of our statutory accounts.<br />
26 27<br />
Discover more at: www.muntons.com<br />
<strong>Muntons</strong> PLC <strong>Annual</strong> <strong>Review</strong> <strong>2016</strong>
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