Carr’s Group has faced “enormous challenges as a result of the flooding”, the company’s first-quarter trading update has confirmed. 

Severe flooding in Cumbria has affected one of the food and farming conglomerate’s major customers, believed to be Carlisle-based United Biscuits (UB), which was flooded by over a metre of water in the wake of Storm Desmond. The factory in Church Street, Caldewgate produces a range of McVitie’s biscuits and employs 600 people.

The amount of flour the customer in question requires from Carr’s has been directly affected, but as the milling group hasinsurance in place, no notable financial impact is anticipated.

Chief executive Tim Davies said: “Despite the direct impact of the floods… the speed of our recovery owes much to the resilience and tenacity of our employees.”

High hopes for a bright future

The group’s financial position remains strong – net debt as at 28 November 2015 was £31.9m, compared to £30.4m as at 29 November 2014 and £24.4m as at 28 August 2015. The group continues to trade in line with the board’s expectations for the year.

However it added that shopping habits have also had a significant effect, and the retailers’ response has led to margin pressure in the supply chain, putting further pressure on the business.