'Protocol is working for us' as Norbrook posts improved sales and profits
THE boss of Newry veterinary pharma firm Norbrook has expressed concern at “the rumblings around the triggering of Article 16”, which he claimed “has the potential to lead to a period of uncertainty”.
And he admitted that the Protocol has so far been “very effective” for the company, which bills itself as the largest privately-owned pharmaceutical company in the world.
Liam Nagle, chairman and chief executive at Norbrook, was speaking as the company posted a “significantly improved” financial performance in the year to July 30.
Revenue rose by 9 per cent to £231 million while operating profits showed a six-fold increase from £4.4m last year to £28.4m, which he said it was another staging post for Norbrook to get back to where the business needs to be.
“We're not quite there yet, but we're on the right path,” he told the Irish News.
Norbrook, established in 1969 by the late Lord Ballyedmond (Edward Haughey), has had a torrid few years, first hit by a global recall of its veterinary injectable drug products in 2019 which wiped millions of pounds off its bottom line.
Then in the early stages of Covid last year, it was forced to reduce its manufacturing capacity amid a staff absenteeism rate of 25 per cent.
“Having returned to normalised levels of supply, we drove to regain lost market share, working with our customers, with whom we have strong long term close relationships,” Mr Nagle said.
But he cautioned: “Having spend four years preparing for Brexit, we're finding the Protocol is pretty effective for us. We had some minor issues at the start, but otherwise there's been no negative impact on our business.
“Indeed we see the Protocol providing a good structure in being able to participate in both the UK market and in the EU. So we've quite positive.
“But we're concerned at some of the rumblings around the potential triggering of Article 16.
“Our European customers in particular are worried about continuity of supply, and if it happened, it would clearly give us a problem in the short term in terms of accessing our European customer base.”
A continuous programme of significant capital investment has provided a platform for strong growth in a buoyant veterinary pharmaceutical market, where Norbrook's ongoing investment in research and development has seen it launch a number of new products, particularly for the US market.
The company has continued to invest in the future of the business, with capital investment of £12m in 2021, bringing the total invested in the last six years to £75 million.
Norbook plans to spend another £20 million in capital investment next year in its manufacturing facilities, building a new micro-lab, installing sprinkler systems and also in further upgrading its IT.
Mr Nagle also revealed that the company, which has more than 1,600 staff at its Newry operation, is currently “people resource-constrained”.
He said: “We've around 200 open positions available now, including production operatives, quality control QC analysts and management positions, but are finding it desperately hard to get access to the people we need to drive the business forward.”
The difficult operational conditions which Norbrook endured at the start of the pandemic have been largely overcome, he said.
“We're doing more than 400 antigen tests a week and have six nurses on site across the business, have our own PCR capability which allows us to do 20 test a day and have spent £3m on Covid-related safety processes, so we've really demonstrated to employees that we're totally focused on their safety,” he said.