Shares in Cranswick PLC (LSE:CWK) fell sharply on Thursday after investors squawked at reports that a number of retailers, including Aldi, Pret a Manger and J Sainsbury PLC (LSE:SBRY) have recalled food-to-go products containing chicken from the meat producer due to concerns about salmonella contamination.
The cooked poultry involved has emerged from Cranswick’s Benson Park facility in Hull, which has now been closed to allow the company to carry out an investigation.
Cranswick said it will outsource cooked poultry production on a short-term basis to its other sites as well as UK competitors in order to reduce business disruption for its customers whilst the Hull site is prepared for reopening.
Meanwhile, the company was said to be been speaking to its customers, testing laboratories and the Foods Standards Agency (FSA) about the present contamination issue.
Analyst Clive Black at broker Shore Capital said that as the company has "well-versed business continuity procedures in play", they "do not anticipate that this Benson Park matter will be a notable financial issue for Cranswick in FY23, as unwelcome as it is".
Cranswick's food-to-go clients, such as Greencore Group PLC (LSE:GNC) or Samworth Bros, are also not expected to suffer, the analyst said. Cranswick is a client of Shore Capital.
"Indeed, in the big scheme of things product recalls are not uncommon across the UK food system as evidenced by the number of FSA notices but Cranswick will now be focused on current investigations."