Little Moons, a prominent UK manufacturer of mochi dough ice cream, is contemplating the closure of its domestic factory just over a year after its opening announcement.
The London-headquartered company has yet to reach a final decision regarding the future of its Kettering facility in eastern England. However, it has indicated that closure is one of the possibilities being evaluated. Little Moons opened the new 50,000 square foot factory at Cransley Park late last year, highlighting its importance for the company’s growth strategy.
Despite this initial optimism, the company now appears to be reconsidering its strategy. In an official statement, Little Moons remarked, “Little Moons led a robust assessment of its business to ensure operational efficiency that will facilitate a stable and profitable future. This has resulted in proposed structural changes across the whole business: how we go to market, manufacture and support the business. And this does include exploring the viability of shutting down the factory in Kettering and consolidating its operations back into [London facilities] Park Royal and Wembley.”
Unfortunately, these proposals may result in job losses. Employees potentially affected by this proposal have already been informed and are currently engaged in formal consultations prior to any ultimate decision being made. The company underscored its commitment, stating, “We are optimistic about the future growth prospects of Little Moons, and these proposed changes will help us to realize that success.”
At this time, Little Moons has not disclosed the number of employees that may face job loss if the closure proceeds. Reports from local newspapers indicate that the facility is largely staffed by agency workers.
Little Moons claims to be Europe’s leading producer of mochi, which are small balls of gelato ice cream enveloped in rice flour dough. The company distributes its offerings through major supermarket chains in the UK, such as Tesco and Sainsbury’s, and maintains a presence in various European markets.
Last year, Little Moons expressed aspirations to extend its reach into the Asia Pacific region beyond Australia and Singapore, targeting New Zealand and Hong Kong as potential markets.
In March, the company appointed Joanna Allen, a former executive at Graze snacks and Unilever, as the new CEO, succeeding Mike Hedges, who departed earlier that month. Little Moons enjoys backing from L Catterton, a private equity firm that acquired a significant minority stake in the company in 2022.
Recent financial results, filed under V&H Limited with Companies House, reveal a turnover of £64.5 million ($81.4 million today) for the 18 months ending December 30, 2022, an increase from £25.5 million for the previous 12 months. Meanwhile, adjusted EBITDA improved to £8.5 million over the same period, up from £6.9 million. However, the net profit has seen a decline, dropping to £1.5 million from £4.8 million.
Howard Wong, co-founder of Little Moons, mentioned that an 18-month reporting period was essential because the company’s financial year ends in June. He explained, “We realized for an ice-cream company it really doesn’t make sense to have a financial year ending in June because all your activities are in the summer.”
As the food and beverage industry continues to evolve, stakeholders must stay informed about trends impacting the food and drink business and consumer preferences. Little Moons’ adaptability during this challenging period may influence its ability to keep pace with ongoing shifts within the food and drink consumer trends.