Tea factory trespassers caused millions of pounds of damage

Tea giant Typhoo claims trespassers at its closed Wirral factory caused “extensive damage” worth millions of pounds and slowed down the sale of the site. Typhoo announced in March last year that it was closing the Moreton plant with the loss of up to 90 jobs.

The company has now confirmed it incurred one-off costs of more than £20m after its Moreton factory was broken into and occupied for several days during August 2023. That meant Typhoo Tea reported a pre-tax loss of £37.9m for the year to September 30, 2023, compared to a loss of £9.6m in the prior 12 months, City AM is reporting.

Newly-filed accounts at Companies House also show the firm’s revenue fell from £33.6m to £25.3m over the same period. A statement from the board said: “Whilst trading was broadly in line with expectations given the effects of the transformation of the business during the period, 2023’s results are dominated by exceptional costs of £24m.

“A portion was the one-off costs of executing a major transformation plan, necessary to address the significant legacy and structural issues faced by the company but fundamental to providing a pathway to sustained profitability. Significant progress was made in the plan’s delivery during the year.

“However, a significant portion also came from one-off events, outside of the company’s control, which could not have been foreseen but negatively impeded progress and had additional material adverse effects on the company’s results.”

Typhoo Tea’s transformation plan included the closure of the Moreton site, as well as the discontinuation of unprofitable product lines. It said the plant was “inefficient and unsuitable to the revised rationalised product portfolio and beyond economic refurbishment”.

It said that in August last year, a group of “organised trespassers” broke into the Moreton premises and occupied it for several days. Typhoo said they caused “extensive damage to its fabric and contents, making the site inaccessible”.

It added the “abrupt closure” of the site meant the relocation of production to third party producers had to happen “faster than anticipated”. That mean, it said, “significantly higher direct expenses, impairment of assets and inefficiencies on production as our co-packing partners ramped up their production”.

That meant Typhoo Tea’s total exceptional costs rose from just £452,000 in 2022 to £24m in 2023. After the end of its financial year Typhoo Tea recovered £4.3m in an insurance claim.

The company also confirmed the land and buildings at Pasture Road, Moreton, had now been sold for £4.6m. It said the damage to the site had delayed the sale, but that it had completed in June.

Typhoo Tea was acquired by Zetland Capital Partners in July 2021. Following its move from Moreton, the company’s registered office has now been moved from Wirral to Bristol.

In its latest accounts, Typhoo said that, having “radically rationalised operations” in 2023, its directors were “excited” for 2024. It said: “Legacy issues have been largely dealt with and the results of this operational transformation should become evident during this period.

“The company is now set up for growth, will add value to our customers and consumers and expects to further increase and improve its product range. The company will also garner incremental distribution in new channels and improve penetration and operations to achieve higher efficiency and profitability.”