Falling profits prompt ADAS sell-off
By Robert Harris
ADAS, the consultancy firm, is to sell off its environment and laboratories divisions and restructure its core rural business to tackle falling profitability.
The companys agriculture and research sectors are making losses after six years of “unprecedented and sustained” downward pressure on farming.
The situation has been exacerbated by the foot-and-mouth outbreak, said ADAS chief executive Steve Collier.
“This has impacted on all who operate within the trade, be they individual producers or part of the wider allied supply trade.
“This scenario is requiring everyone to examine very closely all aspects of their business operations and, in this respect, ADAS is no exception.”
At about 54 million, turnover at ADAS has remained relatively static since the company was privatised four years ago.
Although careful cost control has helped, ADAS has not achieved its financial targets over the past couple of years, said Mr Collier.
The profitable environment and laboratory businesses, which employ about 300 people and have a strong non-farming slant, will be sold as soon as possible.
This will “allow them to achieve their full potential” and provide investment in the remaining three divisions – agri-food, professional services and research..
The move will enable ADAS to concentrate on core rural business advising the government, its agencies and all sectors of the food chain, said Mr Collier.
The company intends to develop its strategic consulting and policy advice services and expand investment in new technologies.
Mr Collier said ADAS intended to get involved in the expected post-foot-and-mouth debate about the future of food production and countryside management.
“Undoubtedly a number of livestock producers will take the opportunity that foot-and-mouth presents to leave the industry,” he said.
“Others will be looking at new ways of operating successfully in a changing rural environment. There will also be further consolidation of the supplier base.
“These are significant and challenging times for us but it will very much be business as usual as far as our customers are concerned.”