McBride beats earnings estimates as consumers turn to private label products
This trading environment has continued from the latter part of FY23 into the first quarter of FY24. and has led to a 10.8% growth in private label products and an overall 8.0% increase in Q1 volumes compared to the same period in FY23.
Even more encouragingly, its business performance in the first three months of this financial year has exceeded forecasts by approximately £8 million at the EBITA level.
McBride also drew attention to the fact that it continues to face challenges from inflation, with stable raw material and packaging costs but rising labour, energy, and indirect expenses. The company further noted that global instability could further raise commodity prices.
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Today’s update is evidence that McBride is successfully managing to navigate a series of macroeconomic challenges, along with a tight hold on costs and working capital.
McBride makes laundry, household cleaning and personal care products which are sold by supermarkets under their own name. The rapid growth of private label products is being driven by companies like McBride producing the best quality for price point paid. This rings particularly true as the cost-of-living crisis persists, with recent research from the Data & Marketing Association concluding that 48% of consumers say they are ready to ‘abandon’ their favourite brand if prices rise further.
As the 2024 financial year continues, McBride’s leadership positions across many of its markets and categories mean it is well placed to deliver sustainable, profitable growth over the longer term.
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