Owner of UK's favourite crisps brand sees monster sales surge

Walkers, the UK's leading crisps brand, has reported a surge in sales of over £60m during its most recent financial year. The Pepsi-owned company, which divides its UK accounts across three entities, has just disclosed its 2023 results, well beyond the 30 September deadline set by Companies House.

Walkers Snack Foods, the manufacturing division, posted a turnover of £359m for 2023, up from £309.7m in the previous 12 months. This increase was attributed to the reimbursement of increased costs associated with manufacturing activities, as reported by City AM.

Pre-tax profit also rose from £28.3m to £31.6m during the same period. Walkers Snacks, the sales and marketing division, reported a turnover of £228.2m for the year, up from £209.8m.

However, its pre-tax profit fell from £90.8m to £56.8m. The division stated that its turnover increased due to higher commission earned "driven by favourable performance on snacks and grains" and higher reimbursement costs compared to 2022.

It added that its pre-tax profit decreased primarily due to a £40m dividend it received in 2022, which was not repeated in 2023. This decline was partially offset by an increase in interest income in 2023 by £10m.

Meanwhile, turnover at Walkers Snacks (Distribution) fell from £146.4m to £141.5m, while it went from making a £6m pre-tax profit to a loss of £1.6m.

The division said its turnover declined "primarily due to [a] decrease in reimbursable costing [in] 2023 compared to 2022 related to warehousing services and distribution.

Walkers was founded in Leicester in 1948 and was sold in 1970 to US-based Standard Brands. Almost 20 years later, the company was snapped up by Pepsico. As well as Walkers, the firm’s brands include Doritos, Frazzles, Monster Munch, Quavers and Wotsits.

In January 2024, City AM reported that a Tax Tribunal had ruled Walkers' Sensations Poppadoms as 'similar to potato crisps', making them ineligible for zero-rated VAT. Walkers Snack Foods challenged an HM Revenue and Customs (HMRC) decision that certain products sold by the company are taxable at the standard rate.

Walkers argued that these products should be zero-rated for VAT purposes as they fall within "item one of group one of part II to schedule eight VAT, being ‘food of a kind used for human consumption’". They maintained that their products do not fall within any of the excepted items in that group, while also arguing for zero-rating under the principle of fiscal neutrality.

However, HMRC contended that the product falls within excepted item 5 of group I, as they are "products [similar to potato crisps, potato sticks, potato puffs] made from the potato, or from potato flour, or from potato starch" and are "packaged for human consumption without further preparation".

Following the recent accounts for Walkers, City AM reported in October that KP Snacks, the maker of popular brands such as Mccoy’s, Hula Hoops and Terrell’s, saw its profits soar to nearly £100m during its latest financial year. The Slough-based company, which also owns brands like KP Nuts, Butterkist, Pom-Bear and Popchips, recorded a pre-tax profit of £93.7m for 2023, a significant increase from the £64.3m it posted in 2022.