Historic British tea company on the brink of administration

Typhoo Tea, one of the UK’s oldest tea companies, is set to appoint administrators following a decline in sales and growing debts.
It has emerged that the loss-making tea company has filed a notice to appoint administrators and is understood to be using the process to attempt a sale of the business. The move puts more than 100 jobs at risks and threatens the future of a brand that has endured for more than a century.
The Bristol-based group had been attempting a turnaround which included an overhaul of its supply chain and staff reductions. However, it suffered a setback last year after a group of trespassers caused significant disruption to its business by breaking into its site in Moreton, Merseyside.
Typhoo was launched in 1903 by a Birmingham grocer, John Summer. The business is controlled by Zetland Capital, a private equity firm, which took a majority shareholding in Typhoo from Apeejay Surrendra Group, one of the largest tea producers in India.
Dave McNulty, the former boss of Burt’s Crisps, was appointed as Typhoo’s new chief executive last month. He replaced Andrew Reardon, who had led the tea company since July 2022.
The notice to appoint administrators “affords the company some breathing space to explore solutions”, McNulty told the BBC.
“This does not mean we are in administration,” McNulty said. He added that it was “an ongoing confidential process”.
Typhoo reported revenues of £25.3 million for the year to September 30, 2023, down from £33.7 million during the same period a year earlier, according to the most recent accounts.
Its pre-tax losses widened to £38 million in the 12-month period from £8.5 million the previous year.
The business also reported exceptional costs of £24.1 million in the 2023 financial year, a large portion of which was due to damage from the site break-in.
Typhoo said that a group of trespassers occupied its site in Moreton for several days in August 2023.
The tea company said the break-in caused “extensive damage” to stock and machinery in the factory and made it “inaccessible”. This caused low tea stock levels and meant that some customer orders “could not be fully fulfilled” shortly after the trespassing incident occurred. The break-in also delayed the sale of the factory in Moreton until June 2024.
General tea paper shortages in the UK last year also hit Typhoo’s stock availability and meant that it was unable to supply all customers with their orders.
The group said that its customer services levels “had improved” since last year’s disruption thanks to improvements in its supply chain.
Typhoo has not been in the black since it reported pre-tax profit of £220,000 for the financial year 2017. Since then, the company has reported combined pre-tax losses of more than £100 million.