The American owner of Moy Park, one of the North's biggest employers, has warned that its operations "may be adversely affected" if the UK is unable to secure post-Brexit replacement trade arrangements "on terms as favourable as those currently enjoyed".
Pilgrim’s Pride Corporation, which acquired Moy Park in September 2017 in a £1 billion deal, issued the stark warning in its latest annual report filed with the United States Securities and Exchange Commission.
The corporation, which is one of the largest chicken producers in the world, identified Brexit as one of the key risks to its organisation because of its potential to “adversely impact our business, results of operations and financial condition.”
Last week Pilgrim’s Pride Corporation reported net sales of $10.77 billion and adjusted EBITDA of $1.39 billion for 2017.
The organisation, which was first established in Texas in 1968, said the acquisition of Moy Park had been a key highlight last year and had positioned it as “the global leader in chicken and chicken-based prepared foods.
Moy Park is Northern Ireland’s largest private sector business and one of Europe’s largest poultry producers – it processes an estimated six million birds a week- and operates four fresh processing plants, 10 prepared foods cook plants, three feed mills, seven hatcheries and one rendering facility across its operations in the UK, France, and the Netherlands.
According to Pilgrim’s Pride 2017 annual report its Moy Park operations generated 18.2 per cent of the corporation’s total net sales last year but the American group clearly outlines in its latest end of year report its concerns about the potential impact that the UK vote to leave the EU could have on its operations.
“Brexit could impair our ability to transact business in the UK and in countries in the EU. Brexit has already and could continue to adversely affect European and/or worldwide economic and market conditions and could continue to contribute to instability in the global financial markets,” it stated.
The American group also said: “If the U.K. were to significantly alter its regulations affecting the food industry, we could face significant new costs. It may also be time-consuming and expensive for us to alter our internal operations in order to comply with new regulations. Additionally, Moy Park’s results of operations may be adversely affected if the U.K. is unable to secure replacement trade agreements and arrangements on terms as favourable as those currently enjoyed by the U.K.”
It surmises that “any of the effects of Brexit” could adversely affect its business, business opportunities, financial condition and cash flows.