Typhoo Tea Faces Imminent Administration Amidst Financial Decline

Typhoo Tea, a brand established 120 years ago, is preparing to appoint administrators due to a decline in sales, increasing losses, and growing debts. According to Typhoo’s chief executive, Dave McNulty, who spoke to the BBC, the company has submitted a notice to the court “which affords the company some breathing space to explore solutions.” The firm has been engaged in efforts to improve its financial situation for a considerable period. Nevertheless, the company encountered a setback last year when trespassers caused damage to its former factory located in Moreton, Merseyside. Mr. McNulty stated, “Given the delicate nature of this we are not in a position to comment any further.” He further explained that the “notice of intent” involves the appointment of the accountancy firm EY to manage the procedure. He clarified, “This does not mean we are in administration,” describing it as “an ongoing confidential process.” The company’s most recent financial results, covering the year ending September 2023, show that losses expanded to £38 million from £9.6 million. During the same period, sales decreased from £33.7 million to £25.3 million. Typhoo Tea, headquartered in Bristol, was established in 1903 and is recognized as a prominent tea brand in the UK, alongside competitors such as PG Tips, Tetley’s, and Yorkshire Tea. The private equity firm Zetland Capital holds a majority stake in Typhoo. Previously, the Indian conglomerate Apeejay Surrendra Group controlled the company after acquiring it from Premier Foods in 2005. Apeejay Surrendra divested its shareholding to Zetland in 2021. The financial results additionally disclosed £24.1 million in “exceptional costs,” a portion of which is attributed to the break-in at the Moreton plant, which ceased operations last year. Typhoo reported: “During August 2023, a group of organised trespassers broke into the Moreton site and occupied it for several days.” The company further stated that the trespassers inflicted “extensive damage” and rendered the site “inaccessible.” This incident resulted in a significant quantity of tea becoming unusable, preventing the company from fulfilling certain customer orders. The prospect of administration emerges only two months after the company relaunched its brand with “Fear Free Tea,” a campaign designed to draw attention to violence and abuse within the tea supply chain. Typhoo stated that it does not guarantee its own product is “fear free” but rather “invites the tea industry to question and assess whether their teas are free of sexual violence.” A 2023 BBC Panorama documentary titled “Sex for Work: The True Cost of our Tea” revealed that three out of four women interviewed on tea plantations had experienced sexual abuse. Copyright 2024 BBC. All rights reserved. The BBC bears no responsibility for the content found on external websites. Information regarding our policy on external linking is available.