LONDON - The British food manufacturer at the centre of a health scare caused by food contaminated with a potentially cancer-causing dye said Wednesday it did not expect to lose money over the affair.
"The Sudan 1 issue has been an upheaval for the business in terms of time and effort," Premier Foods chief executive Robert Schofield said as the company unveiled pre-tax profits of 8.7 million pounds (12.7 million euros, 16.6 million dollars) in 2004 compared with a loss of 300,000 pounds a year earlier.
"However, in financial terms, based upon our assessment of claims and our insurance position, we believe the company does not have a material financial exposure," Schofield added.
The food scare came too late to affect the annual results.
Premier Foods has found itself at the centre of a potentially damaging cancer scare after using in its products chilli powder contaminated with Sudan 1 -- an illegal red dye used for colouring non-edible items such as gasoline and shoe polish.
The dye, used in a batch of Worcester sauce flavouring, was consequently used as an ingredient in a wide range of products, resulting in the withdrawal from sale last month of more than 400 foodstuffs.
Premier, maker of British household brands including Branston Pickle, Typhoo Tea and Ambrosia custard, said Wednesday that a number of its customers intended to claim for the costs related to the recall of products.
Customers could claim for alleged damage to their own products, the costs of recalling and destroying recovered products and claims for consequential loss, Premier said.
The firm added it had not been possible to fully quantify potential claims because of the limited number that had been made so far and uncertainty surrounding the situation, which they were monitoring closely.
"We will continue to review the situation on a daily basis and should the situation change materially we will update the markets accordingly," Schofield said.
Britain`s Food Standards Agency announced last Thursday it had launched an unprecedented investigation into a string of companies allegedly involved in a cancer scare.
03/02/2005 14:56 GMT