An improvement in the performance of purchased business Verde Horticulture has led to Butters Group reducing its pre-tax loss.
The business, which supplies horticultural products and floral arrangements to supermarkets and DIY stores, posted a pre-tax loss of £1.4 million for the year ending 30 September 2014 - down from the £3.8m pre-tax loss recorded in the 15 months to 30 September 2013.
The group's turnover during the most recent financial year was £59.4m.
Verde, formerly Landgard UK, was purchased by Butters Group in May 2013, creating the UK's largest plant supplier in the process. The Verde business in its own right posted a pre-tax profit of £8,533 in the financial year ending 30 September 2014, recovering from a pre-tax loss of £1.1m in the six-month period ending 30 September 2013.
Speaking in the report accompanying the accounts, Butters Group MD Andy Coaten, said: 'The trading performance of the group during the year improved significantly, and EBITDA increased by £1.5m despite the lower turnover. Group turnover reported is lower as a result of the extended prior period reporting.
'In 2013 the group reported the acquisition of Verde Horticulture as part of a group strategy to develop new markets and customers. From acquisition, the group began the process of turning around the previously loss-making business by concentrating turnover, reducing the sites and resources it operates, and establishing tighter group controls and reporting. The result of these initiatives contributed to the improved group profitability, and wider strategy.'
Coates noted that turnover from other group companies, such as Keith Butters and Butters Flowers, was largely consistent with previous years on an annual like-for-like basis. The latter business has been aided by a 'strengthened relationship' with a major retailer, while the former has been working closely with Verde to 'maximise opportunities in the plants and bulbs sector of the group.'
Looking forward, Coaten said: 'It is expected, following the continued investment into capital projects and initiatives to drive efficiencies, that group profits and cash generation will further improve in 2014-15. Other strategic developments are also being evaluated to enhance longer-term profitability and shareholder value.
'The group aims to strengthen its position with current and new 'blue chip' customers by delivering innovative plant, flower and bulb ranges, building on its reputation for quality and service. The group will also continue to work tirelessly with long-standing worldwide suppliers to improve raw material sourcing and development.
'Revenue and profitability improvements will be generated from returns on investment made to increase revenues, capacity and production for growing own product for resale. The need to be lean and efficient will enable the group to compete in difficult market conditions, where price, service and quality are paramount.'
