UK company considers moving some production to US to reduce tariff impact
The company said it has ‘a number of options open to it to mitigate impact’ of Donald Trump’s tariffs
Applied Nutrition is considering shifting the production of some of its products to the US to avoid future tariff costs, even as it reports increased sales driven by strong UK demand.
Bosses at the Liverpool-based sports nutrition and health company say they see further international growth potential, particularly in markets like Canada, which have been significantly impacted by tariffs.
This news comes despite a dip in profits for the first half of the year, which sent share prices tumbling.
The company, which floated on the London Stock Exchange last year with a £350 million valuation, saw a 4.8 per cent rise in revenue, reaching £47.6 million in the six months to January.
It said this is ahead of its forecasts at the time of its stock market listing, with the business on track to meet its full-year revenue guidance of £100 million.
The Coleen Rooney-backed firm said trading in more recent weeks has remained “strong”, with record revenues in March.
As a result, the company held firm on its profit and cash flow forecasts for the year.
Applied Nutrition stressed on Monday that it “does not expect to be materially impacted” by changes to US tariffs, after President Donald Trump confirmed a blanket 10 per cent tariff for goods imported to the US from countries including the UK.
Nevertheless, the business said it has “a number of options open to it to mitigate impact, such as moving production of liquid products currently produced in the UK to being manufactured in the US”.
Group chief finance officer Joe Pollard said the business currently has “limited exposure” to the US but highlighted that there could be some positives from the tariff rules.
“The US is less than 10 per cent of our revenues, but I also think, in some other regions, it means there is an opportunity there,” he said.
“It gives us a lot of opportunity in countries like Canada where they are looking to source from companies in the UK where they may have previously used a US supplier.”
Meanwhile, the company said its profitability is set to be boosted by efforts to drive efficiencies, including a recent factory extension.
It added that it does not expect a material impact from a recent jump in whey protein prices as it manages its cost base.
It came as the firm reported that pre-tax profits slipped by 26.7 per cent to £11.8 million for the past six months.
Shares in the business were down 3.6 per cent on Monday.