Typhoo Tea, the historic Bristol-based tea company with over a century’s heritage, faces a critical moment as more than 100 jobs hang in the balance with the firm teetering on the edge of administration.
The company, looking to manage its precarious financial state, has proposed EY to supervise an impending administration process after lodging a notice of intention to appoint administrators, as reported by City AM.
Typhoo’s CEO, Dave McNulty, told the BBC that this step “affords the company some breathing space to explore solutions”.
This development follows a tumultuous year for Typhoo Tea, which reported a loss close to £40m for the year ending 30 September 2023. This heavy financial hit came after its Merseyside factory suffered “extensive damage” due to trespassers.
After a break-in at its Moreton factory, which then was occupied for a number of days in August 2023, Typhoo faced one-off costs upward of £20m. Consequently, the tea giant recorded a pre-tax loss of £37.9m for the year, a significant drop from the previous year’s loss of £9.6m, while its revenue also decreased from £33.6m to £25.3m during the same timeframe.
With no profit seen since 2017 and a history of over £100m in pre-tax losses since then, the last reported pre-tax profit for Typhoo was merely £220,000 for the year ending 31 March 2017.
Although the accounts for its most recent financial year aren’t expected at Companies House until June 2025, the company had already experienced hardship, announcing the closure of its Moreton site in March 2023, which resulted in up to 90 job losses scheduled for June that year.
In its latest accounts, Typhoo Tea has shared an optimistic outlook for the financial year 2024, citing a significant streamlining of operations in 2023. The directors have expressed their excitement about the future.
The statement from the company reads: “Legacy issues have been largely dealt with and the results of this operational transformation should become evident during this period.”
It continues to outline growth aspirations, noting: “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.”
Additionally, plans include expansion across new sales channels and enhanced operations for better efficiency and profits: “The company will also garner incremental distribution in new channels and improve penetration and operations to achieve higher efficiency and profitability.”
As part of the restructuring process, the workforce reduced from 198 to 116 over the course of the year ending 30 September 2023.
The tea giant came under the ownership of Zetland Capital Partners back in July 2021.