OAKLANDS FARM EGGS has posted a pre-tax loss of £1.7m in its latest financial results, which cover the year to 31 March 2020.
Turnover at the firm was 1% lower, at £62.8m.
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The company said a challenging free-range egg market was hitting profitability as it made significant investments in converting to cage-free production.
“The current saturated market and other wider economic conditions which influence demand are driving down the prices of free-range eggs,” the directors’ report said.
Oaklands added that it would only enter into long-term supply arrangements with free-range customers and that it was prepared to withdraw from markets it did not consider sustainable.
It also said that it had supported free-range producers at its own cost when sales prices had been below the cost of production.
The directors said that ‘phase one’ of a planned conversion to cage-free had been completed.
The company is also working with welfare academic Christine Nicol and the Royal Veterinary College University London to establish ‘best industry practice’.
The next phase of conversion will take the firm to more than one million cage-free birds which “will place the company well ahead of any retailer expectation”.
“Historically, the company has led in colony conversion and the directors are confident the company will be well placed and in a good position to do this again.
“Whilst the directors recognise the challenges to short-term profit in respect of this, it places the company ahead of the market for the future long-term strategy over the next ten to 15 years.”