Though the analysts weren't too pessimistic about the company's long-term prospects.
No surprise was occasioned by the decline in the profits of Barclay Perkins & Co., brewers, published overnight, for the year's dividend of 6 per cent., compared with 8 per cent., previously announced, had prepared shareholders for some decline in earnings. The gross profits for the year ended March 31st last amount to £400,622, in comparison with £431,959 twelve months ago. While the Company has probably continued to experience an increase in turnover, the higher cost of brewing materials have doubtless had some thing to do with the lower profits now returned. This applies especially to the purchase of the new barley crop last year at a very much higher price than in the previous accounting period, the full effects of which would be felt during this year just concluded. Moreover, the undertaking is expending large sums on rebuilding and improving licensed premises, which must have an effect on the cash resources, though at the same time the avoidance of fresh borrowing strengthens the financial structure. After providing for depreciation and other charges including £13,000 for tax and N.D.C., compared with £15,000, it is proposed to pay at this time a final of 4 per cent. on the Ordinary capital, making, as already stated, 6 per cent. for the year, against 8 per cent. The carry-forward is up from £70,525 to £74,580. The Company has an excellent record, and the present decline in profits may be regarded as only temporary."
The Scotsman - Thursday 22 June 1939, page 2.
There was indeed a hike in the price of barley in 1939, as you can see here. But things didn't get any better in later years, as the war caused barley imports to dry up and the price skyrocketed. In 1941, barley was almost six times as expensive as in 1938.
The increase was so great that the government felt compelled to step in and control the price of barley. This intervention stabilised the cost in the latter war years. It must have helped that domestic barley production more than doubled over the course of the war.
|Barley Home Production and imports 1934 - 1945|
|Average Price per Cwt.|
|Year ended 31st Dec.||Acreage||Estimated Produce Cwts.||s.||d.||Imports Cwts.|
|"Brewers' Almanack 1955", page 66.|
On the upside, Barclay Perkins production was on the increase:
|Barclay Perkins output 1936 - 1040|
|Year ending 31st March||malt used Qrs||flaked & maize used Qrs||Sugar used Qrs||hops used cwts||Bulk barrels brewed|
|Brewing notebook A-H held at the London Metropolitan Archives, document number ACC/2305/1/711/1.|
Though the war would seriously disrupt the company's business. Sometimes in a very direct way. For example, when the brew house was hit by bombs.